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MCM Hedge Optimization
New Float Down Lock Structure provides borrowers protection for up to 180 days with no upfront fee
Rate Protection Program - Float Down Protection - Spot Builder Commitment
Bond Market Option Traders are not pricing in potential market volatility due to either the election or a viable vaccine. Or they think they will cancel out.
New MCM Hedge Commander System: Calibrate, Focus, Execute
I'm sure all market participants now know what it means to be Wipsawed by the market. Here is a presentation on the subject from last August 2019.
Who needs options?
1. Mortgage bankers whose Pipelines have high Fallout volatility exposure – and need to avoid the whipsaw effect - what does this mean? Here is an example.
Recently, correspondent lenders across the board have pulled back drastically on their pricing for all loans that they previously purchased for securitization purposes.
Stabilize the TBA mortgage backed securities market, instead of announcing big purchases (greater than daily production)
The moral hazard issue regarding mortgage servicing and its primary cause stems from the GAAP accounting ruling (FAS ASC 860-50-25-1.)
The agencies have gone off a cliff - these graph are ugly!
the spread between what “Bulk” investors are paying for various loan rates and programs versus what those loans are hedged with – TBA mortgage backed securities.
In the current environment, we are starting to see a great number of people getting laid off or other temporary work adjustments.
how do you deal with stretched processing timelines, borrowers calling to renegotiate, and/or adjusting hedge positions?
MCM Pipeline Management Optimization Techniques and Systems