This is one of those reprice alerts that will only apply to a very small sub-set of lenders who are characteristically the first to reprice for the worse on moves lower in MBS Prices. Even then, current price levels are just barely on the edge of risky territory for such lenders (MBS down 3 ticks on the day at 103-12).
The culprit looks to be the 3pm Treasury close. A low volume and somewhat illiquid environment have exacerbated the negativity to a small extent and 10yr yields are testing their AM highs just over 2%. If they bounce in the after hours trade (3pm-5pm), MBS may well go no lower, and reprices would be increasingly unlikely.
Bottom line, watch the 103-13 level in Fannie 3.5’s. We’d guess that any of the “early crowd” that might reprice would do it between there and 103-10, with more lenders getting involved under 103-10. Not a panic situation at all… Just a heads up that you might see one or two.