The day began like many others over the past several weeks. Bonds hadn't moved much overnight, but were paying some attention to slightly higher oil prices. 10yr Treasury yields were still in the familiar September range between 4.93% and 5.01%, and there was limited economic data on tap that threatened to upset the apple cart. Now let's talk about tail risk. It refers to a distribution of potential outcomes for something that can be reasonably forecasted with a margin of error. A vast majority of the outcomes fall in the main body of the parabolic distribution, but occasionally, an outcome…
“I won the lottery for a million dollars yesterday, so I decided to donate a quarter of it to charity. I now have $999,999.75.” One can make jokes about charities, or about people and companies in residential lending, but giving (and charity) is serious, and helps us keep our focus on things that matter: people in need. For example, there’s Fairway Independent’s Fairway Cares and contribution to the American Warrior Initiative (AWI). UHM… Several years ago, Southwest General Health Center received a $1.25 million donation from The Cosgrove Family Foundation to support the hospital's Maternity…
Bonds lost ground overnight with rising oil prices correlating very well with the higher yields. The selling was minimal and yields remained range bound until roughly 945am ET. While there was slight additional pressure from another little pop in oil prices, the main bad actor was a surprisingly strong reading in S&P PMI data. This series typically goes unnoticed unless it wildly beats/misses forecasts. This morning's results were on the wild side with both services and manufacturing hitting the highest levels in years. Bonds reacted immediately with 10yr yields jumping from 5.0% to over…
Bonds Bounce Back After Mid-Day Stumble Bonds began the day in stronger territory following overnight reports of regarding a potential reopening of the Strait of Hormuz. Yields and oil prices moved steadily higher after that, ultimately rising into negative territory following Trump's UN speech. Subsequent newswires pushed back in the other direction. These involved claims of contact between the U.S. and the Iranian delegation on the sidelines of the UN general assembly as well as Trump comments regarding momentum toward a deal. None of the above was sweeping or definitive, but it was enough…
Mortgage rates didn't move much on Tuesday, but at least it was in the right direction. Perhaps more exciting is the fact that the average lender is now at the lowest levels in a week with top-tier 30yr fixed rates at 7.17% versus 7.19% yesterday. This matches September 14th's rates. Before that, you'd have to go back to January, 2025 to see anything higher. Motivation came from familiar sources as oil prices moved lower after overnight headlines regarding a potential reopening of the Strait of Hormuz. There was a bit of a pull-back intraday but oil and bond yields moved back down in…
Here at the ACUMA event in Las Vegas, credit unions are definitely on the march for market share in a decreasing residential volume environment, given their place in the consumer’s financial landscape (“food chain”). Some of the conversation is focused on “builder biz.” Builders have been using capital to temporarily buy down rates or offer 30-year rates permanently 1 percent below prevailing market rates… they don’t want to cut prices and de-value other properties in the same subdivision as recent sales. Along those lines, Lennar delivered a sobering report, not only about missing earning…
Bonds began the overnight session in weaker territory and were mostly sideways until roughly 4:30am. At that time, newswires hit regarding an Iranian official suggesting to 2 separate news agencies that Iran could reopen the Strait within 7 days. That was the only part of the news that the market focused on, even though there were conditions and, later, denials. Oil prices dropped instantly and bond yields followed. Why would bonds move on potentially "fake" news? Because it's likely not actually fake. While we can only speculate, it's exceedingly plausible that some Iranian official did…
Sideways and Slightly Stronger It was a rather uneventful day with bonds holding sideways in a relatively narrow range after a modest overnight improvement. Intraday correlation with oil prices was fairly poor in the 8-10am window, but generally well-behaved otherwise. Short-end rates (2yr and shorter) were slightly higher on the day, and experienced some earlier volatility surround Fed's Goolsbee's comments on inflation and the rate path. The biggest takeaway there was that the Fed is attempting to assess supply shock inflation versus demand-driven inflation with Goolsbee saying he's hearing…
It was a fairly uneventful day for mortgage rates to start the new week. The underlying bond market was slightly stronger. This suggests slightly lower interest rates. The average mortgage lender lowered top-tier 30yr fixed rates by 0.01% compared to Friday. Underlying motivation for the bond market can mostly be attributed to lower oil prices, which have been a common source of intraday inspiration for better or worse. With today's drop, the average lender remains right in line with the rates they offered before last week's Fed rate hike. [thirtyyearmortgagerates]
Broker and Lender Products, Software, and Services Ever gone to pick up a prescription only to be told it needs prior authorization? The request leaves the provider’s system and lands in the health insurer’s, but neither system updates the other, so you end up calling the insurance company yourself to find out whether the drug is covered. Home equity runs on the same handoffs. Valuation, title, and flood certification each sit in a separate file with no automatic sharing, so a processor logs into each one by hand just to learn where a loan stands. With U.S. homeowners holding a near-record…
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