Today involves a flight from Cancun to the West Coast. Maybe the news flow will cease for me in the six hours in the air, but the news flow impacting lenders, and government agencies involved with residential lending, continues. For example, the VA sent out a note about terminating 585 non-mission-critical or duplicative contracts. “These contracts represent less than one percent of the roughly 90,000 contracts VA currently has in place… The value of the contract cancellations totals about $1.8 billon. After accounting for the money already spent on the contracts, the cancellations will enable VA to redirect about $900 million back toward health care, benefits, and services for VA beneficiaries.” Elsewhere, the US Treasury Department has announced it will not enforce the Corporate Transparency Act, which requires businesses to disclose their beneficial owners. This decision comes after opposition from the Trump administration and legal challenges, citing concerns about the burden on low-risk entities. The Treasury plans to narrow the act's scope to focus on foreign reporting companies. In compliance news, the image of Elon Musk with a chainsaw struck a nerve for attorney Brian Levy. In his latest Musings, Levy discusses what he sees happening at CFPB in light of current events and what may happen going forward. You can subscribe to get an email when Levy issues a new Musing for free! (Today’s podcast can be found here and sponsored by Floify. Floify is an easy-to-configure point-of-sale platform that allows each branch or loan officer to customize its look and feel to meet the needs of their lending team, homebuyers, and market. Hear an interview with BeSmartee’s Tim Nguyen on the impact of Trump’s second term on housing markets, the necessity of mobile mortgage solutions for lenders, and balancing automation and personal interaction in mortgage processes.)

Lender and Broker Products, Software, and Services

Floify is going ALL IN at ICE Experience #X25 in Las Vegas! Stop by booth #417 to see Dynamic Apps in action: the no-code feature that lets lenders customize loan applications based on loan type. Whether you’re adding non-QM, HELOCs, Construction loans, or more, Dynamic Apps helps you streamline workflows, improve borrower experience, and stay compliant. Need a break from the hustle? Join us in our onsite suite for refreshments, an exclusive gift bag, and of course great conversations with the Floify team. Whether you're placing big bets on growth or just exploring your options, we’re here to show you how Floify can help you stack the odds in your favor. Walk-ins welcome, but scheduling a meeting guarantees your spot. Don’t leave it to chance… Secure your 1:1 time with the Floify team today! Reserve your meeting now!

Get your HELOC now so you can use it when you need it! Does your client need a HELOC, like yesterday? Symmetry has Stand-Alone & