PennyMac Mortgage Investment Trust

Most Recent

  • uploads///LPS originations
    Financials

    Why low mortgage origination volumes are bad for REITs

    Mortgage originators have had a difficult time over the past year, as rates have begun rising. The increase in interest rates pretty much stopped the refinance boom in its tracks.

    By Brent Nyitray, CFA, MBA
  • uploads///Initial Jobless Claims
    Financials

    Initial jobless claims jump

    Initial jobless claims rose to an annualized rate of 360,000 for the week ended May 10th Initial jobless claims are one of the few labor market indicators that are released every week. Unemployment is a profound driver of economic growth, and persistent unemployment has been the Achille’s heel of this recovery. While it seems like […]

    By Brent Nyitray, CFA, MBA
  • uploads///Fed  GDP forecast
    Macroeconomic Analysis

    October FOMC Minutes Show the Economy Is Improving

    According to the October FOMC minutes, the Fed members noted that industrial production had fallen, which they attributed to the rise in the US dollar.

    By Brent Nyitray, CFA, MBA
  • uploads///Mortgage Rates
    Financials

    Why mortgage rates declined after the FOMC maintained its course

    Interest rates fell sharply across the board as the Fed voted to maintain its current rate of asset purchases. The market was betting heavily that the Fed would begin to reduce purchases.

    By Brent Nyitray, CFA, MBA
  • uploads///Fed Assets
    Financials

    The Fed maintains its policy on reinvesting QE assets

    The Fed’s decision to reinvest QE assets in the markets affects REITs. It keeps a bid under TBAs, and it supports MBS values in general.

    By Brent Nyitray, CFA, MBA
  • uploads///Housing starts
    Financials

    Must-know: What to watch for in real estate this week

    Mortgage real estate investment trusts (or REITs) like American Capital Agency (AGNC) and Annaly (NLY) will focus on data that will move the bond market.

    By Brent Nyitray, CFA, MBA
  • uploads///Fed  GDP forecast
    Financials

    Why has the recovery taken so long to arrive?

    The recovery hasn’t been satisfying. Due to consumption and consumer deleveraging, the necessary spending isn’t generated to pull the economy out of its slow growth pattern.

    By Brent Nyitray, CFA, MBA
  • uploads///Fed  GDP forecast
    Company & Industry Overviews

    Why the FOMC Statement Is Constructive on the Economy

    The FOMC didn’t change its characterization of the economy. The labor markets are improving, economic growth slowed, and household spending moderated.

    By Brent Nyitray, CFA, MBA
  • uploads///CIM Q
    Fund Managers

    Chimera posts growth in third quarter profit and interest income

    Chimera’s core earnings grew to $116 million compared to $93 million in the year-ago period. Growth was mainly due to an increase in net interest income.

    By Samantha Nielson
  • uploads///CoreLogic Home Price Index  year
    Consumer

    Must-know: Home prices increase 7.4% YoY

    The 7.4% year-over-year (or YoY) gain resembles the gains we saw during the bubble years. On a month-over-month basis, the increase was only 1.2%. It was decent. The prices for ex-distressed sales increased 6.8%. Prices are still 11.9% below their peak in April 2006.

    By Brent Nyitray, CFA, MBA
  • uploads///FHFA House Price Index
    Financials

    April Federal Housing Finance Agency House Price Index rose 7.4%, good for investors

    The Federal Housing Finance Agency (FHFA) House Price Index The FHFA House Price Index differs from the other house price indices like Case-Schiller and Radar Logic in that it only looks at houses with mortgages guaranteed by Fannie Mae and Freddie Mac. This means all the home prices are below the conforming threshold, which is $417,000. […]

    By Brent Nyitray, CFA, MBA
  • uploads///Fed  Unemployment Forecast
    Financials

    Why The Fed Continues To Anticipate Lower Unemployment

    At the March 2013 meeting, the Fed was forecasting that 2015 unemployment would be 6.7%–7%. Now, the Fed is forecasting that unemployment will be 5.2%–5.3%.

