FRM Update

April 17, 2017

Fixed Rate Mortgage Market Update


For Monday through Wednesday, trading activity improved across the MBS and CMO sectors last week, fading Thursday with the early close and Friday holiday. Prices moved sharply higher with the overall bond market rally. Yield spreads in 15yr and 30yr fixed MBS widened 1 to 3bps to both Treasuries and swaps last week. 30yr mortgage rates fell another 2bps last week and have declined 24bps YTD and are currently at their lowest levels of 2017. Mortgage applications reversed the recent trend and rose for the first time in almost a month, increasing 1.5% from higher purchase application activity. April MBS prepayment speeds are expected to slow down due to reduction in day count, which should more than offset the seasonal increase in home sales.




CMO activity seemed to just start to get going last week in time to be curtailed by the holiday. Finding specific structures to match inquiries remains a challenge as issuance volume remains light. Bid list inquiries and swap activity picked up some as prices rose. Depositories still seemed focused on stable structures with 4- to 5.5-year average lives, especially VADM type structures.

Rates and Refis




Dan Stimpson, CPA

Senior Vice President

Vining Sparks

The information included herein has been obtained from sources deemed reliable, but it is not in any way guaranteed, and it, together with any opinions expressed, is subject to change at any time. Any and all details offered in this publication are preliminary and are therefore subject to change at any time. This has been prepared for general information purposes only and does not consider the specific investment objectives, financial situation and particular needs of any individual or institution. This information is, by its very nature, incomplete and specifically lacks information critical to making final investment decisions. Investors should seek financial advice as to the appropriateness of investing in any securities or investment strategies mentioned or recommended. The accuracy of the financial projections is dependent on the occurrence of future events which cannot be assured; therefore, the actual results achieved during the projection period may vary from the projections. The firm may have positions, long or short, in any or all securities mentioned. Member FINRA/SIPC.
Copyright © 2021
This is a publication of Vining-Sparks IBG, L.P.
775 Ridge Lake Blvd., Memphis, TN 38120