MBS Direction – Rates Still Higher

The last couple months we have seen the MBS market accelerate its sell off.  The question is: where will it end or settle out? The FNMA 4% coupon chart looks to a 4 year support level at 101.56.   Since last September we have lost nearly 350bps, with 230bps peeling off in just the last 2 and half months.  To get to the 101.56 support level the market still needs to shed 75BPS leaving mortgage rates to increase another .125-.25%.  If you are looking at buying or refinancing now is the time to lock in a rate.

2-15-18 MBS Direction

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