Good morning and happy Monday! We start getting back into scheduled housing news releases tomorrow. For today, let’s start with forbearances. More than 200,000 homeowners have exited forbearance programs in the past two weeks, taking the total to under 2% of total homeowners for the first time since early in the pandemic. In other news, post-moratorium foreclosure activity increased 5% during October compared with September. This equates to an increase of 20,587 subject to a default notice, scheduled auction, or bank repossession.

Lastly, from the Wall St. Journal, homebuyers aren’t rate shopping now as they did in higher rate timeframes of the past. The primary reason seems to be with rates as low as they are. Buyers already feel they’re getting a good deal and are just not making an effort. A slight difference in rates over 30yrs can make a huge difference in total dollars expended.

Bonds today are selling off, with 10yr T-Notes -12/32 to yield 1.60%. In MBS 30yr FNMA 2.50% are -2/32 to $102-09, which is a 1.97% yield and +72 to the 5yr treasury curve. That’s all for us today. Have a great day, and call or email if you have an MBS or loan inquiry.

Cherry Picks

ARMS / FLOATERS

Cost
Average Life
Yield
Speed
Spread
Coupon
MTR
Loans
Caps
Floor
1 Yr. Libor
WAM
Factor
$103-18+
3.4 yr
1.51%
15% CPB
+45/z curve
2.686%
64
43
Periodic 5/2/5, Lifetime 7.687%
1.619%
+1.619%
340
.5349
$1.98mm+ Fannie Mae 7/1 ARM 2.686%, #841231, 4/50 stated final

10 Year Fixed

Cost
Average Life
Yield
Speed
Spread
Coupon
# Loans
Origination
Type
WAM
Factor
$103-14
3.2 yr
.87%
346 PSA
+15/I curve
2.00%
1,304
2020
Fannie Major
1133
.9665
$3mm+ Fannie Mae 10yr am 2.00%, #MA4425, 9/31 stated final

15 Year Fixed

Cost
Average Life
Yield
Speed
Spread
Coupon
# Loans
Origination
Type
WAM
Factor
$103-06
4.9 yr
1.29%
234 PSA
+24/I curve
2.00%
1,179
2021
Fannie Major
177
1.0000
$8mm Fannie Mae Dwarf 2.00%, #MA4497, 11/36 stated final

20 Year Fixed

Cost
Average Life
Yield
Speed
Spread
Coupon
# Loans
Origination
Type
WAM
Factor
$102-20
5.5 yr
1.47%
241 PSA
+34/I curve
2.00%
9,078
2021
Fannie Major
238
.9972
$7mm+ Fannie Mae 20yr am 2.00%, #MA4474, 11/41 stated final

30 Year Fixed

Cost
Average Life
Yield
Speed
Spread
Coupon
# Loans
Origination
Type
WAM
Factor
$103-18
5.7 yr
1.80%
277 PSA
+64/I curve
2.50%
34,524
2021
Fannie Major
356
.9888
$10mm Fannie Mae 30 yr am 2.50%, #MA4438, 10/51 stated final

Agency CMBS

Cost
Average Life
Yield
Speed
Coupon
Call Protection
Tier
GEO
DSCR
LTV
OCC
Interest Only Until
Factor
$101-12
11.5 yr
1.80% + 25/swaps
0% CPY
1.91%
136mo Yield Maintenance
2
NH
--
79.4%
95%
70 Months
1.0000
$11.0mm+ FNMA 12/11.5 DUS #BS3024, 1.91% coupon, 9/2033 stated final

Agency CMO – 3 Year

Cost
Average Life
Yield
Speed
Spread
Collateral
Coupon
Band
Avg Life w/ rates +300
Factor
$103-14
3.5 yr
1.43%
387 PSA
+65/I curve
New Fannie 30yr 3.50%
2.50%
Busted PAC
8.4 yr
.5156
$5mm Freddie Mac "Busted PAC" 2.50%, FHR 4926 BL, 10/49 stated final

Agency CMO – 5 Year

Cost
Average Life
Yield
Speed
Spread
Collateral
Coupon
Band
Avg Life w/ rates +300
Interest Only until
Factor
$10612
6.1 yr
1.85%
483 PSA
+65/I curve
New FNMA 30yr Jumbo 3.00%
3.00%
No Band
18.4 yr
4/25
1.0000
$6.6mm+ Fannie Mae "AD Busted PAC" 3.00%, #FNR 20-11 JW, 3/50 stated final

Agency CMO – Long End

Cost
Average Life
Yield
Speed
Spread
Collateral
Coupon
Band
Avg Life w/ rates +300
Interest Only until
Factor
$96-03
18.1 yr
2.27%
179 PSA
+45/I curve
New 30yr Jumbo 2.00%
2.00%
131-266 PAC
19.3 yr
5/36
1.0000
$4.7mm Freddie Mac "AD PAC" 2.00%, #FHR 5055 PL, 12/50 stated final

Jim Tait is a registered representative with and offers securities through Hanover Securities, Inc. (Hanover), Member FINRA & SIPC. Although this information has been obtained from sources we believe reliable, we do not guarantee its accuracy, and it may be incomplete or condensed. This is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Securities that may be shown are subject to availability and changes in price. Past performance is not indicative of future results. Changes in any assumptions may have a material effect on projected results.

 This information from Hanover Securities is for your private use and does not constitute an offer or solicitation with respect to the sale of any security. This information was obtained from sources we believe to be reliable but we do not represent that it is accurate or complete, and it should not be relied on as such. Certain transactions may give rise to substantial risk and are not suitable for all investors. This information was based on current market indicators which may vary over time. We may from time to time buy or sell, or have long or short positions in securities identical or related to those identified herein. 

Although this information has been obtained from sources we believe reliable, we do not guarantee its accuracy, and it may be incomplete or condensed. This is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Loans and/or Securities which may be shown are subject to availability and changes in price. Past performance is not indicative of future results. Changes in any assumptions may have a material effect on projected results. This information from Banes Capital Group (BCG) and/or Hanover Securities is for your private use, and was obtained from sources we believe to be reliable. However, we do not represent that this information is accurate or complete, and it should not be relied on as such. This information is for institutional investors only, and as such certain transactions may give rise to substantial risk and are not suitable for all investors. This information was based on current market indicators which may vary over time. We may from time to time buy or sell, or have long or short positions in loans or securities identical or related to those identified herein. 

The pricing of loans or any Level II or III asset is inherently an exercise in quantifying uncertain variables. As such, great care should be taken when pricing loans for reporting purposes. The information included herein should never be taken as the sole method, or even a method to be relied on, for the pricing of loans or other Level II or III assets as this is for informational purposes only.