    By Brent Nyitray, CFA, MBA
  • uploads///MSR
    Financials

    Consumer Financial Protection Bureau rose cost of loan servicing

    Regulatory risks One of the other big risks for holders of mortgage servicing rights (MSRs) is the Consumer Financial Protection Bureau (CFPB). While the servicer’s job is to look out for the bondholders, the regulators are tasked with looking after the borrower. First, one of a servicer’s jobs is dealing with the borrower once a […]

    By Brent Nyitray, CFA, MBA
  • uploads///MFA Financial
    Financials

    Why home price appreciation has saved MFA Financial

    MFA Financial is a REIT that invests in both agency and non-agency mortgage-backed securities MFA Financial (MFA) is a mortgage real estate investment trust (REIT) that invests in both agency (government-guaranteed) and non-agency (non-guaranteed) mortgage-backed securities (MBS). Its portfolio is primarily invested in hybrids, adjustable-rate mortgages (ARM), and 15-year fixed-rate mortgages. It chooses to invest […]

    By Brent Nyitray, CFA, MBA
  • uploads///MBA Mortgage Apps
    Financials

    Massive mortgage market transformation: The return of subprime?

    The mortgage market is undergoing a massive transformation as the private label mortgage market returns.

    By Brent Nyitray, CFA, MBA
  • uploads///Fannie TBA LT
    Financials

    Primer on mortgage backed securities, Part 3

    Continued from Primer on mortgage backed securities, Part 2. Basic mortgage backed securities: Fannie Mae, Freddie Mac, and Ginnie Mae Most mortgage backed securities are agency securites, which means they are associated with government guaranteed loans. Fannie Mae and Freddie Mac are government sponsored entities (GSE’s) and do not carry an explicit government guarantee like Ginnie Mae mortgages do. […]

    By Brent Nyitray, CFA, MBA
  • uploads///Radar Logic Futures Curve
    Financials

    Radar Logic futures curve predicts flat real estate prices until September 2014

    Radar Logic futures can be used to forecast real estate prices Most people are unaware that there is a futures market for U.S. real estate prices.  The Radar Logic futures contract launched about a year ago on the CBOE Futures Exchange. While they are not especially liquid, they do provide an insight into what the market […]

    By Brent Nyitray, CFA, MBA
  • uploads///Fed GDP Forecast
    Consumer

    Preview of the week ahead: All about the September FOMC minutes

    Next week is all about the FOMC (Federal Open Market Committee) minutes The FOMC (Federal Open Market Committee) will release the minutes from the September meeting on Wednesday. The Fed-speak indicates that it was a close call between tapering at the September meeting and not. Market participants will parse the minutes closely, although the government […]

    By Brent Nyitray, CFA, MBA
  • uploads///Black Knight Origination Volume
    Financials

    Why more mortgage originators venture into the non-qualified space

    The Consumer Financial Protection Bureau promulgated a list of requirements for a mortgage to be considered a qualified mortgage (or QM). On January 1, the new QM rules took effect.

    By Brent Nyitray, CFA, MBA
  • uploads///delinquencies
    Financials

    Mortgage delinquencies drop below 6%, helping REITs like PennyMac

    Black Knight Financial Services (formerly known as Lender Processing Services) is a vendor to mortgage originators, handling mortgage processing and default management outsourcing.

    By Brent Nyitray, CFA, MBA
  • uploads///MBA Mortgage Apps
    Financials

    Mortgage applications rebound after a short holiday week

    Mortgage applications fall off a cliff on a short week The MBA Applications index rose 11% after falling 13% the week before, which was a holiday-shortened week. Refinances drove the increase, with an 18% jump in the index. Purchase activity also rose, although only slightly. The summer selling season is winding down, and we’re entering […]

    By Brent Nyitray, CFA, MBA
  • uploads///Mortgage Delinquencies
    Financials

    Mortgage delinquencies tick up in June: Blip or trend change?

