We’re more than halfway through January already, the MBA has lowered its 2025 projection to $2.1 trillion, and there is a sense of “wait and see” out there among lenders and vendors regarding rates, products, regulations… Maybe you should do something besides just making a few extra calls. STRATMOR’s current blog is “Leaders Don’t Wait for Markets” which may give you some tips. In 2023, 12 percent of Americans changed residences (leaving states like CA, FL, and NY), a statistic not lost on top LOs and real estate agents. Elon Musk has the luxury of being geographically mobile, putting headquarters of various companies in places like Texas, but others not so much. The statistical gap between “the haves and the have nots” is widening. Here are some statistics that are probably all too familiar with underwriters and loan originators. In 2022, almost half of American households had no savings in retirement accounts, according to the Survey of Consumer Finances (SCF). More than one in four Americans (28%) have savings below $1,000. 12 percent said they had no savings at all. Helping someone save is a good way to lay the groundwork for future business and referrals. (Today’s podcast can be found here and this week’s is sponsored by Calque. White-labeled buy-before-you-sell solutions powered by Calque help you increase purchase volume and increase realtor business by helping them differentiate with a better process. With coverage in the 48 contiguous states, what are you waiting for? Hear an interview with RAMS Vik Kasparian on supply and demand in the mortgage asset sales space, secondary market dynamics, and current production trends.)

Lender and Broker Services, Software, and Products

Tired of chasing down borrowers for payments? Right from Encompass®, Fee Chaser automates the process by sending out a secure payment request allowing borrowers to pay on their devices easily. Best part? Quick and easy to implement. Check it out and start collecting any upfront fees with Fee Chaser.

Brokers should know that “American Heritage Lending is excited to announce an innovative option for borrowers: finance your Realtor fees in the mortgage. Our innovative LTV Stacking Program now allows borrowers to finance Realtor fees into the mortgage, creating greater affordability and flexibility at closing. Through this program, homeowners can add their buyer agent fees, up to 3% of the loan amount, directly to their mortgage, eliminating the need for additional out-of-pocket expenses. Plus, may be able to stack additional costs, such as broker fees and discount points, onto the loan without impacting the pricing structure. This approach preserves the borrowers cash flow while still maximizing their buying power, this is a game-changer. American Heritage Lending, LLC offers a variety of programs to meet your non-QM needs. Let us help you originate more. Contact Jamie Gueltzow, EVP – Third Party Originations.”

Join ActiveComply’s webinar series: Compliance & Coffee with Melissa Grindel, where top industry experts break down the latest mortgage compliance trends over your favorite brew. Each session delivers valuable insights into regulatory updates, best practices, and strategies to navigate the complex mortgage landscape. Whether you're a compliance professional or industry enthusiast, our webinars offer the perfect blend of knowledge and practical advice, ensuring you stay ahead in this ever-evolving field. Don’t miss out: grab your coffee, connect with peers, and enhance your compliance expertise with us. Do you know what to expect from regulators in 2025? Join in on Wednesday, January 22nd, at 2pm ET to hear from industry expert Mitch Kider, Chairman and Managing Partner of Weiner Brodsky Kider, PC. To secure your spot, Register Now.

Lending operators and The Mortgage Collaborative members: Tired of skyrocketing verification costs? Discover how Genesee Regional Bank saves 80% on income and employment verifications with Truv in Encompass! Join Joe Leone, Group VP at Genesee Regional Bank, and Richard Grieser, VP of Marketing at Truv, on January 23, 2pm EST for a live demonstration showing how Truv’s innovative solution delivers significant savings without compromising data quality. Between 2017 and 2023, the leading provider increased prices by an astounding 141%. It’s no surprise lenders are searching for better, more affordable options. After speaking with several Truv customers at a recent The Mortgage Collaborative Conference, Joe decided to make a change. Don’t let rising costs hold you back… See how Truv can transform your verifications. Reserve your spot today!

“A recent Business Insider article shone a spotlight on AMC pricing, revealing its draining $12 billion dollars from homeowners… and counting. The investigation exposed AMC’s murky practices of charging sky-high fees, often surpassing the amount received by the actual appraiser. Influential figures, including Cindy Chance, ex-CEO of The Appraisal Institute, and Josh Tucker, co-founder of The Appraisal Regulation Compliance Council (ARCC), have voiced their concerns over this alarming issue. The ARCC has diligently amassed evidence of unconscionable fee discrepancies, unveiling instances when AMC’s levied charges matching or even exceeding the appraisers pay. With no federal regulation in effect to curb AMC’s exploitation of the system, the consumer and lenders are left unfairly exploited.

“At The Private Asset & Management Group, LLC (PAM), we’ve taken the AMC issue seriously and have engineered a unique solution that fosters a fair, transparent appraisal process working hard in favor of both homebuyers and appraisers. At PAM, we believe in fairness, hence we charge a clear, flat fee of $99.00 per residential order, no exceptions, and no hidden fees. This rate remains steady, regardless of the complexity of the appraisal task. Our superior, fully customizable software program is provided to each lender, along with daily support. We’ve spread our wings nationwide, operating in all 50 states, following all state and federal regulations. Escape the hidden fee trap. Get in touch with us at info@pamvalue.com to learn more about fair and transparent practices.”

