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Mortgage Today (AM) - 04/03/26

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April 3, 2026

# WTMS Blog Today = What's up in Mortgage Today (AM) - 04/03/2026 Bonds are showing renewed strength this morning as oil price hopes fuel a recovery following earlier weakness, with the 10-year Treasury yield climbing 1.2 basis points to 4.317% as markets digest mixed employment signals. The combination of higher Challenger layoffs in March hitting 60,620 versus the previous 48,307 and lower-than-expected jobless claims at 202K suggests a labor market in transition. UMBS coupons are trading slightly weaker across the curve with 5.0% coupons at 98.81, down 10 basis points, while GNMA securities are showing similar softness. The market is positioning defensively ahead of Friday's crucial jobs report and the holiday-shortened Good Friday trading session. Employment data this morning painted a nuanced picture that's keeping bond traders cautious about making aggressive moves in either direction. Challenger layoffs surged to their highest level since last summer, indicating potential corporate belt-tightening ahead, while initial jobless claims dropped more than expected to 202K from 212K forecasted. Continued claims ticked slightly higher to 1,841K, barely above the 1,840K estimate but up from the prior 1,819K reading. These mixed signals are creating uncertainty about labor market direction just as the Federal Reserve weighs its next policy moves. Oil price futures for distant delivery months are expressing cautious optimism for Middle East de-escalation, providing some support for risk assets including mortgage-backed securities. However, the bond market's recent volatility has mortgage professionals maintaining defensive positioning strategies until clearer directional signals emerge. The 10-year yield's movement above 4.30% represents a key technical level that many market participants are watching closely. Geopolitical tensions continue to create an environment where sudden reversals remain possible. Mortgage originators are facing a challenging pricing environment as the gap between mortgage rates and underlying Treasury yields remains elevated due to credit spread concerns. The current UMBS 5.5% coupon at 100.63 reflects continued investor caution about mortgage credit quality despite strong home price appreciation in most markets. Production margins remain compressed as lenders compete for a smaller pool of qualified borrowers in the current rate environment. Secondary market liquidity has improved modestly but remains below historical norms, contributing to wider bid-ask spreads. The upcoming jobs report on Friday carries outsized importance for mortgage markets, with economists expecting continued moderation in hiring pace and wage growth. Any significant deviation from expectations could trigger volatile moves in both Treasury and mortgage-backed security markets during the abbreviated trading session. Market participants are particularly focused on labor force participation rates and average hourly earnings data for clues about inflationary pressures. The holiday weekend adds an element of position-squaring that could amplify moves in either direction. Looking ahead to next week, the combination of fresh economic data and ongoing geopolitical developments will likely keep volatility elevated across fixed-income markets. Mortgage professionals should prepare for continued rate volatility as markets digest the employment picture and assess Federal Reserve policy implications. The technical setup in both Treasury and mortgage markets suggests that a break above or below current trading ranges could lead to accelerated moves. Careful attention to intraday price action and news flow will be essential for optimal timing decisions. Locking vs Floating Current market conditions favor a defensive approach with most clients maintaining protective strategies until bond markets demonstrate more consistent strength. Additional volatility is expected into Friday's jobs report combined with the holiday-shortened trading session for Good Friday. While some risk-takers may sense opportunity in oil price hopes for de-escalation, the average client should wait for more convincing bond market improvement before abandoning defensive positioning. Today's Events - Challenger layoffs (March): 60.62K vs 48.307K previous - Continued Claims (March 21): 1,841K vs 1,840K forecast, 1,819K previous - Jobless Claims (March 28): 202K vs 212K forecast, 210K previous 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 | Intraday Change | | 5.0 | 98.81 | -0.1 | | 5.5 | 100.63 | -0.07 | | 6.0 | 102.04 | -0.07 | GNMA 30 yr | Coupon | Price | Intraday Change | | 5.0 | 99.19 | -0.08 | | 5.5 | 100.79 | -0.05 | | 6.0 | 101.77 | -0.06 | Treasuries | Term | Yield | Price | Intraday Yield Change | | 2 yr | 3.82 | 99.39 | 0.017 | | 3 yr | 3.843 | 99.036 | 0.014 | | 5 yr | 3.963 | 99.041 | 0.018 | | 7 yr | 4.141 | 99.149 | 0.014 | | 10 yr | 4.319 | 97.433 | 0.011 | | 30 yr | 4.893 | 95.803 | 0.015 | Subscribe free for daily mortgage market insights at WellThatMakesSense.com.