    Ninety-day mortgage delinquencies rebound to 6.7% after hitting 6.1% in May Mortgage delinquencies are falling as home prices rise and the foreclosure pipeline is clearing. While 6.7% seems low compared to the peak of 10%, the “normal” level prior to the housing bubble was in the 4%-to-5% range. This also reflects the mortgage modification push […]

    By Brent Nyitray, CFA, MBA
  • uploads///Mortgage Rates
    Financials

    Why did the mortgage rates flatten after a mixed jobs report?

    The average 30-year fixed-rate mortgage rose 1 basis point, from 4.34% to 4.35%, while the ten-year bond yield was flat after a mixed jobs report.

    By Brent Nyitray, CFA, MBA
  • uploads///Mortgage Rates
    Financials

    Mortgage rates fall as the bond market rallies

    The average 30-year fixed-rate mortgage fell 3 basis points, from 4.17% to 4.14% this week. The ten-year bond yield fell 4 basis points.

    By Brent Nyitray, CFA, MBA
  • uploads/// year bond yield historical
    Financials

    Is the secular bond bull market over? A primer on interest rate risk, Part 6

    Back to Part 5 Non-agency mortgage backed securities – interest rate risk and credit risk When we think of non-agency paper, we have both interest rate risk and credit risk. The interest rate risk borne by non-agency mortgage backed securities is more or less the same as agency paper. They have the same exact issues […]

    By Brent Nyitray, CFA, MBA
  • uploads///FHFA home price index
    Financials

    FHFA Home Price Index rises in June, good for non-agency REITs

    The Federal Housing Finance Agency (FHFA) House Price Index The FHFA House Price Index differs from the other house price indices like Case-Shiller and Radar Logic in that it only looks at houses with mortgages guaranteed by Fannie Mae and Freddie Mac. This means all the home prices are below the conforming threshold, which is $417,000. It […]

    By Brent Nyitray, CFA, MBA
  • uploads///LPS originations
    Financials

    Why steeply falling originations mean bad news for non-agency REITs

    Mortgage originators have had a difficult time over the past year, as rates have begun rising. The increase in interest rates pretty much stopped the refinance boom in its tracks.

    By Brent Nyitray, CFA, MBA
  • uploads///Initial Jobless Claims
    Financials

    Why initial jobless claims jumped on the government shutdown

    Initial jobless claims increased to an annualized rate of 374,000 for the week ended October 4. Unemployment has been the Achilles’ heel of this recovery.

    By Brent Nyitray, CFA, MBA
  • uploads///CoreLogic Home Price Index  year
    Consumer

    The CoreLogic Index shows home price appreciation is decelerating

    The CoreLogic Index is a widely followed index of real estate values. Unlike the other major indices—like Case-Shiller or Radar Logic—CoreLogic separates distressed sales from non-distressed sales.

    By Brent Nyitray, CFA, MBA
  • uploads///Leverage
    Financials

    Leverage and mortgage REITs – Part 2

    Leverage and Mortgage REITs – Part 1 How a mortgage REIT typically does it Most mortgage REITs use repurchase agreements to fund their balance sheet. A repurchase agreement (repo) is basically a secured loan. The REIT will pledge the mortgage backed securities they just bought as collateral for a loan. It is actually an agreement […]

    By Brent Nyitray, CFA, MBA
  • uploads///MFA Financial
    Financials

    MFA Financial portfolio yield continues to drop

    MFA Financial is a REIT that invests in both agency and non-agency mortgage backed securities MFA Financial (MFA) is a mortgage Real Estate Investment Trust (REIT) that invests in both agency (government guaranteed) and non-agency (non-guaranteed) mortgage backed securities. Their portfolio is primarily invested in hybrids, adjustable rate mortgages (ARM), and 15 year fixed rate […]

