Prepayment-risk-modellling-on-MBS

Mortgage Prepayment and Risk: A Data-Driven Overview

This analysis delves into how various loan characteristics and geographic factors affect prepayment rates within the mortgage securities dataset. By leveraging Power BI, we explore key insights from loan attributes like Original UPB, LTV ratio, DTI ratio, and credit scores. Our findings reveal that prepayment behaviour is consistent across most regions, with Vermont showing slightly higher rates. The data shows a peak in prepayment activity in the early 2000s, a decline post-2004, and recent fluctuations. The geographic analysis identifies states with varying prepayment activity levels, and loan purpose influences prepayment behaviour. This report provides actionable insights for strategic decision-making and risk management.