Prepayment Effects On Rates One of the things that impacts the value of servicing is the length of time that the company servicing the loan (i.e., collecting the payments) expects to have the loan on their books. No one wants to pay a 2 or 3 point premium for a loan that they service for
March 2009
The US Producer Price Index, which measures inflation at the business and manufacturing levels of the economy, was +0.1% in February and -1.3% year-over-year through February. Excluding volatile oil and food costs from the readings, “Core” PPI for February was +0.2% and +4.0% YOY through February. Here’s a link to the December PPI which includes
Where Should 30yr Rates Be? In a “perfect world”, where should 30-yr mortgage rates be? Traditionally, and of course tradition has little to do with the current credit markets, 30-yr fixed mortgage rates are about 1.50% above the 10-yr yield. (Traditionally, servicing companies assumed that they would have the mortgage on their books for 10
We are in week 11 of the Fed’s mortgage bond buying program, a topic we discuss weekly on Friday’s when the Fed’s mortgage bond buying is reported for the given week. The purpose of this program is to buy mortgage bonds which drives bond prices up and yields—or rates—down. The original commitment announced November 24,
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NYU economics professor and head of RGE Monitor Nouriel Roubini said today the latest stock rally will be short lived for many reasons and that banks like Citi, BofA and JP Morgan Chase saying they’re profitable is not exactly true—because the fine print is that they are profitable “before provisions for writedowns.” Below is the
The economy is not good. I’ll tell you how bad the economy is. I was in Beverly Hills yesterday, and I saw a guy driving an American car! All CA Lenders Must Have License # On Card If you’re located in California, be prepared to order new business cards for everyone. Starting on July 1st
According to an AP report, former vice president Dick Cheney told CNN that the Bush administration can’t be blamed for the current economic woes: Don’t blame the Bush administration for all the country’s economic problems. That’s the message from former Vice President Dick Cheney. President Barack Obama constantly talks about the enormous economic troubles that
China said today asked that “the US maintain its good credit, to honor its promises and to guarantee the safety of China’s assets.” This came after they expressed concern that the new administration is too aggressive about spending which may lead to inflation, which would erode the value of China’s US bond holdings. They’re now
This week was the tenth week of a mortgage bond purchase program by the Federal Reserve—here’s week 9. Beginning on March 5 and ending on March 11, the Fed bought $27.1b of mortgage bonds—below is a table breaking down the amounts for each coupon and maturity across the three agencies that issue mortgages: Fannie Mae,
The other day my 14-yr old daughter told me that she had decided to become a vegetarian. I told her, “Well, that’s too bad. I guess that you’ll miss eating Animal Crackers in your lunch.” She is still puzzling over that one. If you don’t know what color to paint that last bathroom in your
Retail sales for February were down -0.1% which beat expectations of -0.5%, and there was also a January revision to +1.8% from previously reported 1%. Economic stabilization? Some don’t think so since this is a particularly volatile and seasonal report. January’s revisions are most likely from gift certificate spending left over from holidays.
TALF Q&A Here’s everything that you wanted to know about TALF but was afraid to ask. Stimulus By State And here’s everything you wanted to know about how the stimulus activity impacts your state. Countrywide (“Countryfine”) On the Simpson’s Warehouse Lending Getting Smaller Banks in the warehouse lending business are making difficult decisions with regard
My son asked me the other day, “If you try to fail, and succeed, which one have you done?” FHA Loan Limit Increases for 2009 CitiMortgage joined other lenders in publishing their FHA loan limit increases, which are effective for 2009. “For FHA Loans that are credit approved pursuant to the American Recovery and Reinvestment
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