CS: Latest 30-Year Agency Prepay Speeds Rise 3%


Agency prepayment speeds came in line with expectations in the 30-year sector, where they were up 3% from the previous month, according to Credit Suisse’s fixed income research report Wednesday.

The report also indicated some relatively lower 15-year coupons, particularly 2010 vintage 3.5s and 2011 vintage 4s, slowed more than expected.

“We think this is probably a timing issue where the slowdown in the lowest coupons reflects relatively flat 15-year mortgage rates in the past month or two,” said Mahesh Swaminathan, managing director, residential mortgage-backed securities research, at Credit Suisse. “As a result these low coupon borrowers most likely got processed more quickly through the pipeline.”

Earlier data showed the lower coupons in the 15-year sector “had a big spike when rates first rallied in the month of September” and relatively higher coupons in the 15-year sector increased slightly in the latest month’s data, in contrast to the slowing in the lower coupons. This suggests, “Lenders tend to get the borrowers whose incentives are most marginal through the pipeline first,” he said in an interview with this publication.

Daily Briefing | Wednesday, December 7, 2011

  • Industry Wary of G-Fee Hike to Fund Payroll Tax Relief

    The mortgage industry is having growing concerns about a payroll tax relief measure that would raise GSE guarantee fees by 12.5 basis points, using the additional revenues to pay for other government programs.

  • HARP Refis on the Rise in 3Q

    Servicers refinanced more than 85,000 high LTV loans under the Home Affordable Refinancing Program in the third quarter, up nearly 11% from the prior period, according to new figures compiled by the Federal Housing Finance Agency.

  • Purchase, Refi Apps Spike

    Application volume increased by 12.8% on a seasonally adjusted basis for the week ended Dec. 2, as rates fell to their lowest levels in two months.

  • Thrifts See Originations Rise, But Market Share Paltry

    Federally chartered thrifts originated $25.9 billion of single-family loans during the third quarter, up nearly 9% from 2Q, according to figures compiled by the Office of the Comptroller of the Currency.

  • Citigroup to Cut 4,500 Full-Timers, But No Details Provided

    Citigroup Inc. has started job cuts this quarter that will affect nearly 4,500 people, chief executive Vikram Pandit said on Tuesday.

  • GAO: REO Poses Huge Strain on Banks, Local Governments

    According to a Government Accountability Office report, while banks “are not properly maintaining” the growing number of vacant and foreclosed properties nationwide, resources required to demolish the large number of long-term vacant properties have exceeded local budgets.

  • Investors Account for 40% of REO Deals

    Remember when “investor” was a four-letter word? Not anymore. Now, investors are all but saving the housing market.

  • Florida Realtors See Mini-Recovery

    Even though foreclosures and distressed properties will remain a significant part of the home sales market in Florida next year, plus the macro economic headwinds, economists cited by the state’s Realtors said the market is in “a mini-recovery.”

  • Executive Team for Stewart Information Services

    Matt Morris, who was recently appointed as chief executive of Stewart Information Services Corp., Houston, has created an executive team at the company.

  • Nevada, California AG’s Form Mortgage Fraud Investigation Alliance

    The Attorneys General of California and Nevada are combining their investigative forces to combat misconduct and fraud within the mortgage industry against state homeowners.

  • Connecticut Mortgage Firm Gets Another License Approval

    Total Mortgage Services, Milford, Conn., said it has received regulatory approvals to fund residential loans in West Virginia.

  • CFPB Battle Looms Over Dodd-Frank Hearing

    Although a Senate Banking Committee hearing on Tuesday featured testimony from top officials at six different financial regulators, it was an agency not in the room that drew the most attention.

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