Mortgage and Finance

Mortgage News Daily

Posted To: MBS Commentary

It's that time again. Or, at least it will be next Friday. After 2 months in a row of painful NFP reactions in bond markets, the big jobs report is back again. The Fed has probably done some work toward decoupling rate-hike expectations from payrolls, but even before that, the previous reactions still bigger than they should have been according to previous Fed rhetoric. Getting back to today's events, we only really had GDP and Yellen's afternoon comments. Yellen expressed concern about wages and inflation, but only if they weaken from current levels. If they don't, she stuck to the same recent script, saying the Fed doesn't need to see these metrics improve in order to hike rates. With next week's NFP in mind, Yellen also mentioned there is still "some way to go"...(read more)

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3/27/2015 2:55:31 PM

Posted To: Mortgage Rate Watch

Mortgage rates had one of their least exciting days of the week today, moving just modestly lower from yesterday's latest levels. The trading range in underlying markets was exceptionally narrow, especially when compared to the week's previous activity. The final revision of 2014's 4th quarter GDP was released this morning, but it was close to forecasts and didn't produce much of a reaction. Fed Chair Yellen spoke in the afternoon, saying that a rate hike would indeed likely be warranted in 2015. By now, this is old news for financial markets. Few, if any, eyelashes were batted. 3.75% remains the most prevalently-quoted conventional 30yr fixed rate for top tier scenarios. For the lenders that moved up to 3.875% yesterday, today's modest gains didn't bring them any lower. The only improvements...(read more)

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3/27/2015 2:21:00 PM

Posted To: MND NewsWire

The old maxim that a household rents only until it can afford to buy a home is apparently being stood on its head in a lot of housing markets. A study published on Friday by Zillow says that "rental affordability is as bad as it's ever been." Nationally, in fact, they found it is consuming nearly twice as much of a family's monthly income as would homeownership and in many markets that ratio is even higher. In the fourth quarter of 2014 Zillow found that, in the U.S. as a whole, households are spending 30.1 percent of their income for a rental while, with a Zillow Home Value Index (ZHVI) of $178,700 and historically low interest rates they would spend 15.3 percent on an owned home. According to Zillow's February Real Estate Market Reports, the ZHVI above reflects a 4.9 percent year-over-year...(read more)

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3/27/2015 12:48:59 PM

Posted To: MBS Commentary

With the exception of only a few trades during a few minutes, Fannie 3.0 MBS prices have remained in a range of 101-28 to 101-29 this morning. That's super narrow! It's already resulting in a few "stability reprices" as lenders are refreshed by the break from the normal volatility. 10yr yields are about 3.5bps lower, and making slightly better directional gains than MBS. GDP data came and went this morning without much fanfare. This was one of the fairest expectations this morning. In addition to the fact that markets have moved on to thinking about Q1 GDP for 2015 (today's was Q4 2014), markets simply haven't been very interested in economic data this week--not bond markets anyway. Even then, the result was 2.2 vs a 2.4 forecast--close enough to be considered "in...(read more)

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3/27/2015 11:05:09 AM

Posted To: Pipeline Press

I love it when I receive an e-mail warning me, "You've had unusual and suspicious activity on your American Express Card." I don't have an American Express Card. Think your IT's security is up to speed? Think again - this e-mail got through, didn't it? Seriously, thanks to Len Tichy who sent along this recent analysis of the current state of IT security issues . "Big money goes around the world, Big money underground. Big money got a mighty voice, Big money make no sound. Big money pull a million strings, Big money hold the prize. Big money weave a mighty web, Big money draw the flies." So strummed Rock & Roll Hall of Fame band Rush. FDIC-insured institutions earned $36.9 billion in the fourth quarter of 2014, down $2.9 billion from a year earlier. The drop in earnings is due to a $4.4...(read more)

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3/27/2015 8:35:50 AM

Posted To: MBS Commentary

There's been a lot of talk about GDP recently, but it's important to keep in mind that most of it has to do revised GDP estimates for the first quarter of 2015 due to some recently weak economic data. The thing being reported today is the final revision of 2014's 4th quarter GDP, which is expected to come in at 2.4%, an upward revision from the previous reading of 2.2% With all the focus on seemingly already shifted to Q1 2015, will today's data matter? That's a good question, and there are a few ways to answer it. For starters, I don't think it MUST matter in the same way NFP always moves markets in the morning. That said, a big surprise in either direction on GDP can certainly have an effect. More importantly, we should ask if bond markets are even interested in any economic data this week...(read more)

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3/27/2015 5:34:00 AM

Posted To: MBS Commentary

Ever since bond markets failed to respond positively to yesterday morning's exceptionally weak Durable Goods report, things have been almost exclusively negative . That anomaly provided a clue that has since been convincingly confirmed: it's not about the data or headlines over the past two days. Once the rally reached levels coinciding with 10yr yields dipping into the mid 1.8's, buyers simply stopped buying. Given the current, ongoing level of illiquidity in bond markets, it doesn't take much to get snowballs rolling after a strong move in one direction. With rates improving almost exclusively for more than 2 weeks, we were arguably in the midst of a strong move through Tuesday. Once the selling takes hold in that scenario, it becomes its own reason for more selling. At this...(read more)

