Refinance loans accounted for less than half of the collateral securitized in agency MBS in July for the first time in nearly two years. (Includes two data charts.)

Purchases of refinance loans since December 2020 generated roughly $6.6 billion in adverse market refi fees for Fannie and Freddie, boosting them to a seven-year high in net income in the second quarter. (Includes data chart.)

Why compete against the Fed for agency MBS? Sometimes, shrinking is a better strategy, which is what the mega "mREITs" are doing.

Late last month, inter-dealer brokers began using SOFR for dollar swaps, allowing ARRC to finally recommend use of Term SOFR. 

It’s easier for banks to complete buyouts of mortgages from Ginnie MBS than nonbanks due to banks’ funding advantages. Nonbanks are also increasingly modifying mortgages rather than offering partial claims. 

The mortgage giant’s $3.6 billion profit for the second quarter benefited by as much as $1 billion in revenue from the controversial adverse market refinance fee.

Ginnie Mae buyouts have remained strong this year as more issuers try their luck at the rehab game. But how long might this trade last? Several more quarters, at least. (Includes data chart.)

Analysts say dollar rolls and spec pools still provide an opportunity for investors in the agency MBS market.

A mutual fund giant wants to convert Capstead’s cash base into commercial assets, leaving the residential world behind. The goal: higher returns for investors.

MBS trading came under pressure last month. But that was before rates dropped. Coming soon: more volatility...