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Mortgage Today (AM) - 03/31/26

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March 31, 2026

WTMS Blog Today = What's up in Mortgage Today (AM) - 03/31/2026 Bonds are rallying despite surging oil prices as markets shift focus from inflation fears to growth concerns amid the ongoing Middle East conflict. Treasury yields dropped across the curve Monday with the 10-year falling to 4.33% from last week's eight-month high of 4.48%, while UMBS prices gained ground with most coupons showing solid improvements. The tug-of-war between stagflation risks has markets oscillating between worrying about higher prices from oil disruptions versus slower economic growth from geopolitical instability. Traders are now betting the Fed will hold rates steady in the 3.5% to 3.75% range this year with only a small chance of cuts by mid-2027. This marks a notable shift from earlier positioning when Iran's near-total blockade of the Strait of Hormuz first sent crude soaring nearly 50%. UMBS securities showed resilient performance with the 5.0 coupon gaining 24 basis points to 98.48, while the liquid 5.5s advanced 17 basis points to 100.37. GNMA bonds also participated in the rally with similar coupon performance, though gains were slightly more modest than their UMBS counterparts. The mortgage-backed securities market appears to be benefiting from the broader Treasury rally as duration risk concerns ease with falling yields. Current dollar prices suggest origination margins remain under pressure but are stabilizing from recent lows. The spread relationships between coupons continue to normalize as rate volatility moderates. European inflation data added another layer to the global monetary policy puzzle with eurozone CPI rising to 2.5% in March, faster than February's pace but below analyst expectations. This acceleration, driven primarily by energy costs from the Iran conflict, reinforces expectations for ECB rate hikes with markets pricing three quarter-point increases this year. The inflation surge represents the steepest jump since 2022 and highlights how geopolitical tensions are reshaping central bank calculus worldwide. German 10-year yields fell despite the hotter inflation print, mirroring U.S. Treasury performance as growth fears override price pressures. UK bonds followed suit with 10-year gilts dropping to 4.92% as the Bank of England faces similar stagflation trade-offs. President Trump's signals about potentially ending the U.S. military campaign against Iran provided some relief to energy markets, though the Strait of Hormuz remains largely closed. Wall Street Journal reports suggest Trump told aides the U.S. should achieve its main goals of weakening Iran's naval capabilities while pursuing diplomatic pressure to restore trade flows. Iranian drone strikes on Kuwaiti oil tankers off Dubai underscore continuing dangers despite talks of de-escalation. Brent crude wavered around $108 per barrel as traders weighed ceasefire prospects against ongoing supply disruptions. Trump's April 6 deadline for reopening the strait continues to loom over market sentiment. The mortgage origination landscape faces headwinds from elevated borrowing costs even as bonds show signs of stabilization. With the 10-year Treasury still 40+ basis points higher since the conflict began, purchase applications remain under pressure while refinance activity stays dormant. Loan officers report continued margin compression as competition intensifies for scarce volume, particularly in the jumbo market where rates have pushed many borrowers to the sidelines. The MBA Secondary & Capital Markets Conference in May will provide crucial insights into how lenders are adapting to this challenging environment. Industry participants are watching closely for any Fed pivot that might provide relief to mortgage demand. Today's Treasury performance suggests investors are beginning to price in economic slowdown risks over pure inflation concerns, but one day's move doesn't establish a trend. The bond market remains caught between competing forces of energy-driven price pressures and growth-dampening geopolitical uncertainty. Fed officials including Vice Chair Bowman and Governor Barr speak later today and may provide guidance on how policymakers view these crosscurrents. Economic data including the Chicago PMI and consumer confidence could offer early glimpses into March sentiment before Friday's crucial payroll report. For mortgage professionals, the key remains whether this nascent bond rally can sustain itself long enough to meaningfully improve funding costs and borrower demand. Locking vs Floating Despite yesterday's fairly significant bond rally, we remain just one day removed from the weakest closing levels in months, making it premature to conclude that rising rate pressure has run its course. MBS prices provide helpful guidance for intraday risk management, but monitoring 10-year Treasury yield ceilings and floors offers better insight into broader bond market momentum shifts. Until we see more than a day or two of sustained recovery, the prudent approach remains cautious given how quickly sentiment can reverse in this volatile environment. 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 | 98.48 | 0.24 | | 5.5 | 100.37 | 0.17 | | 6.0 | 101.93 | 0.14 | GNMA 30 yr | Coupon | Price | Intra-Day Change | | 5.0 | 98.9 | 0.17 | | 5.5 | 100.49 | 0.1 | | 6.0 | 101.72 | 0.11 | Treasuries | Term | Yield | Price | Intra-Day Yield Change | | 2 yr | 3.802 | 99.423 | -0.028 | | 3 yr | 3.821 | 99.1 | -0.034 | | 5 yr | 3.947 | 99.115 | -0.039 | | 7 yr | 4.132 | 99.205 | -0.035 | | 10 yr | 4.317 | 97.447 | -0.035 | | 30 yr | 4.892 | 95.827 | -0.023 | Subscribe free at WellThatMakesSense.com for daily market insights that help you navigate the mortgage landscape.