Senate Banking Committee and the FHFA

What did Tim Scott say to Director Sandra Thompson, what some view as marching orders? “I write to express my concerns about several actions taken by the Federal Housing Finance Agency (FHFA or Agency) throughout your tenure as Director. Your actions raise questions about your commitment in ensuring FHFA remains focused on prudent supervision of Fannie Mae, Freddie Mac (together, the Enterprises), and the Federal Home Loan Bank (FHLB) System, which collectively support nearly $9 trillion in funding for mortgages to American families. Regrettably, under your leadership, it appears FHFA has prioritized partisan political agendas over sound regulation.

“FHFA’s actions risk undermining stability of the housing finance system and substantially deviate from the Agency’s responsibilities, appearing to be driven more by political considerations rather than by prudential regulatory objectives. Former Chairman Johnson stated the Committee must ‘exercise Congressional oversight to ensure that the agency is balancing its attention among the entities it regulates and the role as conservator of Fannie Mae and Freddie Mac.’ With the recent politicized attention FHFA has shown its regulated entities, we agree. I look forward to exercising our oversight responsibilities this Congress and working with FHFA to ensure the Enterprises are well-positioned to operate outside of conservatorship.”

Tech and Mortgage: Delivering and Developments

To drive tangible progress in the mortgage industry, we need to focus on improving core operations and delivering more cost-effective, efficient solutions, rather than getting distracted by external factors we cannot control, argue Jeremy Potter and Marvin Chang in a thought leadership article published for the Chrisman Commentary this week. Key steps include recognizing the importance of GSE AUS, integrating fintech solutions into lending processes, and delivering better customer experiences despite constraints.

The point of sale (PoS) has evolved from basic data collection to a hub for orchestration and analytics, that can lead the way in proactive engagement and for products like refinances. As digital solutions mature, consumer data verification and digital closing are becoming critical areas of focus, with innovations in income verification and closing processes paving the way for broader adoption. The future of the mortgage industry lies in integrating these advancements into a seamless, efficient experience that addresses both customer needs and industry challenges, moving beyond pilot programs to deliver real value across the sector.

In addition, in another Thought Leadership piece, Ruth Lee, CMB, explains, “Agentic AI isn't fresh out of the lab. AI agents (systems designed to perceive information and act toward specific goals) have been around for years. They've been answering questions, executing transactions, and even controlling your smart devices. But until now, they've been pretty darn limited, with rigid dynamics that often feel mechanical and uninspired. Think of a Roomba: its clear goal is to clean floors, but somehow always manages to get stuck draining its battery on a shag rug.

“It's a profound change in how we think about technology, moving away from rigid interfaces to fluid, goal-driven ecosystems where Agentic AI handles the complexity behind the scenes. As Nadella points out, the result isn't just more efficient systems; it's smarter, more intuitive businesses ready to respond to today's demands and tomorrow's opportunities.

“Buzzwords may come and go, but Agentic AI isn't a fleeting trend… It's the next evolution in how we think about technology and its role in mortgage banking. This isn't about replacing people or even systems; it's about rethinking how we connect the dots. With the power of APIs, Agentic AI bridges the gap between the legacy systems we rely on and the dynamic, goal-driven ecosystems we need to thrive.”

Capital Markets

Yesterday’s data gave markets plenty to digest. Retail Sales for December rose 0.4 percent, slightly below expectations, while jobless claims came in higher than anticipated at 217k, signaling some labor market softness. Despite this, the market was buoyed by comments from Fed Governor Waller, who suggested the possibility of up to four rate cuts this year, helping Treasuries rally and leading to a modestly positive market reaction. Retail sales showed a modest 3.9 percent increase year-over-year, but the inflation-adjusted numbers pointed to a slight decline in real spending over the past year.

In addition to retail data, the weekly jobless claims report showed an uptick in initial claims, though the overall labor market remains solid. The Philadelphia Fed Index surged unexpectedly higher in January, signaling stronger demand and a rebound in manufacturing activity. Meanwhile, import and export prices remained subdued, alleviating some inflation concerns, and the NAHB Housing Market Index edged up, suggesting slight optimism in the housing sector. Business inventories saw a modest 0.1 percent rise in November. These reports collectively suggest a mixed but relatively stable economic environment as inflation pressures ease and consumer demand remains resilient.

Mortgage rates rose for the fifth straight week in Freddie Mac’s Primary Mortgage Market Survey. For the week ending January 16, the 30-year and 15-year rates respectively rose 11 basis points (to 6.27 percent) and 13 basis points to 7.04 percent, the first time 30-year rates are over 7 percent since last May. From a year ago, rates are respectively higher by 44-basis points and 51-basis points. (More accurate and up-to-date rates available here: https://www.mortgagenewsdaily.com/mortgage-rates)

Residential construction for December led off today’s economic calendar ahead of the long weekend (there will be a commentary, but no podcast on Monday). Housing starts (1.499M versus 1.320M estimate) and building permits (-0.7% month on month versus +6.1% last month) when they were expected to be mixed at 1.35 million and 1.46 million, respectively, versus 1.29 million and 1.49 million previously. Later today brings Industrial production and capacity utilization for December and November TIC data, for those who care. We end the 5-day workweek with Agency MBS prices better than Thursday evening by .125-.250, the 2-year yielding 4.23, and the 10-year yielding 4.58 after closing yesterday at 4.61 percent.