    By Brent Nyitray, CFA, MBA
  • uploads///MBA Refinance Index
    Financials

    Refinances tick up as bond market sell-off takes a breather

    The MBA Refinance Index is an important index to forecast mortgage activity and prepayments The Mortgage Bankers Association (MBA) Index of Refinance Activity measures application activity, not loans made. The Mortgage Bankers Association samples roughly 75% of all mortgage activity in the U.S., and its indices are key indicators for the real estate finance market […]

    By Brent Nyitray, CFA, MBA
  • uploads///Case Schiller
    Financials

    S&P/Case-Shiller Home Price Index rises in March

    The Standard and Poor’s/Case-Shiller index of real estate prices increased 10.9% year-over-year in March, hinting that the real estate market bottomed around this time last year. The Case-Shiller index The Case-Shiller index is the most widely quoted index of real estate values. Real estate values are big drivers of consumer confidence and spending, and, therefore, […]

    By Brent Nyitray, CFA, MBA
  • uploads///MFA Financial
    Financials

    Why MFA Financial benefits from increasing real estate prices

    Over the past 12 months, MFA has paid a dividend yield of over 20% when you take into account two special dividends.

    By Brent Nyitray, CFA, MBA
  • uploads///Convexity
    Financials

    Primer on mortgage backed securities, Part 5

    Continued from Primer on mortgage backed securities, Part 4. Prepayment risk Prepayment risk and interest rate risk go hand-in-hand. The main difference between a mortgage backed security and a government bond is that with a government bond, you know exactly when you will get your principal and interest payments. If you purchase a 7-year Treasury […]

    By Brent Nyitray, CFA, MBA
  • uploads///Fannie Mae Attitudes about housing good time to buy
    Consumer

    An introduction to the Fannie Mae National Housing Survey

    Homebuilders use the survey data to measure consumers’ attitude towards future home price appreciation. Mortgage REITs use the survey data to help forecast prepayment speeds and also to gauge consumer sentiment.

    By Brent Nyitray, CFA, MBA
  • uploads///REITs Total Return
    Macroeconomic Analysis

    Real Estate Remains Weak but Rents Rise Faster than Inflation

    The benchmark iShares Dow Jones US Real Estate ETF (IYR) comprises 114 stocks. We can divide the ETF by market capitalization.

    By Arthur Penn
  • uploads///MBS tranching
    Financials

    Primer on mortgage backed securities, Part 1

    What are mortgage backed securities? Mortgage backed securities are pools of individual mortgages that have similar characteristics. They allow a relatively illiquid asset (an individual home mortgage) to be converted into a very liquid asset that can be traded with relative ease. They also allow an issuer to divide up the cash flows in order […]

    By Brent Nyitray, CFA, MBA
  • uploads/// year bond yield historical
    Financials

    Is the secular bond bull market over? A primer on interest rate risk, Part 4

    Back to Part 3 Interest rate risk and mortgage backed securities Mortgage backed securities have different interest rate risk than conventional Treasuries and corporate bonds. This is because of prepayment risk. When interest rates fall, borrowers will typically refinance their mortgages. To an investor, they will get their pro-rate allocation of principal early. They will not get […]

    By Brent Nyitray, CFA, MBA
  • uploads///Fannie Mae Attitudes about housing good time to buy
    Real Estate

    Background on Fannie Mae National Housing Survey

    Fannie Mae puts out a monthly National Housing Survey that measures consumers’ attitudes about housing and the economy. In many ways, it’s similar to the consumer confidence indices. However, the majority of the questions relate to real estate.

    By Brent Nyitray, CFA, MBA
  • uploads///MBA Mortgage Apps
    Financials

    Mortgage applications increase 7% for the week ending May 3

    Mortgage applications, as reported by the Mortgage Bankers Association, rose 7% for the week ending May 3rd in spite of a five basis point increase in mortgage rates Mortgage applications are primarily interest-rate driven. Applications typically increase as rates fall because home owners take advantage of the drop in rates to refinance. Conversely, they fall […]

