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HOME2023-01-22T13:43:33-07:00

“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.

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

Mortgage Today (AM) - 09/29/26 {{catlist}}
September 29, 2026 READ MORE **WTMS Blog Today = What's up in Mortgage Today (AM) - 09/29/2026** Oil prices are easing and Treasury yields are retreating slightly, giving mortgage professionals a moment of relief after a brutal week of selling pressure. The 10-year yield dropped to 5.213 percent this morning, down 2.2 basis points from yesterday's close of 5.237 percent, as Saudi Arabia resumed flows through a critical pipeline. UMBS securities are holding steady with modest gains, while the broader bond market awaits critical economic data later today. Energy-driven inflation remains the primary headwind, but weakening oil suggests markets may finally be catching a breather. This intraday relief could matter for lock-and-float decisions, but the bigger question is whether this bounce has legs or fizzles out by Friday's jobs report. UMBS 30-year coupons posted minimal overnight movement, with the 6.0 coupon at 98.24, up just 0.04 points from yesterday. The 5.5 coupon printed at 95.59, up 0.03, while the 6.5 coupon remained nearly flat at 100.68 with only a 0.02 point increase. GNMA securities performed slightly better, particularly in the 5.5 coupon, which gained 0.08 points to 95.89 compared to UMBS weakness. These modest gains reflect cautious positioning ahead of a data-heavy Tuesday that includes the FHFA Housing Price Index, Case-Shiller Home Prices, and Consumer Confidence at 10 a.m. The market is essentially holding its breath, waiting to see if economic momentum confirms the case for higher-for-longer rates or if cracks finally appear in consumer spending. The credit score battle intensified when Rocket Mortgage announced it will default to VantageScore 4.0 for all GSE-eligible loans starting in the fourth quarter of 2026. After testing 1.4 million credit reports over four months, Rocket found that VantageScore helped more clients qualify and saved borrowers an average of $1,600 at closing. However, this move raises serious operational questions for the broader industry: verification infrastructure must be ready before investor infrastructure can catch up, and smaller lenders dependent on correspondent aggregators may lack the direct GSE delivery capabilities of Rocket or UWM. The concern isn't just competition—it's equity across lender channels. Without widespread correspondent investor participation, VantageScore expansion could widen the competitive moat for large direct lenders rather than democratizing access as regulators intended. The Iran conflict remains a central driver of bond market movement, with geopolitical tensions keeping energy inflation at the forefront of Fed policy discussions. Investors increasingly view elevated oil and diesel prices as sustained inflation risks rather than temporary volatility, knowing that transportation costs will eventually filter into food and core goods. The Treasury selloff reflects a market convinced the U.S. economy remains resilient: 10-year break-even inflation sits at 2.35 percent, suggesting confidence in the Fed's inflation-fighting ability. Yet the paradox is sharp—stronger economic data means higher rates, while weaker data could trigger a sharp rally if markets begin pricing in demand destruction from elevated borrowing costs. For mortgage professionals, this catch-22 makes floating riskier but waiting potentially costlier. Employment transitions across the mortgage sector continue, with Informative Research announcing that Tim Cox has returned as executive vice president of business process automation. Cox brings over two decades of mortgage technology and operational strategy experience from previous roles at IR and most recently at Xactus, where he led AI enablement and operational scalability initiatives. Meanwhile, the HELOC market remains volatile and demand-sensitive: home equity nationwide sits at $34.9 trillion with HELOC balances up for 17 straight quarters, yet pipeline activity swings sharply with every rate move. Lenders responding to this volatility are shifting toward fully automated fulfillment where possible, expert-managed where necessary, and flexible capacity that adapts to rate environment changes. The trend signals that mortgage professionals who can operationalize rapid scaling will win regardless of whether rates spike or stabilize. A crowded Tuesday economic calendar will test market resolve as the day unfolds with FHFA Housing Price Index, Case-Shiller data, Consumer Confidence, August JOLTS, and remarks from Fed Governors Bowman, Barr, and Waller all hitting between 9 a.m. and afternoon sessions. This concentration of data and Fed speak creates genuine risk for intraday whipsaws, making tactical decisions harder than strategic ones. Month-end passive rebalancing flows will overlap with data reactions, potentially exaggerating moves in either direction. The November Presidential election year backdrop adds policy uncertainty to every economic release, particularly around inflation and employment data. Professional mortgage originators should expect volatility and avoid anchoring decisions to this morning's brief Treasury relief. **Locking vs Floating** Wait for confirmation of a genuine bond market rally before adjusting lock-and-float positioning. Market participants continue recommending caution until economic data or Fed guidance provides clearer directional conviction. A strong economic report would likely add to rate pressure, while weak employment data could unlock a substantial mortgage rate rally if combined with bond market recovery. The issue remains asymmetric: data could accelerate either direction, making early positioning bets risky. **Today's Events** FHFA Housing Price Index (July) S&P Case-Shiller Home Price Index (July) Conference Board Consumer Confidence (September) August JOLTS Job Openings Federal Reserve speakers: Governor Michelle Bowman, Governor Austan Barr, Governor Christopher Waller **Bond Pricing** **UMBS 30 yr** | Coupon | Price | Intra-Day Change | | 5.5 | 95.59 | 0.03 | | 6.0 | 98.24 | 0.04 | | 5.5 | 95.89 | 0.08 | **GNMA 30 yr** | Coupon | Price | Intra-Day Change | **Treasuries** | Term | Yield | Price | Intra-Day Yield Change | Market Data Mortgage Today (PM) - 09/28/26 {{catlist}}
