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Mortgage Today (PM) - 03/25/26

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March 25, 2026

# WTMS Blog Today = What's up in Mortgage Today (PM) - 03/25/2026 Rate Volatility Reaches Breaking Point Mortgage rates aren't just climbing anymore — they're whipsawing at speeds that strain the entire origination pipeline. Over the past few weeks, rates have swung dramatically within hours, creating uncertainty that kills more deals than high rates alone ever could. Borrowers can handle expensive money, but they can't navigate when pricing becomes unpredictable from one day to the next. This volatility is forcing Fannie Mae and Freddie Mac to step up their MBS buying programs, placing larger bids to stabilize the market. Even with GSE intervention, the wild swings show no signs of stopping. 10-Year Treasury Provides Rare Relief Today brought unexpected calm to an otherwise chaotic March, with the 10-year Treasury dropping 4.2 basis points to 4.323% amid lighter volatility. UMBS 5.0s gained 17 basis points to 98.50, while GNMA 5.0s jumped 17 points to 98.80, marking the strongest single-day performance in weeks. Import prices surged to 1.3% versus forecasts of 0.5%, but markets paradoxically strengthened despite the inflationary data. The disconnect suggests traders are more focused on Iran war de-escalation headlines than domestic economic indicators. This represents a potential turning point after weeks of multi-month yield highs. Iran War De-escalation Drives Bond Strength Wednesday's bond market rally stemmed from conflicting but ultimately positive headlines about Iran war negotiations, even as Iran publicly refuted U.S. claims of progress. Markets are betting that U.S. intentions to wind down the conflict matter more than verified agreements with Iran. If the U.S. wants to de-escalate, that outcome becomes reality regardless of Iranian public statements. This geopolitical shift provided the rare calm that mortgage markets desperately needed after weeks of persistent volatility. The narrowest trading range of March offered mortgage originators their first predictable pricing session in recent memory. HUD Targets Washington's Race-Based Down Payment Program Federal housing regulators are investigating Washington state's Covenant Homeownership Program, which offers zero-interest down payment assistance exclusively to borrowers whose ancestors are Black, Hispanic, Native American, Pacific Islander, or of Indian descent. HUD Secretary Turner called the program an illegal use of racial preferences that violates equal protection rights, noting that European, Japanese, Arab, or Jewish ancestry doesn't qualify applicants. The timing is particularly notable as it comes days after 16 state attorneys general sued HUD for allegedly forcing states to weaken their own housing discrimination protections. This investigation signals a broader federal pushback against race-conscious housing programs launched in recent years. FICO Pricing Practices Face Senate Scrutiny Sen. Josh Hawley is pushing the FTC to investigate FICO's credit score pricing, arguing the company's wholesale per-score price jumped from $0.60 to $10 over five years with 88% operating margins. FICO's planned 2026 price increase could add roughly $500 million in industry costs that ultimately get passed to borrowers. First-time buyers face the biggest impact since they often require multiple credit checks before closing. Hawley's investigation comes as mortgage originators already struggle with compressed margins and rising compliance costs. This scrutiny could reshape how credit scoring costs flow through the origination process. Lender News and Market Adjustments Brokers First Funding expanded its Non-QM super jumbo program to $5 million loan limits, offering increased flexibility for high-net-worth borrowers in tight credit markets. A California borrower sued United Wholesale Mortgage over allegedly unauthorized credit report pulls during early refinance inquiries, highlighting growing FCRA compliance risks. New data shows Latino homebuyers in California continue receiving disproportionately smaller shares of bank mortgage lending relative to their population size. These developments reflect an industry adapting to regulatory pressure while trying to serve underrepresented borrowers in volatile rate environments. Locking vs Floating Today's reduced volatility and bond strength represent a promising development, but yields remain near multi-month highs from yesterday afternoon. The improvement isn't significant enough to warrant abandoning defensive locking strategies given the persistent uncertainty. Originators should maintain cautious approaches until volatility patterns show sustained improvement over multiple sessions. Today's Events Import Prices: 1.3% vs 0.5% forecast, 0.6% previous Bond Pricing UMBS 30 yr | Coupon | Price | Intra-Day Change | | 5.0 | 98.45 | 0.11 | | 5.5 | 100.29 | 0.1 | | 6.0 | 101.8 | 0.09 | GNMA 30 yr | Coupon | Price | Intra-Day Change | | 5.0 | 98.84 | 0.21 | | 5.5 | 100.37 | 0.13 | | 6.0 | 101.49 | 0.06 | Treasuries | Term | Yield | Price | Intra-Day Yield Change | | 2 yr | 3.89 | 99.256 | -0.011 | | 3 yr | 3.89 | 98.907 | -0.016 | | 5 yr | 3.975 | 98.991 | -0.023 | | 7 yr | 4.15 | 99.1 | -0.034 | | 10 yr | 4.331 | 97.335 | -0.035 | | 30 yr | 4.907 | 95.603 | -0.024 |

