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A growing volume of MBS backed by "hybrid" adjustable rate mortgages has created a need for more information about the prepayment characteristics of these loans, according to Greenwich Capital Markets here.
A Greenwich Capital study of conforming hybrid loans suggests investors might be pleased by the prepayment characteristics.
Hybrid ARMs exhibit less prepayment volatility than standard one-year ARM loans, but the marketplace treats them as if they were just as prepayment sensitive, according to the securities firm, which is trying to build a market for MBS backed by Hybrid loans, according to MBS analyst Linda Lowell.
Greenwich Capital says that the steadier ...
Source: HighBeam Research, 'Hybrid ARMs' Are Less Rate Sensitive.(adjustable rate...