The Yield Book mortgage prepayment model has been accepted as the golden standard for projecting borrower payment behavior for decades. Within that framework, we have developed the ability to closely predict an expected mortgage rate for a borrower with given characteristics (FICO, LTV, DTI, and others) at each point in time. For each lender, we compute the difference of the actual loan rate from the expected loan rate over that lender’s loan production. This metric is commonly referred to as SATO – Spread at Origination. Read this paper for an overview of our methodology.