April 4, 2017
By Bob Judge
Editor, The CPR Report
SBA Hot Topic Tuesday — SBA 7(a) Prepays Fall Back Below 8%
In February, prepays fell by 25%, going below CPR 8% for the first time this year.
Double-digit decreases in both defaults (CDR) and voluntary prepayments (CRR) led to the decrease.
Specifically, defaults fell by 21% while voluntary prepayments moved down by 25% versus January results.
For the record, defaults have remained below CDR 2% for 42 months in a row.
Turning to the details, overall prepayments fell by 24.54% to 7.23% from 9.58%, previously. In comparing YOY prepayment speeds for 2017 versus 2016, this year is running 15% (8.40% vs. 7.32%) above last year after two months.
As for the largest sector of the market, 20+ years to maturity, prepayment speeds fell by 31% to 7.02% from 10.18% previously.