    By Brent Nyitray, CFA, MBA
  • uploads///MSR
    Financials

    Why mortgage servicing rights imply risks for servicers

    Risks of being a servicer Generally, servicing seems like an easy job. Collect the payment, give the government its take, pass the (smaller) payment to the bondholders, and keep the rest. What could go wrong? There’s just one catch. What happens if you miss your mortgage payment? The U.S. government guarantees Ginnie Mae securities. When […]

    By Brent Nyitray, CFA, MBA
  • uploads///Leverage
    Financials

    Leverage and Mortgage REITs – Part 4

    Leverage and Mortgage REITs – Part 4 Liquidity risk Even if borrowers make their payments, jitters in the mortgage backed security market can hit liquidity, making it difficult (if not impossible) for REITs to reduce leverage. REITs are also at the mercy of their bankers, who can pull lines of credit (or simply refuse to […]

    By Brent Nyitray, CFA, MBA
  • uploads///Fannie Mae Attitudes about housing good time to buy
    Consumer

    Why REITs focus on the Fannie Mae National Housing Survey

    Mortgage REITs like Annaly (NLY), American Capital Agency (AGNC), and PennyMac (PMT) will use the survey data to help forecast prepayment speeds and also to gauge consumer sentiment and its expected effects on the economy.

    By Brent Nyitray, CFA, MBA
  • uploads///sharon mccutcheon lnbXtxFGZw unsplash
    Financials

    Fed’s Balance Sheet swells to $3.2 Trillion

    The Fed’s balance sheet rose to over $3 trillion in Q1 as quantitative easing goes into overdrive.

    By Brent Nyitray, CFA, MBA
  • uploads///delinquencies
    Financials

    Mortgage delinquencies continue to dive, helping REITs like Annaly

    Black Knight Financial Services (formerly known as Lender Processing Services) is a vendor to mortgage originators, handling mortgage processing and default management outsourcing.

    By Brent Nyitray, CFA, MBA
  • uploads///Nonfarm Payrolls
    Financials

    Jobs Report: Why It’s the Highlight of the Week

    There isn’t much real estate–related economic data this week. There are some important macro reports as well as the jobs report on Friday.

    By Brent Nyitray, CFA, MBA
  • uploads///Fannie Mae Attitudes about housing good time to buy
    Macroeconomic Analysis

    Understanding The Fannie Mae National Housing Survey

    Fannie Mae puts out a monthly survey measuring consumers’ views on housing and the economy. The Fannie Mae National Housing Survey asks several questions.

    By Brent Nyitray, CFA, MBA
  • uploads///CoreLogic Home Price Index  year
    Consumer

    A good omen for builders: Home prices increase 13% year-over-year

    Real estate values are big drivers of consumer confidence and spending, so they have an enormous effect on the economy.

    By Brent Nyitray, CFA, MBA
  • uploads///MR Corelogc HPI
    Financials

    Must-know: Home prices hit their highest level since May 2008

    The 12% year-over-year gain resembles the gains we saw during the bubble years. Both distressed sales and non-distressed sales rose by similar amounts.

    By Brent Nyitray, CFA, MBA
  • uploads///delinquencies
    Real Estate

    Mortgage Delinquencies Hit Post-Bubble Lows

    In general, mortgage delinquencies fell to 5.4% due to home price improvements and clearing foreclosure pipelines. The normal level before the housing bubble was between 4% and 5%.

    By Brent Nyitray, CFA, MBA
  • uploads///Fannie Mae Attitudes about housing expected px appreciation
    Real Estate

    Fannie Mae’s survey shows an increase in home price appreciation

    The latest survey shows that consumers expect home price appreciation to increase by 2.5% over the next 12 months. This is up 20 basis points month-over-month.

    By Brent Nyitray, CFA, MBA
  • uploads///MBA Refinance Index
    Financials

    Are lower rates enough to trigger another refinance wave?

    The increase in rates has basically put prepayment worries on the back burner for REITs. The lack of a reaction in the refinance index on the back of a drop in rates could mean we’re finally seeing prepayment burnout. This would be good news for REITs.

