While Fannie began accepting single-family SOFR-indexed ARMs in Au-gust, it stopped taking LIBOR-indexed mortgages at the end of September. By the end of the year, the enterprise will no longer issue LIBOR-linked MBS.
The economic effects of the pandemic have slowed refi activity for investment properties. That, in turn, has dampened prepayment speeds for 100% investment-property pools, Wells Fargo Securities said.
The New York Federal Reserve purchased $9.81 billion in agency MBS on Monday and Tuesday, in addition to $22.89 billion bought last week. It’s been nearly three weeks since it sold any of its MBS holdings.
Over the last couple of weeks, the Federal Reserve has slowly tapered its MBS purchases. But even with healthy MBS prices, mortgage rates remain higher than formula dictates.