Investment banks’ researchers generally indicated that agency mortgage-backed securities prepayments overall increased modestly in the latest month.
Keefe, Bruyette & Woods data, for example, show total prepayments for Fannie Mae came in at a constant prepayment rate of 24.1% as compared to 23.2% CPR the previous month, while Freddie Mac prepays came in at 25.8% CPR as compared to 25.5% CPR the previous month.
Barclays’ researchers said the no-point mortgage interest rate was about 15 basis points lower that the previous month’s comparable rate. But recent loan application response as measured by the Mortgage Bankers Association’s refinancing index suggests rates must continue to rally to maintain the same level of refinancing.
Credit Suisse said one anomaly in the latest prepayment report was a prepayment spike in 2011 vintage Fannie Mae 3.5s driven by increased third-party originator speeds.
