Things at Ocwen just went from bad to much, much worse

Things at Ocwen just went from bad to much, much worse

Embattled company hit with an avalanche of bad news

Pending home sales surge to highest level in 18 months

Buyer demand boosts sales

Foreclosure: The Movie… (finally!) coming to a screen near you

In new film, neighborhood of foreclosed homes drives man insane
W S
Investments

Refinancing application speeds likely to decline

Combined January refinancing application speeds are expected to decline by 8% for conventional 30-year mortgage rates and 15-year mortgage rates, analysts with Bank of America Merrill Lynch (BAC) said. 

Also, Ginnie Mae mortgage rates are projected to decline by 5% for January.

The Mortgage Bankers Association conventional refinancing index mirrored these projections, falling 7% from November to December, while the government index fell 4% for the same period. 

Thus, analysts project a 30-year mortgage rate of 3.27% and a 15-year mortgage rate of 2.57% for January. Both of those rate projections are down approximately one basis point from December, according to ()

Faster than anticipated prepays in December are the likely result of delayed closings on high application volumes in September to October.

Rising application volumes in the second half of 2012 increased the time it took to process applications as servicing capacity reached its limit. As a result, this increase in the loan closing timeline caused a lag in application processing, which delayed prepayment speeds overall.

"Low application volumes in November and December should further normalize the relationship between prepays and application volumes in coming months," the report said.

Click on the graph to view refinancing applications declined through January.

 

Speeds on HARP loans rebounded in December to levels nearing the October peak for prepayment speeds. 

As a result, HARP speeds will be biased higher over the next month, BofAML said.

"Recent servicing transfers speak to the potential for growing industry capacity and pose upside risk to higher coupon prepays, especially in Fannies," the report said.

cmlynski@housingwire.com

Recent Articles by Christina Mlynski

Comments powered by Disqus