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3/26/2015 2:51:38 PM

Posted To: Mortgage Rate Watch

Mortgage rates rose rapidly today, almost completely erasing the improvement following last week's Fed Announcement. This is especially ironic considering most major media outlets are running Freddie Mac's weekly mortgage rate survey headline. Because that survey receives most of its responses on Monday and Tuesday, it fully benefited from the stronger levels earlier in the week after having totally missed out on last Wednesday and Thursday's big move lower. As such, the headlines suggest that rates are significantly lower this week. That was certainly true on Tuesday afternoon, but rates have risen roughly an eighth of a point since then. That's a big move considering we've gone entire months without moving more than an eighth. Specifically, what had been 3.625 to 3.75% is now 3.75 to 3.875...(read more)

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3/26/2015 1:51:00 PM

Posted To: MND NewsWire

In the past five years there has been a monumental shift in mortgage loan servicing. Bank servicing subsidiaries, which once dominated in the market, no longer even constitute a majority of companies servicing Ginnie Mae mortgage loans. In an article in the CoreLogic Insights blog Faith Schwartz CoreLogic's senior vice president of Government Solutions, takes a look at how and why depository institutions have been releasing their servicing rights and what the implications may be for investors and consumers. Schwartz says that seven years after the collapse of the housing market and after many many changes to regulations affecting mortgage originations, the face of those originations have changed and this is also having an effect on loan servicing. This trend of transferring servicing from banks...(read more)

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3/26/2015 10:28:29 AM

Posted To: MND NewsWire

While a study released on Thursday by RealtyTrac shows a huge discrepancy between the growth in home prices and increasing wages, it appears that housing in most of the country remains affordable. The California company looked at wage growth and home price appreciation over recent two year periods and found that the former is far from keeping up with the latter. In its analysis RealtyTrac used data on median home prices taken from deeds registered in 184 metropolitan statistical areas in the two years that ended in December 2014 and Bureau of Labor Statistics wage data from the second quarter of 2012, when home prices hit bottom and began to recover, and the second quarter of 2014. It adopted the six month time lag between the beginning of the two two-year time periods based on the hypothesis...(read more)

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3/26/2015 10:13:01 AM

Reuters Business News

Reuters: Business News

CHICAGO (Reuters) - Best Buy Co Inc plans to close some stores and consolidate its operations in Canada, the U.S. electronics retailer's second-largest market, in a move that will hurt earnings this year, the company said on Saturday.

3/28/2015 12:07:15 PM

BOAO, China (Reuters) - Chinese President Xi Jinping said on Saturday that the country should not focus on its economic growth rate only, reiterating China's push for a more sustainable, higher-quality expansion.

3/27/2015 9:35:32 PM

PERTH (Reuters) - U.S. energy giant Chevron sold its entire stake in refiner Caltex Australia Ltd for A$4.7 billion ($3.7 billion) in Asia’s biggest block deal this year, as falling oil prices and high costs hurt margins.

3/27/2015 8:58:54 PM

NEW YORK (Reuters) - Wall Street investors may find little reason to make big moves next week as they await monthly U.S. jobs data and any news that could change expectations for the first interest rate hike in almost a decade.

3/27/2015 7:04:57 PM

NEW YORK (Reuters) - U.S. stocks rose modestly on Friday after late news of merger talks in the semiconductor space boosted the technology sector and helped major indexes snap a four-day losing streak.

3/27/2015 5:37:34 PM

SAO PAULO (Reuters) - Brazilian police on Friday arrested the CEO of Grupo Galvão, the latest executive seized in a corruption probe focused on state-run oil firm Petroleo Brasileiro SA.

3/27/2015 5:13:17 PM

(Reuters) - Intel Corp is in talks to buy fellow chipmaker Altera Corp in a deal likely to top $10 billion, according to a source familiar with the matter, making it Intel's biggest purchase ever and the latest merger in the quickly consolidating semiconductor sector.

3/27/2015 4:55:45 PM

SAN FRANCISCO (Reuters) - Yahoo Inc and Microsoft Corp agreed to extend by 30 days the deadline to re-negotiate a ten year search deal, as the two Internet companies attempt to revamp a thorny partnership crafted by former chief executives.

3/27/2015 4:38:50 PM

SAN FRANCISCO/WASHINGTON (Reuters) - Federal Reserve Chair Janet Yellen signaled that the U.S. central bank will likely start raising borrowing costs later this year, even before inflation and wages have returned to health, but emphasized the return to normal interest rates will be gradual.

3/27/2015 4:03:26 PM

WASHINGTON (Reuters) - U.S. economic growth cooled in the fourth quarter as previously reported and after-tax corporate profits took a hit from a strong dollar, which could undermine future business spending.

3/27/2015 2:51:43 PM
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