48-Hour Rule

AAA

DEFINITION of '48-Hour Rule '

A requirement that all pooled information regarding to-be-announced transactions on forward mortgage-backed securities (MBS) be communicated to the buyer from the seller before 3 p.m. EST 48 hours prior to the settlement date of the trade. The 48-hour rule is a requirement under the Securities Industry And Financial Markets Association (SIFMA), which is formerly known as the Public Securities Association (PSA) or Bond Market Association.




INVESTOPEDIA EXPLAINS '48-Hour Rule '

Assume that the agreed upon settlement date between the buyer and the seller is July 14. The 48-hour rule requires that on July 12 by 3 p.m. EST the seller will have informed the buyer of the exact details of the MBS pooled that will be delivered on July 14. Also known as 48-hour day.










RELATED TERMS
  1. Public Securities Association - ...

    The predecessor association to the Bond Market Association, which ...
  2. Mortgage-Backed Security (MBS)

    A type of asset-backed security that is secured by a mortgage ...
  3. To Be Announced - TBA

    A term used to describe a forward mortgage-backed securities ...
  4. Settlement Date

    1. The date by which an executed security trade must be settled. ...
  5. Securities Industry And Financial ...

    An association that represents firms of all sizes in all financial ...
  6. Forbearance

    A temporary postponement of mortgage payments.
Related Articles
  1. How Interest Rates Affect The Housing ...
    Economics

    How Interest Rates Affect The Housing ...

  2. Behind The Scenes Of Your Mortgage
    Insurance

    Behind The Scenes Of Your Mortgage

  3. Why Are Mortgage Rates Increasing?
    Personal Finance

    Why Are Mortgage Rates Increasing?

  4. The Risks Of Mortgage-Backed Securities
    Bonds & Fixed Income

    The Risks Of Mortgage-Backed Securities

Hot Definitions
  1. Halloween Strategy

    An investment technique in which an investor sells stocks before May 1 and refrains from reinvesting in the stock market ...
  2. Halloween Massacre

    Canada's decision to tax all income trusts domiciled in Canada. In October 2006, Canada's minister of finance, Jim Flaherty, ...
  3. Zombies

    Companies that continue to operate even though they are insolvent or near bankruptcy. Zombies often become casualties to ...
  4. Witching Hour

    The last hour of stock trading between 3pm (when the bond market closes) and 4pm EST. Witching hour is typically controlled ...
  5. October Effect

    The theory that stocks tend to decline during the month of October. The October effect is considered mainly to be a psychological ...
  6. Repurchase Agreement - Repo

    A form of short-term borrowing for dealers in government securities.
Trading Center