Well That Makes Sense – WTMS Well That Makes Sense

“Damn, there is so much great knowledge out there. Did you know that “BOOKS” are full of smart?? No, I mean like life changing, I-wish-I-knew-that-years-ago type stuff.

I know that I was waaaayyy late to the game figuring it out. And I know that a lot of you are too busy to read as much as you ‘should’. And that is why you need me.

I still remember how it started for me. It started in June of 2008. After 11 years …..Click to continue

Mortgage Today (AM) - 07/15/26

{{catlist}}
July 15, 2026

**WTMS Blog Today = What's up in Mortgage Today (AM) - 07/15/2026** Producer prices fell 0.3% month-over-month in June, crushing expectations for flat readings and igniting a rally in bonds across the board. The June headline PPI decline was driven entirely by energy prices, which plunged 5.7% as gasoline cooled significantly post-Iran conflict escalation. Core PPI, the inflation metric that excludes food and energy volatility, posted just 0.2% monthly growth versus the 0.3% forecast, signaling genuine deceleration in underlying price pressures. Notably, revisions to prior months brought annual PPI down a full percentage point—from 6.0% previously reported to 5.5% today—offering markets a much softer inflation narrative. This data triggered Fed Funds Futures improvements and Treasury yields broadly lower, with the 10-year falling 1.4 basis points to 4.574% by mid-morning. UMBS and GNMA securities posted solid morning gains on the back of softer inflation signals and improved technical positioning. The 5.5 UMBS coupon jumped 13–15 basis points, landing near 99.88, while comparable GNMA 5.5 securities traded around 100.42, also up substantially. Lower coupons like 5.0 UMBS showed gains of 15 basis points to 97.64, with GNMA 5.0 up 10 basis points to 98.08. These moves suggest investors are rotating back into agency mortgage securities as refinancing expectations shift lower on the back of declining rate prospects. Higher coupons including 6.0 UMBS and GNMA 6.0 also posted gains, though at a more modest 9–18 basis points, reflecting typical convexity mechanics in a rallying bond market. The broader Treasury complex weakened late morning as geopolitical tensions and oil price resilience tempered the initial enthusiasm from soft inflation data. The 10-year Treasury yield had climbed back above 4.61% by noon, giving back much of the morning's 1.4 basis point decline, while the 2-year yield sat around 4.165%, down only 3.6 basis points from Tuesday's close. Shorter-dated yields benefited more from the PPI print than longer tenors, a pattern consistent with Fed rate-cut expectations concentrated in the nearer term. The 30-year yield fell just 0.7 basis points, underscoring investor concern about medium-term fiscal and geopolitical headwinds that could sustain inflation and limit the Fed's ability to cut rates aggressively. Mortgage application activity rolled over again, with the Mortgage Bankers Association reporting a 2.7% decline in weekly submissions as the 30-year fixed rate climbed to 6.65%—its highest level since August 2025. Purchase applications fell 7% seasonally adjusted, reflecting ongoing affordability strain on borrowers, though refinance activity ticked up 4% week-over-week on hopes for future rate declines. The combination of elevated mortgage rates and constrained housing affordability continues to weigh on origination volumes, signaling that yesterday's CPI surprise and today's PPI beat have not yet