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Mortgage Today (AM) - 03/24/26

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March 24, 2026

WTMS Blog Today = What's up in Mortgage Today (AM) - 03/24/2026 Mortgage markets are proving the cynics right as the Iran ceasefire rebound has already died. UMBS 5.0 prices dropped to 98.03, down 36 basis points from yesterday's close. The 10-year Treasury yield jumped to 4.406%, completely erasing Monday morning's gains despite oil prices remaining lower. Labor costs came in much worse than expected at 4.4% versus the 3.5% forecast. This inflationary data is pushing investors toward the Federal Reserve potentially raising rates rather than cutting them. Futures markets now see nearly a 50% chance of a quarter-point rate hike by October. President Trump's signals about productive talks with Iran lost their market impact after Iran denied substantive discussions. The Wall Street Journal reports that Persian Gulf allies may join the U.S.-Israeli campaign against Tehran. Markets remain on "hyper alert" for the next geopolitical development. Construction spending disappointed at -0.2% versus the 0.1% forecast. This economic weakness contrasts sharply with the stubborn inflation readings from labor costs. The mixed signals are creating the choppy trading conditions we're seeing across bond markets today. Locking vs Floating Today's market action demonstrates extreme volatility tied to war developments and inflation concerns. Bonds showed proof of concept that Iran de-escalation can drive gains, but those moves reversed quickly. Analysts recommend remaining cautious and defensive until a clear trend of de-escalation emerges with sustained bond market response. Today's Events - Construction Spending: -0.2% vs 0.1% forecast - Labor Costs: 4.4% vs 3.5% forecast - ADP Employment Change: 4-week average increases to 10K - New Home Sales data expected Bond Pricing UMBS 30 yr | Coupon | Price | Intra-Day Change | GNMA 30 yr | Coupon | Price | Intra-Day Change | Treasuries | Term | Yield | Price | Intra-Day Yield Change | UMBS 30 yr | Coupon | Price | Intra-Day Change | | 5.0 | 98.03 | -0.36 | | 5.5 | 100 | -0.23 | | 6.0 | 101.68 | -0.08 | GNMA 30 yr | Coupon | Price | Intra-Day Change | | 5.0 | 98.53 | -0.28 | | 5.5 | 100.17 | -0.15 | | 6.0 | 101.45 | -0.08 | Treasuries | Term | Yield | Price | Intra-Day Yield Change | | 2 yr | 3.904 | 99.231 | 0.052 | | 5 yr | 4.027 | 98.755 | 0.056 | | 10 yr | 4.406 | 96.748 | 0.059 | | 30 yr | 4.966 | 94.717 | 0.045 | Subscribe free at WellThatMakesSense.com to get this in your inbox daily.

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Mortgage Today (AM) - 03/23/26