September 28, 2026 READ MORE **WTMS Blog Today = What's up in Mortgage Today (PM) - 09/28/2026** Bond weakness accelerated Monday as Treasury yields jumped to 19-year highs on geopolitical tensions and persistent inflation concerns. The 10-year yield climbed 7.6 basis points to 5.24%, with the benchmark 30-year bond rising to 5.55%, the highest level since 2004. UMBS 6.0 prices dropped 0.64 points while GNMA securities tracked similarly, signaling broader weakness across mortgage-backed securities amid elevated oil prices and concerns about prolonged Middle East conflict. Major banks are rolling out incentives to compete for borrowers as mortgage activity slows and affordability stretches beyond reach. Chase launched a limited-time rate sale offering up to 25 basis points off through October 4, while Bank of America is offering grants up to $17,500 toward down payments and closing costs. Wells Fargo is rewarding existing customers with rate discounts based on account balances, and Navy Federal introduced a no-refi rate drop program for members with six on-time payments, signaling industry-wide concern about origination volume. The wholesale channel is contracting as Eleven Mortgage exits its correspondent and wholesale businesses in 60 days, leaving broker loans still in the pipeline. Benchmark Mortgage announced aggressive lock policy changes including a flat 100 basis point extension fee versus the former 2 basis point daily rate. This marks another casualty in a consolidating industry where wholesale platforms continue to wind down operations amid rising capital pressures and reduced profitability in the current rate environment. UWM is raising at least $400 million through a rights offering as the wholesale giant pushes ahead with broker growth and capital restructuring. Oaktree Capital and the Ishbia family are backstopping the 200 million-share offering, reinforcing investor commitment to the channel's expansion despite industry headwinds. The move signals confidence in wholesale mortgage banking but comes amid broader market uncertainty and competitive pressures from both retail and correspondent channels. Mortgage industry practices around producer compensation reveal the "Moneyball problem" of measuring the wrong metrics when evaluating LO value. Volume-based rankings obscure true profitability, as $100 million in production from one originator may generate vastly different economics than the same volume from another depending on required support, pricing concessions, and pull-through rates. Stratmor argues lenders should track contribution dollars at the loan, LO, and branch level to understand actual profitability rather than relying solely on production volume comparisons. NFM Lending confirmed unauthorized access to customer data after a ransomware group claimed it stole 2.5 terabytes of information including Social Security numbers and financial accounts around September 7. A proposed class action lawsuit was filed September 16 in Maryland federal court, alleging the company failed to notify affected customers in a timely manner. The breach illustrates escalating cybersecurity risks in the mortgage industry and the critical importance of rapid incident response and customer notification protocols. **Locking vs Floating** Investors should continue waiting for stronger bond market signals before adjusting lock-and-float strategies. While weak economic data could trigger rate recovery, stronger data will likely push yields higher, adding to recent upward momentum. Until bonds demonstrate genuine rally conviction independent of forced selling, cautious positioning remains prudent given the conflicting technical signals and macro uncertainty. **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 | **GNMA 30 yr** | Coupon | Price | Intra-Day Change | |---:|---:|---:| | 5.5 | 95.81 | -0.8 | | 6.0 | 98.37 | -0.64 | | 6.5 | 100.43 | -0.61 | **US Treasuries** | Term | Yield | Price | Intra-Day Yield Change | |---|---:|---:|---:| | 2 yr | 4.926 | 99.668 | 0.067 | | 3 yr | 5.012 | 98.247 | 0.073 | | 5 yr | 5.072 | 99.688 | 0.079 | | 7 yr | 5.151 | 99.121 | 0.076 | | 10 yr | 5.24 | 95.262 | 0.076 | | 30 yr | 5.549 | 93.833 | 0.06 | Stay current on mortgage markets and industry strategy—subscribe free at WellThatMakesSense.com. Market Data Mortgage Today (AM) - 09/28/26 {{catlist}}
