WTMS Blog Today = What’s up in Mortgage Today (PM) – 10/20/2025

Bonds rallied at the 8:20am CME open with UMBS 5.0 up 9 basis points to 99.87. The 10-year Treasury yield dropped to 3.994%, continuing its flirtation with three-year lows. This morning’s strength occurred without any significant economic data releases as the government shutdown continues to delay key reports.

The federal government shutdown enters its third week, creating a backlog of delayed economic data that could impact both completeness and timing of future releases. The Conference Board’s leading indicator index was postponed despite being a non-government agency. Markets are pricing in 25 basis-point rate cuts following each of the two remaining FOMC meetings of 2025.

MBA Forecasts Strong 2026

The Mortgage Bankers Association announced total mortgage origination volume is expected to increase to $2.2 trillion in 2026 from $2.0 trillion in 2025. Purchase originations are forecast to increase 7.7% to $1.46 trillion while refinance originations are expected to increase 9.2% to $737 billion. By loan count, total mortgage origination volume is expected to increase 7.6% to 5.8 million loans in 2026.

Chief economist Mike Fratantoni said modest economic growth, Fed rate cuts, and improving housing supply will lift home sales next year. Regional differences will persist with markets like Florida and Arizona facing price drops while tight supply in the Northeast and Midwest keeps prices climbing. Borrowers are increasingly turning to adjustable-rate and FHA loans to manage affordability challenges.

Industry Developments

TransUnion followed its credit bureau peers in changing VantageScore 4.0 pricing for mortgage lenders, responding to Fair Isaac Corp.’s latest pricing moves. AGNC Investment Corp. announced the launch of new fixed income indices developed with Intercontinental Exchange to track current coupon Agency MBS performance.

The FHFA is seeking public feedback on its proposed Strategic Plan for FY 2026-2030 with input due by November 5, 2025.

Locking vs Floating

Risk-averse clients remain in lock mode as rates continue flirting with longer-term lows. Risk-tolerant clients continue to enjoy the absence of major corrections as they wait for more negative volatility to force their hand.

MBS prices help with intraday risk, but 10-year yield ceilings and floors track bigger picture bond market momentum.

Today’s Events

No economic data scheduled due to government shutdown

Bond Pricing

UMBS 30 yr
| Coupon | Price | Intra-Day Change |
| 5.0 | 99.87 | 0.09 |
| 5.5 | 101.22 | 0.07 |
| 6.0 | 102.33 | 0.01 |

GNMA 30 yr
| Coupon | Price | Intra-Day Change |
| 5.0 | 99.83 | 0.05 |
| 5.5 | 100.9 | 0.01 |
| 6.0 | 101.82 | -0.03 |

Treasuries
| Term | Yield | Price | Intra-Day Yield Change |
| 2 yr | 3.466 | 100.066 | 0.004 |
| 3 yr | 3.472 | 100.079 | 0.003 |
| 5 yr | 3.587 | 100.172 | -0.006 |
| 7 yr | 3.773 | 100.624 | -0.011 |
| 10 yr | 3.994 | 102.09 | -0.015 |
| 30 yr | 4.582 | 102.733 | -0.024 |