Prepayments and Refinancing Reflect a Friendly Falling Rate Environment

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Posted To: MND NewsWire

May mortgage performance data indicates that the mortgage finance industry might consider shifting priorities for a while. Black Knight, in the current edition of its Mortgage Monitor, points to the heavy prepayment risk for especially for adjustable rate mortgage (ARM) borrowers shown in the report and the growing pool of financeable mortgages. It is time, Black Knight says, for lenders and servicers to focus attention on retention so their existing customers don’t refinance elsewhere. Behind both of the activities cited, of course, is the continuing retreat of interest rates. On Thursday Freddie Mac announced another 11-basis point (bp) slide in its mortgage rate, bringing it to 3.73 percent, a three-year low. The Monitor has reported in several of its recent editions about the growing pool…(read more)

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