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Mortgage Today (PM) - 03/30/26

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March 30, 2026

# WTMS Blog Today = What's up in Mortgage Today (PM) - 03/30/2026 CrossCountry Mortgage snatched victory from United Wholesale Mortgage in the Two Harbors bidding war, agreeing to pay $10.80 per share in cash for a deal valued at roughly $1.13 billion. The wholesale giant called CCM's successful bid "ego-driven" and hinted at potential legal action, claiming their stock offer was superior and promising the "full context will be made public in due course." CCM will also cover the $25.4 million termination fee owed to UWM after Two Harbors walked away from their original merger agreement. The acquisition adds Two Harbors' capital markets platform and RoundPoint's servicing infrastructure, potentially making CCM the eighth-largest U.S. mortgage servicer by owned portfolio. The transaction is expected to close in the second half of 2026. Bond markets rallied sharply today as traders shifted from betting on Fed rate hikes to pricing in potential cuts, driven by growing concerns about the economic impact of the Iran war. Fed Chair Jerome Powell's comments that the central bank has little control over supply shocks like oil price surges helped ease fears about forced monetary tightening. The 10-year Treasury yield dropped 8.4 basis points to 4.35% while UMBS securities gained 11 ticks, though both retreated from their earlier highs. Traders are increasingly focused on potential growth risks from the Middle East conflict rather than just its inflationary impulse. The war has now entered its fifth week with oil prices hovering over $110 a barrel and little sign of resolution. NEXA Lending launched a new "servicing-aligned income" program that could give loan originators recurring compensation tied to loan performance, breaking from the traditional model where LOs watch others collect long-term servicing value. The brokerage is building what it calls a compliant framework for LOs to earn income beyond closing, tapping into retention, repeat business, and borrower relationship ownership. This development comes as the industry faces growing scrutiny over compensation amid shrinking margins and intensifying competitive pressures. The move signals a potential shift toward monetizing originator relationships at scale. If successful, NEXA's model could trigger broader competitive responses across the industry. Housing market imbalances reached record levels with sellers now outnumbering buyers by 46% nationally, creating a gap of 630,000 according to Redfin data going back to 2013. Affordability challenges are keeping buyers on the sidelines as mortgage rates climbed to their highest levels since October and application volume dropped 10.5% last week. Canceled contracts hit a record 13.7% of homes under contract in February, reflecting buyer hesitation. Sun Belt cities that overbuilt during the pandemic boom show the worst imbalances, with Miami leading at 163% more sellers than buyers. Nashville, Austin, West Palm Beach, and San Antonio round out the top five most imbalanced markets. Private credit funds face growing exposure to the software sector, with many putting up gates that restrict investor withdrawals due to illiquid underlying investments. Wall Street Journal research found these funds are massaging sector definitions to minimize perceived exposure to SaaS companies whose valuations have been crushed by AI disruption fears. The risk extends to the mortgage industry through non-QM lending, as some ultimate buyers of non-QM paper have software exposure. Credit problems typically spread, and non-QM's proximity means it would likely be impacted by software sector stress. Any impact on conventional lending would be minimal and could potentially be positive. Better Home & Finance appointed former Fannie Mae CEO Hugh Frater to its board of directors as the company positions for its next phase of AI-driven growth and capital markets expansion. Meanwhile, more than half of all active listings nationwide remained on the market for over two months in February, marking the highest percentage of "stale" listings since 2019 at 52.2%. LoanDepot expanded its partnership-driven origination strategy with a new joint venture alongside Texas homebuilder Betenbough Companies, targeting purchase borrowers in West Texas. A Florida appellate court ruled that creditors cannot force homeowners to draw from unused reverse mortgage credit lines to satisfy debts, establishing new legal clarity for HECM products. Locking vs Floating Despite today's fairly big bond rally, MBS Live cautions that we're still just one day away from the weakest closing levels in months. It will take more than a day or two of apparent recovery before concluding that rising rate pressure has run its course. MBS gained ground throughout the day but gave back some gains from morning highs, creating potential reprice risk for lenders who improved rates earlier. Those who repriced during the AM highs (11:15-1:15 ET) face the highest risk of negative reprices if volatility continues. Bond Pricing UMBS 30 yr | Coupon | Price | Intra-Day Change | | 5.0 | 98.24 | 0.37 | | 5.5 | 100.2 | 0.33 | | 6.0 | 101.78 | 0.21 | GNMA 30 yr | Coupon | Price | Intra-Day Change | | 5.0 | 98.73 | 0.29 | | 5.5 | 100.39 | 0.24 | | 6.0 | 101.61 | 0.2 | Treasuries | Term | Yield | Price | Intra-Day Yield Change | | 2 yr | 3.83 | 99.37 | -0.084 | | 3 yr | 3.854 | 99.005 | -0.085 | | 5 yr | 3.986 | 98.94 | -0.083 | | 7 yr | 4.167 | 98.996 | -0.088 | | 10 yr | 4.352 | 97.173 | -0.077 | | 30 yr | 4.915 | 95.479 | -0.05 |

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