Video: Mortgage Market Evolution
As any mortgage market veteran will attest, the distribution and structure of the mortgage market is constantly in flux. When rates fall, at-the-money coupons become premiums, staffing at originators rises, the volume of refis increase, and the distribution and seasoning of coupons change.
And then the cycle turns. Rates rise. Premiums become discounts. Originators cut staff and prepay speeds plummet. But this too changes, and longtime participants will recognize echoes of 1994 or 1999-2000 in today’s washout.
The brief video animation below tracks the evolution of the mortgage market since 2006, with an eye on distribution and seasoning of borrowers.