With originator pipelines much more cleared than they were late last year, MBS analysts are expecting shorter lag times for refinancings and quicker reaction times to low-rate environments. Having the pipelines cleared means higher short-term speeds.

A UBS Warburg report stated that this month's prepayments make evident that mortgage bankers' backlogs have cleared. However, as processing shifts from the previous six- to eight-week lag to a more normal four- to six-week lag, "a couple week's worth of straggler loans' get swept up," said analysts. This, in effect, temporarily boosts prepayments.

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