A big thrust by many lenders and originators is helping homeowners use the equity in their home or offering a shared equity product. And why not: there’s $36 trillion in home equity out there. And in an industry where we’ll be lucky to hit $2 trillion this year, it’s a juicy target. Jim Riccitelli, CEO of Unlock Technologies, sent me a recent study titled, “How Shared Equity Products Work, Who Is Using Them, and Regulatory Recommendations”. (Today’s podcast can be found here. This week’s ‘casts are sponsored by FirstClose, which provides fintech solutions to HELOC and mortgage lenders…
After Thursday's rather triumphant trading session in the bond market, today's moderate losses may be unpleasant or surprising to some. But they should be neither. Thursday was a bit exuberant in a good way, and Fridays often see position squaring. A bit of a pull-back is not only survivable but arguably more logical this morning, especially with oil prices being modestly higher. Bottom line: if MBS manage to hold this line without losing much more than a quarter point, and if 10yr yields end below 5%, compare today's closing levels to Tuesday's, consider that the Fed hiked this week and…
Even More Confirmation Throughout The Day It was heartening to see bonds erase yesterday's losses by the time domestic trading got underway today. Unmitigated victory would have required flat/higher oil prices. Instead, we were forced to wonder how much credit to give lower oil prices versus the expectation that longer-term rates would paradoxically appreciate a more hawkish Fed stance. This uncertainty increasingly vanished throughout the day. Oil prices steadily rose more than $3 between 8:30am and 1pm, but bonds were sideways to stronger the entire time. There's still some caution…
We love it when a plan comes together. Heading into yesterday's Fed announcement, the hope was that a rate hike would reassure investors in longer-term bonds (like those that underlie mortgage rates). We also didn't expect that benefit to necessarily play out on the day of the hike itself (it didn't). In fact, Fed day threw rates a bit of a curveball--not because the Fed hiked, but rather, due to the implications for additional hikes in Fed Chair Warsh's press conference. Thankfully, as of today, Warsh's unexpected hawkishness proved to be a temporary inconvenience for the market and…
“My wife says I only have 2 faults. I don't listen, and something else…” Communication matters. How many LOs wear a pin out in public that says, “Business is great!” so strangers will ask them what business they’re in? Probably not many, but maybe it is worth a try to start a conversation? (On today’s The Big Picture, Chris Whalen will be having a conversation about the current market.) Speaking of “getting the word out,” with business having slowed somewhat many companies ae looking at their technology, and Chrisman Demo Day is today at 1PM ET. It is a fine, cost-effective way (free) for…
Heading into yesterday's rate hike, recent evidence suggested the longer end of the bond market would appreciate a hike. There was no telling exactly how this would impact rates on Fed day itself--only that it was probably the lesser of two evils in the coming weeks. It was highly reassuring to see essentially no reaction to the rate hike in the first 30 minutes. But the press conference introduced additional selling pressure (obviously). Now this morning, bonds have gone a long way toward fulfilling the paradoxical prophecy. Even though a good amount of credit must be given to lower oil…
Mortgage rates are definitely higher today--the highest since January 13th, 2025. Today's Fed announcement had something to do with that. But while the Fed hiked the Fed Funds Rate, that had NOTHING to do with mortgage rates moving higher this afternoon. In fact, this is very easy see on a chart of bond market movement. We can use 10yr Treasuries as a more active proxy for the bonds that underlie mortgage rate movement. The Fed hike was not only almost 100% priced into financial markets, but it had no major impact on bonds when it was announced at 2pm. It wasn't until 2:30pm--when Fed Chair…
Huge Volatility After Fed, But The Coming Days Will Tell The Story Bonds ended the day only modestly worse off than yesterday afternoon. That's a pretty impressive accomplishment considering the Fed hiked rates and communicated at least one more rate hike in 2026. Nearly half the FOMC sees at least 2 more hikes in this cycle. Warsh's comments ratcheted up the hawkishness considerably. Intraday market movement told a completely different story compared to the modest day-over-day change. The rate hike itself had no impact. Case in point bonds didn't move from 2pm to 2:30pm ET. It was only after…
The Federal Open Market Committee approved the following statement for release by a 9 12 – 3 0 vote: The Committee decided to maintain raise the target range for the federal funds rate at 3-1/2 by 1/4 percentage point to 3-3/4 to 4 percent, in support of the Federal Reserve's dual mandate. The Committee is continuing its policy of maintaining ample reserves in the banking system. Economic activity is expanding at a solid pace despite pace. While uncertainty remains elevated uncertainty that owes, in owing, in part, to the conflict in the Middle East. geopolitical developments, domestic…
A while back I was watching the news on TV, and they were interviewing a couple whose home was threatened by a tornado, but who didn’t leave. “God will protect us,” they told the reporter as the wind picked up. Who did they think sent the tornado in the first place? Lenders and servicers know that “tornado alley” has shifted, and with it the geographic range of possible damage. It’ll be 98 degrees here in Dallas today, although Robbie and I are heading to Vancouver, WA, to visit Banner Bank for its Mortgage Banking Sales Conference. The fact is that this summer has been the hottest on record.…
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