September 28, 2026 READ MORE **WTMS Blog Today = What's up in Mortgage Today (AM) - 09/28/2026** MBS securities took a beating early Monday as Treasury yields surged to two-decade highs, with the 10-year climbing to 5.23% and the 30-year near 5.55%, extending what increasingly looks like a permanent shift higher. UMBS 30-year coupons ranged from 95.75 (5.5% coupon) down 0.55 points to 100.83 (6.5% coupon) down 0.41, while GNMA 30-year coupons showed relative resilience with smaller intraday declines across the board. The catalyst remains a combination of hawkish Fed communication, resilient economic data, persistent inflation expectations, and a lack of willing bond buyers, with the market assigning roughly a 70% probability to an October rate hike. The real question facing lenders is whether Friday's modest rally—driven more by valuation bargain-hunting than conviction—signals we're finally out of the woods or merely a correction before further selling. Extension and liquidity risks have exploded as wider basis spreads, weaker specified pools, and higher primary rates force originators to navigate blown-out rate sheets and elevated trading levels. Affordability is reaching a breaking point, with consumer sentiment at four-month lows and one-year inflation expectations jumping to 4.6%. Buydown mortgages have emerged as a critical tool, now representing roughly $45 billion or about 2% of the Ginnie Mae II single-family universe, particularly in FHA and VA lending where they account for two-thirds of issuance. The product temporarily reduces borrower rates for one to three years while absorbing costs through sellers, builders, or lenders, attracting stronger-credit borrowers with FICO scores averaging 20 points higher than comparable loans. The Federal Reserve faces an uncomfortable dilemma: how much economic weakness will it tolerate before changing course if inflation remains the priority? Historical precedent from 2022–2023 suggests the Fed may tolerate considerable stress in housing, equities, and rate-sensitive sectors while maintaining restrictive policy. However, competing arguments suggest current inflation stems less from excess domestic demand and more from temporary supply-side forces like tariffs, geopolitical shocks, and AI investment buildout, while wage growth slows and housing-price gains remain modest. If that's true, further rate hikes could damage the economy without addressing underlying inflation drivers, meaning the market will search for visible economic cracks that finally convince the Fed to pivot. This week's economic calendar includes core PCE inflation, consumer income and spending, JOLTS, ADP, and ISM manufacturing reports, with Friday's employment data potentially the most consequential. Payroll growth is expected to slow to roughly 95,000 jobs in September while unemployment holds near 4.1%, suggesting labor softening even as spending and income remain relatively strong. Energy inflation tied to the Iran conflict, particularly record diesel prices, threatens to intensify cost-of-living pressures across transportation and production sectors. Consumer confidence deterioration combined with rising inflation expectations creates a fragile backdrop for the housing market heading into what mortgage originators had hoped would be a more stable autumn season. Mortgage industry consolidation concerns continue to percolate, with technology playing an increasingly central role in how smaller lenders compete with larger platforms. Conferences scheduled for this week and next—including MBA's Compliance and Risk Management Conference, the Virginia Mortgage Banker's Association Annual Convention, and MBA Annual 2026—provide networking opportunities and insight into shifting competitive dynamics. Industry discussions focus heavily on AI governance, loan origination technology, and how lenders can streamline borrower experiences while maintaining compliance in an increasingly complex market. The emerging consensus suggests that companies struggling with the build-versus-buy decision for technology solutions need clarity on which tools drive strategic advantage versus which are table-stakes requirements. Loan officers and branch managers continue to evaluate where they can build their businesses most effectively, with family-owned mortgage companies emphasizing autonomy and direct leadership access as competitive differentiators. Margin management tools and pricing analytics have become essential for retail channel lenders attempting to balance competitive pricing with controlled loan exceptions, particularly as spreads have widened and production coupons have become less attractive. Lenders searching for buydown opportunities or early-life prepayment protection in MBS pools are finding interesting pockets as they seek to bridge the affordability gap created by elevated home prices and high mortgage rates. The next few weeks will test whether originators can execute effectively while managing rate volatility and protecting their profitability as economic headwinds build. **Locking vs Floating** Market technicians face a pivotal decision as a decent bond rally Friday raised questions about whether it represents genuine recovery or merely a correction before further selling. The MBS decline of 11 ticks and 10-year yield increase of 4.8 basis points suggest weakness persists despite token improvement, and experts recommend waiting for stronger, more conviction-driven rallies before adjusting lock-float positioning. The extreme level of rate-sheet deterioration creates high risk-reward dynamics in the days ahead, meaning disciplined originators should hold protective positions and monitor whether the market demonstrates sustained appetite to move higher without heavy-selling catalysts driving moves. **Today's Events** No economic data releases scheduled for September 28, 2026. Markets remain focused on forward guidance ahead of this week's economic reports and next week's employment data. **Bond Pricing** **UMBS 30 yr** | Coupon | Price | Intra-Day Change | | 5.5 | 95.75 | -0.55 | | 6.0 | 98.44 | -0.4 | | 5.5 | 96.28 | -0.32 | **GNMA 30 yr** | Coupon | Price | Intra-Day Change | **Treasuries** | Term | Yield | Price | Intra-Day Yield Change | | 2 yr | 4.922 | 99.676 | 0.062 | | 3 yr | 5.005 | 98.266 | 0.073 | | 5 yr | 5.066 | 99.713 | 0.075 | | 7 yr | 5.148 | 99.137 | 0.075 | | 10 yr | 5.234 | 95.309 | 0.073 | | 30 yr | 5.547 | 93.871 | 0.053 | Market Data LATEST ARTICLES

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