moved the needle enough to unlock pent-up demand. Lenders remain focused on top-of-funnel borrower acquisition as purchase-driven originations contract. Demographic shifts are reshaping the mortgage industry's long-term playbook, according to a Mortgage Bankers Association white paper that warns household formation will slow as populations age and birth rates remain below replacement levels. Rather than pursuing a business model built on endless home price appreciation and rising purchase volume, lenders must now pivot toward operational efficiency, market share consolidation, and engaging borrowers earlier in their homeownership lifecycles. Some regional markets will continue facing supply constraints while others experience inventory growth that outpaces demand, requiring tailored origination strategies. The Fed's balance sheet runoff continues at a measured pace, with Agency MBS holdings declining $17.7 billion in June—the fastest monthly decrease in a year—but prepayment risks remain low given elevated mortgage rates that discourage refinancing activity. Fed Chair Kevin Warsh testified before the Senate Banking Committee on Wednesday, reaffirming the central bank's commitment to price stability and maximum employment while offering few immediate policy surprises. The testimony underscored that future Fed decisions will be guided by inflation data and work from newly established policy task forces reviewing communication, balance sheet strategy, and analytical tools. Markets are pricing a lower probability of a rate hike later this month following Tuesday's CPI surprise, though September expectations remain elevated pending further inflation signals. Oil prices continue to pose upside risk to the disinflationary narrative, having risen for three straight days on renewed Middle East tensions, and any sustained surge above $85 a barrel could derail mortgage gains and force lenders to lock positions defensively. **Locking vs Floating** The PPI print was softer than expected, particularly the monthly decline of 0.3% and downward revisions to prior months, which supports near-term bond rallies and floating-rate positions. However, energy prices remain the wildcard—fuel surges tied to Iran tensions could quickly erase today's gains, making floating increasingly risky unless oil stabilizes below $80 a barrel. Borrowers locking in the 6.5% range are protecting against upside inflation surprises, while those floating are betting that the Fed's rate trajectory has genuinely shifted dovish, a wager that depends on sustained disinflation. **Today's Events** - 8:30 AM: Core PPI m/m (Jun) — Actual: 0.2% vs. Forecast: 0.3% vs. Prior: 0.1% - 8:30 AM: Core PPI y/y (Jun) — Actual: 4.7% vs. Forecast: 5.2% vs. Prior: 4.6% - 8:30 AM: PPI m/m (Jun) — Actual: -0.3% vs. Forecast: 0.0% vs. Prior: 1.1% - 8:30 AM: PPI y/y (Jun) — Actual: 5.5% vs. Forecast: 6.2% vs. Prior: 6.0% - 10:00 AM: Fed Chair Kevin Warsh Testimony to Senate Banking Committee **Bond Pricing** **UMBS 30 yr** | Coupon | Price | Intra-Day Change | | 5.0 | 97.64 | 0.15 | | 5.5 | 99.88 | 0.13 | | 6.0 | 101.76 | 0.09 | **GNMA 30 yr** | Coupon | Price | Intra-Day Change | | 5.0 | 98.08 | 0.1 | | 5.5 | 100.42 | 0.15 | | 6.0 | 102.3 | 0.18 | **Treasuries** | Term | Yield | Price | Intra-Day Yield Change | | 2 yr | 4.165 | 99.687 | -0.036 | | 3 yr | 4.213 | 99.754 | -0.034 | | 5 yr | 4.29 | 99.265 | -0.035 | | 7 yr | 4.424 | 98.965 | -0.028 | | 10 yr | 4.571 | 98.442 | -0.018 | | 30 yr | 5.095 | 98.543 | -0.007 |

