In this issue…
Update on Market Rates and Prepayments
Dick Kazarian, Managing Director, Borrower Analytics Group
Year to date, primary rates have backed up 40 bps while secondary rates have increased 67 bps. This means that the primary/secondary spread narrowed by 26 bps. This primary/secondary (P/CC) spread is driven by numerous factors, including g-fees, servicing costs, origination costs, and numerous other factors. Many of these factors change slowly over time and only impact the long run behavior of the P/CC spread. Read more…
Residential MSR Market Update – Q3 2021
Mike Carnes, Managing Director, MSR Valuations Group
MIAC Generic Servicing Assets (GSAs™) have seen YTD price increases across all sectors, with a UPB-weighted increase of 30.7%. Across Conventional products, pricing increased substantially more for 30-year than for 15-year. This is due to (a) 30-year primary rates increasing by more than 15-year primary rates, and (b) the higher (i.e., less negative) 15-year OADs (-14.9 vs. -23.7). Read more…
A Closer Look at the Impact of Loan Age on GNMA Prepayments in MIAC’s CORE™ Models
Dick Kazarian, Managing Director, Borrower Analytics Group
As we’ve discussed in previous reports and documents, our CORE™ multi-factor prepayment model incorporates all explanatory variables. We handle additional explanatory variables as over-rides to this base model. These expanded variables include FICO score, channel, loan purpose, occupancy, property type, and several others. Our software applications give users complete flexibility to incorporate any other desired variables, such as servicer, streamlined vs. cash-out refinance, prior modifications, HARP eligibility, etc. Read more…
View Previous MIAC Perspectives: Summer 2021 Issue
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