WTMS Blog Today = What’s up in Mortgage Today (AM) – 05/01/2026
Jerome Powell just blocked Trump from removing him as a sitting Fed governor, and the Fed’s most divided meeting in 34 years signals deeper discord over future rate cuts. Eight Fed governors voted to hold rates at 3.5%-3.75%, but four dissents came from different camps: one wanting immediate cuts while three opposed forward guidance suggesting cuts ahead. Powell’s decision to remain on the Board after his May 15 chairmanship ends marks an unprecedented stand for Fed independence that will reshape mortgage market expectations.
Homeowners insurance premiums jumped 64% from end of 2021 to end of 2025, climbing from $1,597 annually to $2,625 nationally, with Louisiana, Florida, and Texas now averaging above $3,900 per year. These escrow-related increases directly tighten borrower debt-to-income ratios and are quietly killing deals in high-exposure states like Florida and Arizona. For mortgage originators, this insurance shock has become a hidden pricing and approval barrier that rivals rate sensitivity in many markets.
UWM launched dual-credit scoring for conventional loans, automatically running both FICO and VantageScore 4.0 and letting brokers pick whichever helps the borrower’s pricing. The move follows FHFA’s green light for VantageScore on Fannie and Freddie loans, with FHA adoption coming this year from HUD. Originators can now help borrowers qualify under alternative scoring models when traditional FICO metrics create obstacles, expanding access at 80% LTV or below.
Castlelake and Redwood Trust partnered to acquire up to $8 billion in prime jumbo mortgages, with Redwood’s Sequoia platform sourcing loans while Castlelake provides institutional capital. Sequoia’s loan volume doubled over the past year as banks retreated from mortgage lending, signaling continued shift toward non-bank securitization platforms. This $8 billion channel reinforces the growing role of specialty players in distributing jumbo originations outside traditional bank channels.
Jobless claims fell to 189K versus a 215K forecast, suggesting labor tightness remains despite cooling data elsewhere, while core PCE inflation came in exactly as expected at 0.3% monthly and 3.2% annually. Q1 GDP grew only 2.0% versus 2.3% expectations and employment costs rose 0.9%, beating forecast by a pip and signaling wage pressure. These mixed signals—strong labor, moderating growth, stable inflation—left yields relatively flat despite oil market recovery providing brief support.
The 10-year Treasury yield rose 1.2 basis points to 4.383% early Friday as UMBS 5.5 and 6.0 coupons declined modestly while 5.0s held steady, and GNMA securities tracked similarly with slight losses across mid-higher coupons. Yesterday’s yield peaks coincided technically with March 24-26 levels, which could signal a bounce if yields stabilize under 4.37%, though geopolitical headlines remain the primary volatility driver. Mortgage traders should watch whether the Fed’s Powell decision and mixed economic data can support a meaningful bond rally or if war-related risk keeps the ceiling in place.
**Locking vs Floating**
Originators face a technical inflection point where recent yield highs meet historical support levels from late March. A technical bounce could emerge if 10-year yields hold under 4.37%, but geopolitical conflict remains the dominant volatility trigger rather than pure economic data. Strong jobless claims and moderating GDP growth provide some yield support, yet employment cost surprises and insurance cost shocks create counterpressure on borrower qualification capacity.
Lock vs. float decisions should weigh this geopolitical ceiling alongside the mixed labor-versus-growth picture.
**Today’s Events**
Continued Claims (Apr/18): 1,785K vs.
1,820K forecast, 1,821K prior
Jobless Claims (Apr/25): 189K vs. 215K forecast, 214K prior
Core PCE (m/m) (Mar): 0.3% vs. 0.3% forecast, 0.4% prior
Core PCE (y/y) (Mar): 3.2% vs.
3.2% forecast, 3% prior
PCE (y/y) (Mar): 3.5% vs. 3.5% forecast, 2.8% prior
PCE prices (m/m) (Mar): 0.7% vs. 0.7% forecast, 0.4% prior
Core PCE Prices QoQ (Q1): 4.3% vs.
4.1% forecast, 2.7% prior
Employment Costs (Q1): 0.9% vs. 0.8% forecast, 0.7% prior
GDP (Q1): 2.0% vs. 2.3% forecast, 0.5% prior
**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 30yr**
| Coupon | Price | Intra-Day Change |
|—|—|—|
| 5.0 | 98.75 | 0.01 |
| 5.5 | 100.62 | -0.04 |
| 6.0 | 102.15 | -0.04 |
**GNMA 30yr**
| Coupon | Price | Intra-Day Change |
|—|—|—|
| 5.0 | 99.34 | 0.01 |
| 5.5 | 100.81 | -0.02 |
| 6.0 | 101.99 | -0.06 |
**Treasuries**
| Term | Yield | Price | Intra-Day Yield Change |
|—|—|—|—|
| 2 yr | 3.867 | 100.015 | -0.002 |
| 3 yr | 3.888 | 98.912 | -0.002 |
| 5 yr | 3.998 | 99.448 | -0.005 |
| 7 yr | 4.18 | 100.424 | -0.007 |
| 10 yr | 4.364 | 98.082 | -0.007 |
| 30 yr | 4.961 | 96.723 | -0.005 |
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