investors Archives - MBSQuoteline

BlogTalkRadio Podcast – June 14, 2010

JoeFarr 2017-12-20T17:34:16+00:00 June 17th, 2010|Categories: BlogTalkRadio Podcasts|Tags: BlogTalkRadio, David Lykken, DJIA, Dow Jones, Fed, Federal Open Market Committee, Federal Reserve, global stock markets, inflation, investment risk, investors, Joe Farr, Lykken-on-Lending, MBS Prices, MBSQuoteline, mortgage backed securities, mortgage backed securities prices, mortgage prices, mortgage rates, stock market volatility|

This week on BlogTalkRadio/Lykken-on-Lending: What drives mortgage rates? Inflation and uncertainty. Inflation is not present right now and according to the majority of the Federal Open Market Committee members it is not expected to be much of a concern for the near future. Uncertainty, though, is alive and well. Continuation of the recent economic improvement in the US is considered anything but certain. Global economic growth has been a question mark. The ability of several European nations to satisfy their debt obligations is uncertain. This uncertainty has resulted in tremendous volatility in the stock market, which has caused tremendous volatility in mortgage-backed securities prices. Daily, global headlines suggest to investors its time to shift assets to more or less risky investments. That is what happened last week. After reaching the highest level of the year, mortgage-backed security prices were beat down on Thursday based on headlines from Australia, China, and Europe, all which suggested improving economic conditions. Investors sold low risk bonds and bought higher risk stocks. The Dow gained 270 points. MBS prices lost 25/32nds. This pattern has been in place now since April when the European debt crisis raised its ugly head. Look for volatility in mortgage-backed security [...]

In The News: “Skin in the Game” – Risk Retention Amendment to Senate Bill 3217

JoeFarr 2017-12-20T17:34:18+00:00 May 21st, 2010|Categories: In The News|Tags: Fannie Mae, FHA, financial reform bill, FNMA, Freddie Mac, interest rates, investors, Joe Farr, jumbo loans, loan originators, LTVs, MBSQuoteline, mortgage industry, mortgage market, mortgage originators, mortgage prices, mortgage rates, new mortgage loan programs, pick-a-pay loans, Qualifying Mortgage Loans, Restoring American Financial Stability Act of 2010, risk retention, risk retention amendment, Senate bill S3217, U.S. House of Representatives, U.S. Senate, VA loans|

Senate Bill 3217 Restoring American Financial Stability is working its way through the Senate and is expected to be passed in the coming weeks. Certain provisions of this bill will have a significant impact on the mortgage industry. As you may recall, the Senate Bill 3217, as originally proposed, included a provision which would have required 5% of the risk on all loans originated be retained by the originator upon sale to investors. The provision was not clear as to which entity or entities in the origination chain would be required to retain the risk. It was not clear whether the risk that was to be retained would be an ownership interest in the loan or reserves supported by cash. It was also not clear how long the originator would have been required to retain the risk. The original provisions would have been devastating to the mortgage industry. The 5% risk retention would have forced many mortgage originators from the business and would have driven mortgage rates much higher. After significant industry efforts, this provision was amended last week. The amendment, as passed by the Senate, does very little to answer these questions, but what it does do is exempt [...]

BlogTalkRadio Podcast – May 17, 2010

JoeFarr 2017-12-20T17:34:18+00:00 May 20th, 2010|Categories: BlogTalkRadio Podcasts|Tags: BlogTalkRadio, Community Mortgage Banking Project, David Lykken, financial reform bill, Glen Corso, investors, Joe Farr, loan officer compensation, loan officer compensation amendment, loan originators, Lykken-on-Lending, MBSQuoteline, mortgage backed securities, mortgage banking industry, mortgage industry, mortgage loans, mortgage market, mortgage originators, mortgage prices, podcast, Qualified Mortgage Loans, Restoring American Financial Stability Act of 2010, risk retention, risk retention amendment, risk retention requirement, secondary market, Senate bill S3217, yield spread premium|

