DAILY MARKET BRIEFING:

Mortgage Trends & Rate Activity

MARKET RATE INDICES

Daily Market Briefing: Mortgage Trends & Rate Activity

Market Index Current Rate 1-Day Delta 7-Day DeltaDelta Since

2/18/20

30-YR Conforming 2.98%

30-YR Jumbo 3.25%

30-YR FHA 3.09%

30-YR VA 2.71%

Source: Optimal Blue Mortgage Market Indices (OBMMI) – optimalblue.com/obmmi2

2.6%

2.8%

3.0%

3.2%

3.4%

3.6%

3.8%

4.0%

4.2%

Rates were quiet across the

board on Friday.

30-YR CONFORMING TO 10-YR TREASURY RATE SPREAD

Market Index Current Value 1-Day Delta 7-Day DeltaDelta Since

2/18/20

10-YR Treasury 0.59%

30-YR Conforming 2.98%

10-YR to 30-YR Spread 2.39%

Source: Optimal Blue Mortgage Market Indices (OBMMI) – optimalblue.com/obmmiU.S. Department of the Treasury – treasury.gov

3

Daily Market Briefing: Mortgage Trends & Rate Activity

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

4.5%

The 30-year conforming to

10-year treasury spread was

virtually unchanged yesterday.

2.9%

3.1%

3.3%

3.5%

3.7%

3.9%

4.1%

0

50

100

150

200

250

300

350

400

450

500

RATE LOCK VOLUME BY LOAN PURPOSE

Source: Optimal Blue Mortgage Market Indices (OBMMI) – optimalblue.com/obmmiOptimal Blue Market Analytics – optimalblue.com/market-analytics

Market Volume Index Current Value 1-Day % Change 7-Day % Change% Change Since

2/18/20

Purchase 85

Cash-out Refinance 33

Rate-Term Refinance 124

Total 241

Refinance Share* 64.9%

4

(Total Volume indexed to 100 on 1/2/2020)

OBMMI 30-YR Conf.

Daily Market Briefing: Mortgage Trends & Rate Activity

*Refinance Share changes reflect inter-period delta

Lock volume dropped 20-25%

for all loan purposes on Friday.

MIX OF BUSINESS BY LOAN PRODUCT

Source: Optimal Blue Market Analytics – optimalblue.com/market-analytics5

Loan Product Mix Current Value 1-Day Delta 7-Day DeltaDelta Since

2/18/20

Conforming 72.6%

Non-Conforming 7.1%

FHA 8.7%

VA 10.8%

USDA 0.9%

Daily Market Briefing: Mortgage Trends & Rate Activity

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Conforming loans lost over 250

bps in share on Friday,

primarily to non-conforming

(up 112 bps), FHA (up 43 bps),

and VA (up 98 bps).

PURCHASE & REFINANCE PULL-THROUGH RATES

Daily Market Briefing: Mortgage Trends & Rate Activity

Pull-through Rate Current Rate 1-Day Delta 7-Day DeltaDelta Since

2/18/20

Purchase Pull-through 80.3%

Refi Pull-through 70.5%

Source: Optimal Blue Hedge Analytics – optimalblue.com/hedge-analytics6

60%

65%

70%

75%

80%

85%

90%

(5-Day Moving Average)

Purchase pull-through was

down 30 bps on Friday, while

refi pull-through gained 89

bps.

BEST EFFORTS TO MANDATORY DELIVERY SPREADS

Daily Market Briefing: Mortgage Trends & Rate Activity

Best Efforts vs. Mandatory Current Spread 1-Day Delta 7-Day DeltaDelta Since

2/18/20

30-YR Conforming 52 bps

15-YR Conforming 42 bps

30-YR Government 38 bps

7

bps

20 bps

40 bps

60 bps

80 bps

100 bps

120 bps

140 bps

160 bps

180 bps

(5-Day Moving Average)

Source: Optimal Blue Hedge Analytics – optimalblue.com/hedge-analytics

Best efforts to mandatory spreads

were quiet on Friday and are drifting

lower as the market continues to

solidify. These spreads are almost

back to "normal," a signal that we

are maintaining a steady recovery in

secondary market prices. Combined

with higher volume and margins,

these spreads contribute to a major

improvement in gains for most

lenders.

WHOLE LOAN DELIVERY TO 30-YR TBA SPREADS

Daily Market Briefing: Mortgage Trends & Rate Activity

8

(700 bps)

(600 bps)

(500 bps)

(400 bps)

(300 bps)

(200 bps)

(100 bps)

bps

100 bps

Source: Optimal Blue Hedge Analytics – optimalblue.com/hedge-analytics

(All Spreads indexed to 0 on 2/3/2020)

Whole Loan vs. 30-YR TBA Current Spread 1-Day Delta 7-Day Delta 4-Week Delta

Best Ex vs. UMBS 3.0 (223 bps)

Best Ex vs. GNMA 3.0 (84 bps)

Cash Window vs. UMBS 3.0 (128 bps)

Best Ex prices gained 2 bps versus

UMBS 3.0 and 126 bps versus GNMA

3.0 Friday. Cash window spreads

versus the UMBS 3.0 gained 23 bps.

We continue to see gradual

improvement in spreads. This

dynamic is significantly enhancing

gains over already elevated margins

and BE/Mand spreads, which are

combining to generate record

earnings for most lenders.

OPTIMAL BLUE DATA SOLUTIONS

Optimal Blue, LLC | optimalblue.com9

ENTERPRISE ANALYTICS

MARKET ANALYTICS

COMPETITIVE ANALYTICS

OPTIMAL BLUE MORTGAGE MARKET INDICES (OBMMI)

Daily Market Briefing: Mortgage Trends & Rate Activity

LEGAL DISCLAIMER

© Optimal Blue and/or certain of its affiliates. All rights reserved.10

Daily Market Briefing: Mortgage Trends & Rate Activity

DISCLAIMER

CONTENT USE PERMISSION

UTILIZING OUR CONTENT

TRADEMARKS

COPYRIGHT

REVISIONS