**WTMS Blog Today = What’s up in Mortgage Today (AM) – 09/04/2026**

Strong August jobs data surprised to the upside with 162,000 nonfarm payrolls added, crushing expectations of just 56,000 new positions and shifting market sentiment toward an imminent rate hike by the Federal Reserve. Mortgage rates surged to 6.71 percent as bond investors fled the market on recession fears dissolving and inflation concerns intensifying. The 10-year Treasury yield climbed to 4.79 percent, pushing UMBS 5.5 coupons down 17 ticks to 98.79 as MBS investors faced margin pressure.

Unemployment held steady at 4.1 percent while labor force participation surprisingly improved, signaling a resilient job market that complicates the Fed’s inflation-fighting mission. For originators, today’s employment surprise erases yesterday’s brief hope for a supportive Fed pivot and locks in elevated rate environment for the foreseeable future. Pending home sales turned negative for the first time since November, dropping 0.2 percent year-over-year in August after an eight-month winning streak peaked in May at 4.8 percent growth.

Price reductions hit 20.4 percent of August listings, matching last year’s rate as housing affordability deteriorates across the market. New active listings jumped 3.6 percent year-over-year to 1.14 million, though inventory still trails pre-pandemic levels by 11.1 percent, constraining purchase volume. Median list prices fell for the tenth consecutive month to $424,500, reflecting weakening buyer demand under persistent rate pressure.

This slowdown signals originators that refinance opportunities remain muted while purchase business faces headwinds as borrowers retreat from the market. Rocket Mortgage expanded its lawsuit against UWM, alleging the wholesale lender violated nonsolicitation agreements covering nearly 182,000 mortgages sold to Mr. Cooper in 2024 through aggressive refinancing programs.

According to the amended complaint, these targeted loans prepaid at roughly 2.5 times the rate of comparable mortgage pools, with more than 15,500 loans refinanced by December 2025 and UWM handling over 48 percent of those refinances. Rocket claims the activity violated programs including Refi75, KEEP, and Refi Shield 100, and is seeking at least $100 million in damages. UWM has denied all allegations and called the lawsuit baseless.

This legal battle underscores servicing rights disputes and the competitive tension in loan origination channels. eXp Realty is winding down its Success Lending joint venture with Kind Lending, which originated only $270 million year to date compared with $526.5 million in all of 2025, and is now exploring a partnership with Newrez to scale its mortgage platform. Newrez originated $31.3 billion in the first half of 2026, more than four times Kind Lending’s $7.5 billion, positioning it as a far more robust partner for eXp’s nationwide agent network.

Success Lending currently operates 113 loan officers across 22 branches while Newrez manages about 15 mortgage joint ventures. The shift reflects eXp’s recognition that larger origination platforms offer better leverage for capturing purchase and refinance volume from its agent base. This consolidation trend continues reshaping how real estate platforms compete in mortgage origination.

Mortgage rates are now locking in near historically elevated levels as borrowers reassess lock versus float decisions against a hardening Fed rate path. August earnings growth met expectations at 0.3 percent month-over-month while participation rate improvements suggest more resilient labor supply than anticipated. With Fed Governor Waller’s recent dovish hints now erased by today’s strong payrolls, traders are repricing Fed funds futures toward a September hold or potential October hike as inflation data becomes the decisive factor.

Originators should prepare for sustained rate pressure and heightened volatility through next week’s inflation data releases. The shift from refinance opportunities to purchase lending under elevated rates requires rapid repricing and lock-strategy guidance.

**Locking vs Floating**

Today’s blowout jobs report erased yesterday’s glimmer of hope for Fed accommodation and shifted lock-float calculus decisively toward locking.

With the unemployment rate holding at 4.1 percent despite participation rate gains, the Fed’s focus on labor market stability means rate hikes remain on the table if inflation data disappoints next week. Borrowers facing 6.7 percent rates should consider locking immediately rather than floating, as further weakness in bonds could push rates toward 7 percent. The combination of sticky service-sector inflation and resilient employment suggests the Fed cannot ease aggressively, making rate locks protective for loan pipelines.

**Today’s Events**

Average earnings month-over-month (Aug): 0.3% vs 0.3% forecast, 0.1% prior

Non Farm Payrolls (Aug): 162,000 vs 56,000 forecast, -23,000 prior

Participation Rate (Aug): 61.6% vs 61.4% prior

Unemployment rate month-over-month (Aug): 4.1% vs 4.1% forecast, 4.1% 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 |