Senate Bill 3217 Restoring American Financial Stability was the focus of discussion on the show Monday, particularly two recently passed amendments which are of great interest to the mortgage banking industry. The amendments deal with risk retention and loan officer compensation. One is good for the industry and the other is not. Glen Corso, Executive Director of The Community Mortgage Banking Project, joined the show to bring a first hand understanding of the amendments and their status. The amendment that is good for the mortgage industry deals with the risk retention provisions of the original bill. The original bill would have required mortgage originators to retain “skin in the game. It would have required originators to retain 5% of the risk on all the loans they originated and sold to investors. The amendment exempts from the 5% risk retention requirement certain mortgage loans which meet the definition of Qualified Mortgage Loans. Since 90% or more of today’s loans will meet the definition of Qualified Mortgage Loan, the amendment significantly reduces the number of loans on which originators will be required to retain risk. The amendment that is not good for the mortgage industry restricts how loan originators are to be [...]

In The News: Why Greece Matters for the US Mortgage Industry

DanAlpert 2018-01-02T18:40:44+00:00 May 13th, 2010|Categories: In The News|Tags: economy, EU, Euro, Europe, European Union, global stock markets, Greece, Greek government, IMF, international lending, International Monetary Fund, investments, investors, MBS, mortgage backed securities, mortgage industry, mortgage market, mortgage prices, mortgage rates, US exports, US Mortgage Markets, US Treasuries|

The economic troubles of Greece have been in the news frequently in recent weeks. Its ability to recover from significant budget deficits and to pay its debts has been questioned and the government debt of Greece has been downgraded. The economy of Greece is tiny, however. The problem is that investors are concerned that other smaller European countries will reveal similar problems. Financial institutions and other private investors have become very reluctant to buy the government debt of these countries, requiring very high yields to do so. The fear is that as the problem grows, banks will become increasingly selective about lending worldwide, as they did during the subprime mortgage crisis. The clear solution is for the Greek government to cut spending, but this takes time and is politically unpopular to accomplish, while the reduced access to credit markets has already taken place. Last week, the European Union (EU) and the International Monetary Fund (IMF) agreed on a $146 billion economic aid package for Greece to allow enough time for the country to stabilize. Still, Greek workers responded to proposed austerity measures with strikes and protests. Financial markets in Europe continued to fall as investors were skeptical that the bailout [...]

BlogTalkRadio Podcast – Mar 29, 2010

JoeFarr 2017-12-20T17:34:19+00:00 April 22nd, 2010|Categories: BlogTalkRadio Podcasts|Tags: BlogTalkRadio, David Lykken, Delmar DataTrac, Durable Orders, Health Care, Health Care Reform Bill, HMDA, inflation, interest rates, investors, Joe Farr, loan originators, Lykken-on-Lending, market, MBS, MBS market, MBSQuoteline, mortgage backed securities, mortgage market, mortgage prices, podcast, Restoring American Financial Stability Act of 2010, Rob Katz, secondary market, Treasury, Treasury Auction, unemployment|

MBS prices were volatile last week and fell about half a point during the week. Most of the push for MBS prices lower came from weak Treasury auctions. On Wednesday the 5 Yr Treasury Note received lower than usual demand, especially from foreign investors, and the yield required from the bidders was higher than the previous trading range. The weakness in the Treasury auction spilled over to the MBS market. The economic data released during the week was mixed with Durable Orders better than expected and the housing data was a little weaker than expected. All of the focus in Congress now that Health Care has passed seems to be with the Restoring American Financial Stability Act of 2010. This proposed law will have sweeping changes for the mortgage industry, if passed. It includes the creation of a new regulator for consumer protection, retention of 5% of the risk on loans originated and then sold, and increased HMDA reporting requirements, among other things. This 1300 page bill seems to be on a fast track. Discussion continued on the risks and benefits of converting a mortgage company’s operations from a best efforts delivery of loans originated to a mandatory delivery. The [...]