WTMS Video Summary

▶ Watch Today's Mortgage Market Recap

Mortgage Today (AM) - 07/14/26

{{catlist}}
July 14, 2026

**WTMS Blog Today = What's up in Mortgage Today (AM) - 07/14/2026** June inflation data delivered a bombshell this morning, with the consumer price index falling 0.4% month-over-month—the first decline since 2020—and core CPI flat at 0.0% versus expectations for 0.2% growth. This sharply better-than-expected report instantly propelled bond markets higher, sending 10-year Treasury yields down over 7 basis points and UMBS securities up more than 3/8ths of a point by midday. The 30-year UMBS 5.5 coupon jumped to 99.73, up 0.33 from the previous close, while year-over-year readings improved to 3.5% headline and 2.6% core—both below forecasts. Supercore inflation, which excludes housing costs, posted its first negative reading in over a year at -0.2%, a crucial sign that underlying price pressures are cooling. Market participants immediately reassessed Federal Reserve rate-hike odds downward, recognizing that this inflation trajectory reduces pressure on the central bank to tighten further. GNMA 30-year securities mirrored the rally, with the 5.5 coupon trading at 100.27, up 0.28 from yesterday's close, as mortgage investors shifted capital into agency mortgage-backed securities. The broader Treasury curve responded with short-end yields declining more sharply than longer maturities, reflecting the market's recalibration of near-term Fed policy expectations. Two-year Treasury yields dropped 8.5 basis points to 4.19%, while the 10-year settled around 4.57% after opening at 4.61% yesterday. This steepening in the yield curve benefits mortgage originators by improving the spread between wholesale funding costs and retail mortgage pricing. The benign inflation print also temporarily overshadowed earlier geopolitical concerns about Middle East tensions and rising oil prices, allowing markets to focus on the underlying economic fundamentals. Mortgage originators should recognize that today's CPI relief opens a brief window for competitive rate locks before market sentiment shifts again. Floating borrowers who held through recent weakness now face a difficult decision: locking in near-term gains or gambling on further Fed rate cuts. The sharp intraday rally in MBS pricing suggests that higher-coupon pools offer better value than lower coupons currently, as investors pay down principal and refinancing convexity improves. Correspondents and wholesale lenders will likely tighten pricing by 50 to 75 basis points on conforming and jumbo products within hours, so originating teams should move quickly to capitalize on improved margins. This is not a time to hesitate; inflation surprises of this magnitude can reverse just as fast as they arrive. **Locking vs Floating** After months of asymmetric floating risk, today's inflation print handed floating borrowers a genuine relief rally. The market's rapid repricing lower suggests that further Fed rate hikes are off the table in the near term, removing one of the primary risks that had made floating loans dangerous. However, geopolitical tensions remain elevated, and oil prices continue to climb, meaning another supply shock could easily reverse today's gains. Lock-friendly borrowers should act decisively, as this window of favorable repricing will not remain open for long. Floating borrowers who stay in the market beyond this afternoon are essentially betting that inflation will remain under control despite ongoing Middle East disruptions and elevated oil prices above $80 per barrel. **Today's Events** m/m CORE CPI (Jun): 0.0% vs 0.2% forecast, 0.2% previous m/m Headline CPI (Jun): -0.4% vs -0.1% forecast, 0.5% previous y/y CORE CPI (Jun): 2.6% vs 2.8% forecast, 2.9% previous y/y Headline CPI (Jun): 3.5% vs 3.8% forecast, 4.2% previous **Bond Pricing** **UMBS 30 yr** | Coupon | Price | Intra-Day Change | | 5.0 | 97.48 | 0.39 | | 5.5 | 99.76 | 0.36 | | 6.0 | 101.67 | 0.24 | **GNMA 30 yr** | Coupon | Price | Intra-Day Change | | 5.0 | 98.06 | 0.42 | | 5.5 | 100.27 | 0.28 | | 6.0 | 102.27 | 0.26 | **Treasuries** | Term | Yield | Price | Intra-Day Yield Change | | 2 yr | 4.188 | 99.643 | -0.085 | | 10 yr | 4.574 | 98.414 | -0.041 | | 30 yr | 5.089 | 98.637 | -0.018 |

