Loan Pricing Comparison: Mixed Reviews. Less Rebate on Average
Upon first inspection loan pricing looked better this AM, then I got a few more rate sheets and realized that wasn't the case. Two of the major lenders passed along improved day over day pricing, but those gains were modest at most. On average, rate sheets are 9.1bps worse today. The note rates we would consider "near record lows" took the brunt of the rebate reductions. These day over day losses don't change the fact that a well-qualified borrower's BEST EXECUTION is 4.50%.
4.375% offers are on the table for borrrowers with no LLPA's who want to permanently buydown their mortgage rate by paying points at closing.
15&30 day locks are floating against the September Delivery Fannie Mae 4.0 and 4.5 MBS coupons, both of which are trading near session low prices and yield spread wides. The FNCL 4.0 is -0-06 at 101-10. The FNCL 4.5 is -0-03 at 103-17. The secondary market current coupon is 2.1bps higher at 3.768%.
Higher price levels have clearly been rejected. Volume in the TBA market is low.
Since reprices for the worse were largely baked in on first run loan pricing offers, broad based reprices for the worse are unlikely at current price levels. The lenders who priced better out the gate are your biggest risk to recall for the worse.