Fannie Mae, Freddie Mac MBS Prepayments Continue to Drop

The downward trend in agency mortgage-backed securities prepayments has continued in the latest month with speeds dropping more than expected, according to a Credit Suisse report issued late Wednesday.

Overall 30-year conventional speeds dropped 8% and 15-year conventional speeds fell 5% in October when compared to the previous month, foiling expectations for a 5% increase in both sectors’ speeds.

“This month’s slowdown reinforces market expectations of tame speeds despite the post-September [Federal Open Market Committee] rally in rates,” Credit Suisse researchers said in the report.