6410 Poplar Avenue | Suite 320
Memphis, TN  38119

901.261.5900 Main | 800.664.5635 

MBS

9/20 – Good morning, folks! Congratulations, we made it to Friday. After an overall dovish FOMC meeting, and another rate drop of 25 bps, the S&P 500 got the nudge it needed to return the index to over 3,000 points. Equities are not the only assets affected by these rate cuts. 


August saw another increase in home purchases as people are finding it difficult to resist the low borrowing rates in the market right now. The average interest rate for a 30 year fixed mortgage issued in August is currently 3.77%. That is 11 bps lower than in July. These lower rates have led to the second straight month of sales growth. July and August brought month over month home buying increases of 2.5% an 1.3% respectively. This stream of new buyers has caused an increase in home values nationwide. The median single-family home value in August of 2019 was 4.7% higher than a year prior and condo prices increased 5.2% in that same period. We expect the Fed to continue cutting rates by the time their October meeting rolls around, so we should see this trend continue for this month and the next. 


In other mortgage-related news, we are currently seeing thirty-year fixed-rate mortgages with 3% coupon rates trading at 101-06, with a yield of 2.75%, and a spread of +107. When it comes to treasuries, three-month and ten-year bonds are yielding 1.87% and 1.77% respectively. That’s all we have for today. We trade SBA, USDA, CRA, MBS, and whole loan products. If you do too, we would love to give you a hand. Have a great weekend!


Mortgage Backed Securities

Five Minute Maturity

Check out this video regarding Mortgage Backed Securities. 

Hanover Securities Cherry Picks

September 16, 2019

ARMS / FLOATERS

Cost:

Average Life:

Yield:

Speed:

Spread:

Coupon:

Lifetime Cap:

WAM:

Loans:

Factor:

Caps:

Floor:

1 Yr. Libor

$7mm+ Fannie Mae 5/1 ARM 3.39% #BJB400 7/49 stated final

$102-28+

3.2 yr

2.39%

15% CPB

+75/Z curve

3.39%

8.116% 

357

32

.9890

2/2/5

1.610

+1.610

10 YEAR FIXED

Cost:

Average Life:

Yield:

Speed:

Spread:

Coupon:

# Loans:

Origination:

Type:

WAM:

Factor:

$102-04+

4.0 yr

2.39%

154 PSA

+67/I curve

3.0%

242

2018/2019

Fannie Major

114

.9187

$8mm+ Fannie Mae 10yr am 3.00% #MA3710  6/29 stated final

15 YEAR FIXED

Cost:

Average Life:

Yield:

Speed:

Spread:

Coupon:

# Loans:

Origination:

Type:

WAM:

Factor:

$100-10+

5.3 yr

2.41%

188 PSA

+69/I curve

2.5%

5832

2019

Freddie Major

178

.9915

$7mm+ Freddie Mae Dwarf 2.50% 

#MA3764  9/34 stated final

20 YEAR FIXED

Cost:

Average Life:

Yield:

Speed:

Spread:

Coupon:

# Loans:

Origination:

Type:

WAM:

Factor:

$103-17+

4.6 yr

2.63%

287 PSA

+92/I curve

3.5%

150

2018/2019

Freddie Multi

228

.8480

$9mm+ Freddie Mac 20yr am 3.50% #C92035 2/39 stated final

30 YEAR FIXED

Cost:

Average Life:

Yield:

Speed:

Spread:

Coupon:

# Loans:

Origination:

Type:

WAM:

Factor:

$102-11

5.4 yr

2.96%

283 PSA

+125/I curve

3.5%

7,587

2018/2019

FNMA Major

350

.8722

$10mm Fannie Mae 30 yr am 3.50% #MA3614      3/49 stated final

AGENCY CMBS

Cost:

Average Life:

Yield:

Speed:

Coupon:

Call Protection:

Tier

GEO:

DSCR:

LTV:

OCC:

Factor:

$108-21+

8.7 yr

2.56 +85/swaps

0% CPY

3.63%

71 mo Yield Maintenance

2

MI

1.37x

70%

91.5%

1.0000

$10mm FNMA 10/7  DUS #387983

3.63% coupon     8/2028 stated final

AGENCY CMO - 3 YEAR

Cost:

Average Life:

Yield:

Speed:

Spread:

Collateral:

Coupon:

Band:

Avg Life:

      w/ rates +300:

Factor:

$101-03

3.6yr

2.62%

400 PSA

+90/I curve

FNMA 30yr 4.00%

3.00%

none


10.1 yr 

.8590

$10mm Fannie Mae   Pass Thru 3.00% 

#FNR 2018-5B B   8/48 stated final

AGENCY CMO - 5 YEAR

Cost:

Average Life:

Yield:

Speed:

Spread:

Collateral::

Coupon:

Band:

Avg Life:

   w/ rates +300

Factor:

$101-11

4.1 yr

2.62%

350 PSA

+90/I curve

Jumbo 30yr 4.50%

3.0%

none


9.5 yr 

.3643

$10mm+ Freddie Mac Busted PAC 3.00% 

#FHR 4538 DB     12/45 stated final

AGENCY CMO - LONG END

Cost:

Average Life:

Yield:

Speed:

Spread:

Collateral:

Coupon:

Band:

Avg Life:

  w/ rates +300

IO till:

Factor:


$103-13+

12.0 yr

2.66%

474 PSA

+75/I curve

New Fannie  Relo 3.00%

3.0%

124-278


16.9 yr 

1/2029

1.0000

$1.2mm Fannie Mae  AD PAC 3.00% 

#FNR 2018-24 HB     4/48 stated final

Jim Tait is a registered representative with, and offers securities through Hanover Securities, Inc. (Hanover), Member FINRA & SIPC. Although this information has been obtained from sources we believe reliable, we do not guarantee its accuracy, and it may be incomplete or condensed. This is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Securities which may be shown are subject to availability and changes in price. Past performance is not indicative of future results. Changes in any assumptions may have a material effect on projected results.


This information from Hanover Securities is for your private use and does not constitute an offer or solicitation with respect to the sale of any security. This information was obtained from sources we believe to be reliable but we do not represent that it is accurate or complete, and it should not be relied on as such. Certain transactions may give rise to substantial risk and are not suitable for all investors. This information was based on current market indicators which may vary over time. We may from time to time buy or sell, or have long or short positions in securities identical or related to those identified herein. 


Although this information has been obtained from sources we believe reliable, we do not guarantee its accuracy, and it may be incomplete or condensed. This is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Loans and/or Securities which may be shown are subject to availability and changes in price. Past performance is not indicative of future results. Changes in any assumptions may have a material effect on projected results. This information from Banes Capital Group (BCG) and/or Hanover Securities is for your private use, and was obtained from sources we believe to be reliable. However, we do not represent that this information is accurate or complete, and it should not be relied on as such. This information is for institutional investors only, and as such certain transactions may give rise to substantial risk and are not suitable for all investors. This information was based on current market indicators which may vary over time. We may from time to time buy or sell, or have long or short positions in loans or securities identical or related to those identified herein. 


The pricing of loans or any Level II or III asset is inherently an exercise in quantifying uncertain variables. As such, great care should be taken when pricing loans for reporting purposes. The information included herein should never be taken as the sole method, or even a method to be relied on, for the pricing of loans or other Level II or III assets as this is for informational purposes only.

Copyright © 2018 Banes Capital Group, LLC

 Legal Notice | Privacy