WTMS Video Summary

▶ Watch Today's Mortgage Market Recap

Mortgage Today (PM) - 07/13/26

{{catlist}}
July 13, 2026

**WTMS Blog Today = What's up in Mortgage Today (PM) - 07/13/2026** Markets took a sharp dive as geopolitical tensions and Federal Reserve commentary whipsawed bond investors into the red. MBS prices fell 3/8ths point by late afternoon while the 10-year Treasury yield climbed 5.6 basis points to 4.615%, marking the weakest levels of the day. Fed speaker Christopher Waller's comments and renewed fighting near the Strait of Hormuz both triggered sharp selling pressure throughout the session. For mortgage originators, this environment favors locking rates now rather than floating, given the clear downward momentum in securities pricing. A landmark academic study shows that UWM's 2021 "All-In" ultimatum—which forced brokers to choose between working exclusively with United Wholesale or Rocket Mortgage—created surprising spillovers beyond the targeted lenders. Research from University of Kentucky finance professor Spencer Stone found that competing wholesale lenders immediately cut rates by an average of 5 basis points, a discount that lasted throughout the four-month study period. On a $300,000 mortgage, that translates to over $500 in present-value savings for borrowers. The most intriguing finding: borrowers in markets with little direct overlap between UWM and Rocket still received rate cuts, suggesting lenders couldn't safely target discounts by geography without inviting disparate-impact scrutiny. The antitrust case against Optimal Blue suffered a major blow as defendants successfully eliminated 17 of 29 originally named companies through coordinated dismissal motions. The Mendez v. Optimal Blue lawsuit accused the nation's largest lenders and the dominant pricing engine provider of operating like a cartel to artificially inflate rates and fees. Defendants argued that Optimal Blue's analytics tools provide only backward-looking, anonymized data that even the Federal Reserve uses—not instructions on how to price loans. With only 9 lenders remaining as defendants and trial not scheduled before 2029, the case has lost significant momentum. Nonbank servicers dominated mortgage servicing rights transfers in the first quarter, accounting for 64.2% of all purchase activity as $137.8 billion in unpaid principal balance changed hands. Carrington Mortgage Services led buyers with $36.8 billion in acquisitions, while PennyMac emerged as the quarter's largest seller at $24.2 billion. Lower-coupon loans from the 2020 and 2021 vintages—particularly those carrying rates between 2.5% and 3.49%—were the most actively traded, reflecting originator appetite for refinanced portfolio seasoning. This MSR fluidity signals continued consolidation among nonbank servicers and a shift away from bank servicing dominance. The Ginnie Mae MBS portfolio reached $2.97 trillion as of June 30, with total issuance for the quarter hitting $53.9 billion. First American faces a new class-action lawsuit in California over its DataTree product, which aggregates homeowner and mortgage data for subscribers at various access levels. The FHFA also signaled plans to remove "reputational harm" as a basis for suspending firms and individuals doing business with the GSEs and Federal Home Loan Banks. These regulatory refinements continue reshaping the operational landscape for servicers and data providers across the industry. Subscribe for free daily mortgage market insights at WellThatMakesSense.com. **Locking vs Floating** Floating rates carries asymmetric risk today with no clear catalyst for improvement. The combination of weaker MBS pricing and rising Treasury yields created a decidedly unfriendly float environment unless you're willing to catch falling knives. Tamer inflation data or a peaceful shift in geopolitical tensions could eventually reverse course, but there's no reliable indicator that either outcome is more likely than not. Lock now to avoid additional downside exposure in this choppy market. **Bond Pricing** **UMBS 30 yr** | Coupon | Price | Intra-Day Change | | 5.0 | 97.09 | -0.46 | | 5.5 | 99.41 | -0.37 | | 6.0 | 101.43 | -0.26 | **GNMA 30 yr** | Coupon | Price | Intra-Day Change | | 5.0 | 97.64 | -0.51 | | 5.5 | 99.99 | -0.28 | | 6.0 | 102.01 | -0.12 | **Treasuries** | Term | Yield | Price | Intra-Day Yield Change | | 2yr | 4.273 | 99.482 | 0.063 | | 3yr | 4.318 | 99.463 | 0.074 | | 5yr | 4.377 | 98.879 | 0.072 | | 7yr | 4.495 | 98.545 | 0.071 | | 10yr | 4.616 | 98.09 | 0.056 | | 30yr | 5.107 | 98.362 | 0.049 | Market Data

RECENT ARTICLES

Send me some brain food

We will Put More Awesome Stuff
In Your Brain

RECENT ARTICLES

Mortgage Today (AM) – 07/15/26

Mortgage Today (AM) – 07/14/26

Mortgage Today (PM) – 07/13/26

Article Archive

Mortgage Today (AM) – 07/13/26

Mortgage Today (PM) – 07/11/26

Mortgage Today (AM) – 07/10/26

Mortgage Today (AM) – 07/08/26

Mortgage Today (PM) – 07/06/26

Mortgage Today (AM) – 07/07/26

Mortgage Today (AM) – 07/06/26

Mortgage Today (AM) – 07/01/26

Subscribe

We will Put More Awesome Stuff In Your Brain

RECENT ARTICLES

Article Archive

Subscribe

We will Put More Awesome Stuff
In Your Brain