Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : REITS - Buying 1 - 2 weeks before going ex-dividend -- Ignore unavailable to you. Want to Upgrade?

To: Oak Tree who wrote (2454)	6/19/2003 3:19:46 PM
From: Dennis	Respond to of 2561

if you check out nly website news....the ceo explains why refys will hurt....i think he explains the spreads are less so they make less.... they counter this by what they call a barbell approach.... www.annaly.com

To: Oak Tree who wrote (2454)	6/19/2003 3:23:41 PM
From: Richard Barron	Read Replies (2) \| Respond to of 2561

Oak Tree, Refinancing can hurt certain types of mortgage REITs. If money was lent out 3 years ago at 8% and the homeowner refinances at 5%, the lender will essentially lose 3% return on the investment compared to before the refinance. This hurts if the lenders cost of capital was at a fixed rate. It has little or no impact on equity REITs. Lower interest rates make it harder for apartments to rent as some renters end up buying homes instead. Lower interest rates help equity REITs with variable rate debt or with notes and mortgages than can be rolled over into lower schedules. Richard