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March 23, 2026

--- WTMS Blog Today = What's up in Mortgage Today (AM) - 03/23/2026 Bond markets whipsawed overnight after President Trump announced a five-day pause on strikes against Iranian energy infrastructure, citing progress in talks to reopen the Strait of Hormuz. The 10-year Treasury yield had surged to 4.443% by 6:45am before plummeting to 4.308% within minutes of the 7:04am announcement, ultimately settling around 4.354%. UMBS 5.0 coupons rallied 24 basis points to 98.39, while GNMA 5.0s gained 15 basis points to 98.72. Oil prices collapsed on the news, though some confusion remains as certain sources report no direct talks occurred with Iran, only intermediary discussions. The dramatic reversal pulled mortgage pricing back from the brink after what had been a brutal overnight session. Repricing Risk and Rate Reality Mortgage rates remain stubbornly elevated around 6.875%, with borrowers now fortunate to find anything near 6.375% after lenders repeatedly raised pricing throughout last week. March has been essentially a one-way trade against bonds with only brief corrective moments, as geopolitical uncertainty and inflation fears dominate market sentiment. The morning's rally offers some relief, but the volatility underscores how quickly conditions can shift based on Middle East developments. Lenders may issue improvement reprices today if current levels hold, though caution remains warranted given the whipsaw nature of recent trading. Fed Rate Hike Odds Climbing Bond traders now assign roughly 50% probability to a Federal Reserve rate hike by October, a dramatic shift from earlier expectations of continued cuts. President Trump's decision to engage militarily in the Middle East has convinced markets that inflation pressures will intensify rather than subside, fundamentally altering the policy outlook. Surging inflation expectations have widened TIPS breakeven spreads, reflecting growing concern about persistent price pressures ahead. Even with this morning's geopolitical reprieve, the underlying trajectory suggests rates may stay elevated longer than many anticipated. Softer economic data showing cooling GDP growth and weakening consumer spending could eventually counterbalance these concerns if tensions genuinely de-escalate. Agency Buying Activity Provides Support Both Freddie Mac and Fannie Mae are reportedly placing large orders to buy MBS, providing crucial support to mortgage-backed securities markets during this turbulent period. This buying activity helps explain why MBS spreads haven't blown out even wider despite the recent rate volatility. The GSEs' presence in the market offers some stability for originators trying to price loans amid rapidly changing conditions. However, this institutional support can only do so much against broader macroeconomic headwinds and geopolitical shocks. Originators should view this as a helpful backstop rather than a cure-all for current market challenges. Housing Market Fundamentals Weakening Buyer demand has dropped to record lows as elevated rates continue to suppress affordability across most markets. Home prices are declining in the majority of metros, signaling a potential shift toward a more balanced housing market after years of seller dominance. Persistent affordability challenges combined with structurally low housing inventory continue to cap upside potential in residential lending volumes. The industry remains constrained by these fundamental headwinds regardless of short-term rate movements. Any sustained improvement in mortgage rates would be needed to meaningfully revive purchase activity from current depressed levels. Private Credit Stress Building Stress in private credit markets continues to quietly build, with both investors and the Federal Reserve flagging risks tied to lending to weaker borrowers. These concerns previously helped push rates lower and could do so again if geopolitical tensions genuinely ease in coming weeks. The Fed's increased scrutiny of non-bank lending suggests policymakers are monitoring financial stability risks beyond traditional banking channels. Cracks in the economy including slower GDP growth and cooling labor markets may become a bigger focus for policymakers ahead. This week's economic calendar remains relatively light with mostly second-tier data, allowing geopolitical developments and Fed speakers to drive market direction. Locking vs Floating The current environment strongly favors locking rather than floating. Bond markets have traded in a predominantly negative direction throughout March with only brief corrective bounces. While this morning's rally on Middle East news provides temporary relief, attempting to time additional improvements amounts to catching falling knives in a treacherous market. Wait for dust to definitively settle before taking major risks with floating strategies. The only reason to float involves predicting future geopolitical outcomes, which carries substantial downside risk. Today's Events Construction Spending for January at 10:00 AM (Forecast: 0.1%, Prior: 0.3%) Bond Pricing UMBS 30 yr | Coupon | Price | Intra-Day Change | | 5.0 | 98.39 | 0.24 | | 5.5 | 100.32 | 0.24 | | 6.0 | 101.88 | 0.21 | GNMA 30 yr | Coupon | Price | Intra-Day Change | | 5.0 | 98.72 | 0.15 | | 5.5 | 100.4 | 0.2 | | 6.0 | 101.65 | 0.15 | Treasuries | Term | Yield | Price | Intra-Day Yield Change | | 2 yr | 3.867 | 99.301 | -0.038 | | 3 yr | 3.883 | 98.926 | -0.037 | | 5 yr | 3.981 | 98.963 | -0.027 | | 7 yr | 4.171 | 98.971 | -0.027 | | 10 yr | 4.354 | 97.155 | -0.029 | | 30 yr | 4.915 | 95.479 | -0.027 | Market Data

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