    By Brent Nyitray, CFA, MBA
  • uploads///Mortgage Rates
    Consumer

    Mortgage Rates Fall Again As The 10-Year Rallies

    The rally in bonds has been an unexpected gift to cap off what was otherwise a dismal year in mortgage banking.

    By Brent Nyitray, CFA, MBA
  • uploads///MBA Refinance Index
    Financials

    An Old Headache Returns: Increased Prepayment Speeds Up

    The Mortgage Bankers Association (or MBA) Refinance Index rose 66% from 1,349 to 2,245 as rates finally fell enough to allow refinances.

    By Brent Nyitray, CFA, MBA
  • uploads///Retail Sales
    Consumer

    Disappointing retail sales affect commercial REITs

    Commercial retail REITs such as Simon Property Group (SPG) and General Growth Properties (GGP) focused most on disappointing retail sales data on Tuesday.

    By Brent Nyitray, CFA, MBA
  • uploads///Mortgage Delinquencies
    Financials

    Mortgage delinquencies tick up 6.08%

    Better economic times are helping lower mortgage delinquencies, but we still have some work to do clearing the foreclosure pipeline.

    By Brent Nyitray, CFA, MBA
  • uploads///MBA Refinance Index
    Financials

    MBA Refinance Index continues to fall

    The MBA Refinance Index is an important index to forecast mortgage activity and prepayments The Mortgage Bankers Association (MBA) Index of Refinance Activity measures application activity, not loans made. The Mortgage Bankers Association samples roughly 75% of all mortgage activity in the U.S., and its indices are key indicators for the real estate finance market […]

    By Brent Nyitray, CFA, MBA
  • uploads///Leverage
    Financials

    Leverage and mortgage REITs – Part 1

    The use of leverage is how REITs provide a high yield from low-yielding instruments Mortgage REITs, particularly agency REITs, use leverage to enhance returns. Agency REITs invest solely in government mortgage backed securities – either Fannie Mae, Freddie Mac, or Ginnie Mae. These securities do not have credit risk – in other words, even if […]

    By Brent Nyitray, CFA, MBA
  • A puzzle in mortgage rates
    Financials

    A puzzle in mortgage rates

    Mortgage rates are generally set by the TBA market which trades with the 10-year bond Mortgage rates generally follow interest rates pretty closely. The most important security for mortgage originators is the To-Be-Announced (TBA) market. The TBA market is the basis for which your loan originator prices a loan. When they make a loan to you […]

    By Brent Nyitray, CFA, MBA
  • uploads///Productivity
    Financials

    Non-farm productivity increases in Q1

    Productivity is a measure of output per unit of labor  Productivity increases allow wage increases without increasing inflation. The sister index to productivity is unit labor costs, and, unsurprisingly, the Bureau of Labor Statistics releases them together. Non-farm productivity is calculated by dividing an index of output by an index of hours worked. Productivity growth […]

    By Brent Nyitray, CFA, MBA
  • uploads///Initial Jobless Claims
    Financials

    Initial jobless claims fall to 324,000

    Initial jobless claims rose to an annualized rate of 324,000 for the week ended April 26th Initial jobless claims are one of the few labor market indicators that are released every week. Unemployment is a profound driver of economic growth, and persistent unemployment has been the Achilles heel of this recovery. While it seems like […]

    By Brent Nyitray, CFA, MBA
  • uploads///Case Schiller
    Financials

    Case-Shiller Index improves in February

    The Standard and Poor’s/Case-Shiller index of real estate prices increased 9.3% year-over-year in February, hinting that the real estate market bottomed around this time last year. The Case-Shiller index The Case-Shiller index is the most widely quoted index of real estate values. Real estate values are big drivers of consumer confidence and spending, and, therefore, […]

    By Brent Nyitray, CFA, MBA
  • uploads///Housing starts
    Financials

    Why Do Housing Starts Remain Muted?

    Housing starts and building permits came in around 1.2 million—towards the top end of a narrow range over the past year.

    By Brent Nyitray, CFA, MBA
  • uploads///foreclosure heat map
    Financials

    Why Are State Foreclosure Laws Important?

