I like to say that I am one good Lottery Scratcher away from ditching this daily Commentary gig and starting something new. All kidding aside, where should we start today? With the rumored FICO layoffs yesterday afternoon? Iowa, Michigan, and the Carolinas all having conferences now? Pennymac is now live with VantageScore 4.0 across all three production channels. If you want to learn about appraisal news, there’s a 7AM PT (you’re your read that right) Fannie webinar tomorrow morning: Fannie Mae's UAD 3.6 Policy Exception: What You Need to Know! Two Harbors and UWM are firing shots at each…
If rate movement were a car, it's been driving pretty recklessly recently, and definitely not keeping good pace with other motorists. But every now and then, we see a break in the craziness. The overnight trading session provided an example. The bond car set its adaptive cruise control to follow the car in front of it (oil prices, in today's case). That's left us just a bit stronger to start, but it's not an inspiring reversal so much as a coincidental mini-correction. 10yr yields unfortunately seem to be hitting resistance at 5.26%, but oil bounced at the same time, and we're not…
What Will it Take For Bonds to Recover? Another day, another sell-off without any satisfying explanations. To be fair, you could say bonds just traded the curve today with anything 3yrs or shorter rallying at the expense of the longer end of the curve. But for the mortgage market, <3yrs is too short-term to matter. Data and headlines did not line up well at all with the weakness, so take your pick from the general themes we've added to the daily lock/float considerations. At some point, yields will have moved high enough to motivate investors to buy bonds for investment purpose (as opposed…
The good news is that today's average top-tier 30yr fixed rate ended only 0.01% higher than last week's high (7.61 vs 7.60). If you are only interested in good news, have a great rest of your Monday and you're free to go. The rest of the news isn't terrible, but we we can't classify it as "good." Bonds lost ground today and, as has been the case on many recent occasions, there weren't any new, obvious scapegoats. On a vast majority of days when rates make a move, there's a decent enough case to be made for some underlying cause. These days however, it's increasingly common to have to…
Today brings us the MBA of the Carolinas conference, where demographics, technology, and “building a team” are on the agenda. Here at the Michigan Mortgage Lender’s Association conference in Ypsilanti, tech is certainly “on the serving platter” in the sessions, but so is how originators should best use what they have to their advantage, which includes knowledge. For example, here’s something simultaneously sobering and hopeful for lenders. Per the Census Bureau, in 2024, 58 percent of men and 56 percent of women ages 18 to 34 lived with their parents. About 2.6 million U.S. parents provided…
Another week begins with the frustrating reality of the bond market selling just because there's no reason to buy. To be fair, 2yr yields are unchanged, but longer-dated yields are several bps higher than Friday afternoon. All this despite oil prices being lower and econ data being in line with expectations. At this point, anyone offering rationale for the movement is forced to craft a narrative that fits that movement. In other words, if yields were plummeting, the average bond analyst wouldn't be harping on a laundry list of reasons that bonds are making the incorrect move.
Why Bonds Sold Off Despite Weaker Jobs Report First off, read the AM commentary if you haven't already. This recap doesn't add much to that (but the video adds a lot). Bottom line, NFP was weaker, but that was the worst of the news. The unrounded unemployment rate barely budged and it would have moved LOWER (under 4.00%) were it not for the uptick in labor force participation. Higher oil prices contributed a bit to intraday weakness as did a recovery in French credit spreads. At the end of the day, this wasn't the jobs report that sowed any seeds of doubt about cracks showing in the labor…
Mortgage demand shocked no one by declining last week as mortgage rates climbed to their highest level in nearly three years. The Mortgage Bankers Association (MBA) reported a 6% drop in total mortgage application volume for the week ending September 25. Both sides of the market moved lower, with the seasonally adjusted Purchase Index falling 4% and refinance applications dropping 9% . MBA said purchase and refinance activity both reached their slowest weekly pace since 2025 . Refinances always get hit hardest by rate spikes with the index now 56% lower than a year earlier. Government…
Home prices picked up a little more speed in July, as both FHFA and the S&P Cotality Case-Shiller Home Price Indices showed stronger annual appreciation than in their previous readings. The gains remain relatively modest by historical standards, and while nominal prices are still moving higher nationally, the picture looks considerably less impressive after accounting for inflation. The FHFA House Price Index rose 0.3% from June to July, bringing the annual increase to 2.6% . While the national market is still technically appreciating, there's more and more variation between different…
Mortgage rates rose 0.04% today to an index value of 7.57% for a top-tier 30yr fixed scenario for the average lender today. That uptick in and of itself isn't especially large, but it's a bit counterintuitive on a day where the hotly anticipated jobs report came in much weaker than expected. The jobs report has 2 key components: Nonfarm Payrolls (NFP) and the unemployment rate. For most of the time any rate watcher can remember, NFP matters way more. The market still reacts to it (which is why bonds initially improved this morning), but unemployment has arguably taken the lead in terms…
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