October 31st, 2008 12:13 pm | by John Jansen |

Mortgages are keeping pace with swaps and are three basis points to four basis points tighter on the day. On balance, there has been better buying and the market should maintain its firm tone as the index buyers emerge for month end.

One dealer writes that FNMA 5s have been in a wide range between 93 24/32 and 98 24/32 and with a current price around 95 they are in the bottom of that range. The writer notes that this is good news for prospective buyers but bad news for the housing market as the all in rate for a 30 year mortgage is aound 7 percent.

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  1. One Response to “MBS”

  2. By Name on Nov 1, 2008 | Reply

    Hypothetically, if MBS rates were to keep rising till they reached a point where MBS’s seemed attractive enough for buyers, what is your estimate of the all-in rate at that point? Would that not give a good estimate of what home values should drop to? Something I still don’t quite understand about the MBS market is why the rates are so similar across locales when there are clearly very levels of appreciation/depreciation built in from known macro-economic factors.

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