    There are two basic types of state foreclosure laws—judicial and non-judicial. In non-judicial states, foreclosures are handled through a streamlined process.

    By Brent Nyitray, CFA, MBA
  • uploads///Foreclosure percent
    Financials

    How Do Foreclosures Impact Mortgage REITs?

    The federal government has taken numerous steps to reduce foreclosures. It started with loan modification programs.

    By Brent Nyitray, CFA, MBA
  • uploads///Case Schiller
    Financials

    Week in Review: Adjusting to the Brexit Vote

    Last week was pretty light in terms of economic data, but markets were concerned with adjusting to the Brexit vote. For all the worries about Brexit overseas, it simply won’t have much of an effect on US corporate earnings.

    By Brent Nyitray, CFA, MBA
  • uploads///Fed  GDP forecast
    Company & Industry Overviews

    The FOMC Notes That Economic Growth Has Begun to Decelerate

    According to the April FOMC minutes, the staff believes that GDP growth has begun to decelerate. Industrial production and manufacturing output declined in February and March.

    By Brent Nyitray, CFA, MBA
  • uploads///Fed  GDP forecast
    Macroeconomic Analysis

    Why the Fed Lowered Its Forecast for 2016 GDP Growth

    During the March FOMC meeting, the Fed lowered its estimates for 2016 GDP growth from a range of 2.3%–2.5% to a range of 2.1%–2.3%.

    By Brent Nyitray, CFA, MBA
  • uploads///foreclosure heat map
    Macroeconomic Analysis

    Foreclosure Laws Impact Home Price Appreciation

    There are two basic types of state foreclosure laws—judicial and non-judicial. In non-judicial states, foreclosures are handled through a streamlined process.

    By Brent Nyitray, CFA, MBA
  • uploads///Top  Stocks in Subgroups
    Macroeconomic Analysis

    Only 7 IYR Stocks Earned Positive Returns in Mid-July

    Major stocks in the top five REIT subgroups that saw positive returns over the week ended July 17.

    By Arthur Penn
  • uploads///Black Knight Origination
    Financials

    Must-know: Understanding non-qualified mortgage loans

    Non-QM loans would typically be useful for borrowers with sporadic income, but a large amount of assets. However, lenders will only consider low loan-to-value (or LTV) loans—like 80% maximum, which really is a ceiling. Most lenders are below that.

    By Brent Nyitray, CFA, MBA
  • uploads///delinquencies brent HPs conflicted copy
    Financials

    Why 90-day delinquencies tick up slightly in June

    In general, mortgage delinquencies are falling as home prices rise and the foreclosure pipeline clears. While 5.7% seems low compared to the peak of 10%, the “normal” level prior to the housing bubble was in the range of 4%–5%.

    By Brent Nyitray, CFA, MBA
  • uploads///Mortgage Rates
    Financials

    Why mortgage rates rose as the 10-year bond sold off

    The average 30-year fixed-rate mortgage rose 2 basis points, from 4.15% to 4.17%, while the ten-year bond yield rose 11 basis points after some weaker economic data.

    By Brent Nyitray, CFA, MBA
  • uploads///HARP Refinances
    Financials

    A key guide to the left-versus-right divide on housing policy

    For the political right, the goal is to encourage private capital to return to the market and lower the government’s footprint in housing. For them, the goal is to “crowd in” private capital.

    By Brent Nyitray, CFA, MBA
  • uploads///Negative Equity
    Financials

    Must-know: Why increasing home prices are important for REITs

    The biggest economic challenge of the recovery has been the indebted consumer. Consumption has fallen as consumers have focused on repaying debt.

    By Brent Nyitray, CFA, MBA
  • uploads///Mortgage Rates
    Financials

    Mortgage rates rise 10 basis points on strong economic data

    The average 30-year fixed-rate mortgage rose 10 basis points, from 4.38% to 4.48%, while the ten-year bond rose 11 basis points.

