JAN 13, 2014 12:16pm ET

Prepays to Drop 20% This Month: Credit Suisse

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There will be 20% drop in 30-year prepayments and an 18% decline in the 15-year January speeds due to higher rates and pronounced seasonal slowing, according to Credit Suisse’s forecast.

“Speeds should continue to drop in February by an additional 10%-15% on lower day-count and a further increase in the driving mortgage rates,” Credit Suisse researchers said in a forecast report revised Friday.

Aggregate 30- and 15-year conventional speeds in December were up but by less than expected at 3% and 4%, respectively.

Stable Ginnie Mae speeds also were slower than expected in December, when researchers had expected an increase.

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