FICO Scores and LTV Called Key to Prepayment Speeds
June 30, 2003
Thanks to new loan-characteristics disclosures from Fannie Mae and Freddie Mac on their mortgage pass-through securities, Wall Street is getting a better idea on which loans are most likely to prepay in the conventional conforming market. Similar information has been available about the non-agency MBS market for some years and has allowed dealers to fine-tune their prepayment models for key loan characteristics.