    By Brent Nyitray, CFA, MBA
  • uploads///HAMP modifications
    Financials

    As FHFA Chairman, Mel Watt would probably embrace principal mods

    The current head of FHFA, Ed DeMarco, has steadfastly refused to consider principal mods because he views them as a losing proposition to the taxpayer.

    By Brent Nyitray, CFA, MBA
  • uploads///Initial Jobless Claims
    Financials

    Initial jobless claims fell slightly, good for non-agency REITs

    Initial jobless claims decreased to 339,000 for the week ended November 8. The financial industry is laying people off as the mortgage business dries up.

    By Brent Nyitray, CFA, MBA
  • uploads///Mortgage Rates
    Financials

    Why mortgage rates are falling as the government re-opens

    The average 30-year fixed-rate mortgage fell 2 basis points, from 4.28% to 4.23%, as the ten-year bond yield dropped from 2.69% to 2.88%.

    By Brent Nyitray, CFA, MBA
  • uploads///MR SGM
    Basic Materials

    Going public: Stonegate Mortgage acquires initial public offering

    Stonegate is the first pure-play mortgage originator we’ve seen since the housing bust. Most pure-play originators ended up going out of business.

    By Brent Nyitray, CFA, MBA
  • uploads/// year bond yield historical
    Financials

    Recommendation: How to play the REITs now that we have a deal

    The most lasting effect of the shutdown was probably in the Fed Many people in Washington were highly disappointed that the markets yawned at the government shutdown. They were hoping that a violent reaction might force Congress to get together and find some common ground. It didn’t happen, although the polling data was enough to […]

    By Brent Nyitray, CFA, MBA
  • uploads///MBA Mortgage Apps
    Financials

    Why mortgage applications rose despite the government shutdown

    Mortgage applications fall slightly The MBA Applications Index rose 0.3% after rising 1.2% the week before. Mortgage applications have dropped off a cliff ever since rates began increasing last spring. Both purchases and refinances drove the increase. The summer selling season is winding down, and we’re entering a slow period that will last through the […]

    By Brent Nyitray, CFA, MBA
  • uploads///MBA Mortgage Apps
    Financials

    Recommendation: What the shutdown means for mortgage originators

    Mortgage originators are in a tough environment After feasting on the refinance boom of 2012, mortgage originators are finding 2013 to be a much more inhospitable environment. Many banks had added little capacity and were able to make a fine living doing refinance activity, which is a technologically driven business led by price discovery. It’s […]

    By Brent Nyitray, CFA, MBA
  • Consumer

    Week in preview: Expect two big homebuilder earnings reports

    Next week is all about the FOMC (Federal Open Market Committee) meeting The FOMC meets on Tuesday and Wednesday, and we should have the announcement on Wednesday afternoon around 2:00 p.m. Taper? By how Much? Which securities? The Fed will also release its forecast of economic activity. The Fed has been consistently over-optimistic on economic growth, and […]

    By Brent Nyitray, CFA, MBA
  • uploads///IVR
    Financials

    Invesco Mortgage Capital book value per share declines 12%

    Invesco Mortgage Capital (IVR) is a mortgage REIT that focuses on agency and non-agency mortgage-backed securities Invesco invests in a wide range of products, from agency residential mortgage-backed securities, to non-agency mortgage-backed paper, to commercial mortgage-backed securities and residential and commercial mortgage loans. Invesco Mortgage Capital is externally managed by Invesco (IVZ). Its portfolio is […]

    By Brent Nyitray, CFA, MBA
  • uploads///Fannie Mae TBA
    Financials

    Fannie Mae mortgage backed securities sell off in the week ending 5/10

    Mortgage backed securities are the starting point for all mortgage market pricing, and are the investment of choice for mortgage REITs When the Federal Reserve talks about buying mortgage backed securities, it is referring to the To-Be-Announced (TBA) market. The TBA market allows loan originators to take individual loans and turn them into a homogeneous […]

    By Brent Nyitray, CFA, MBA
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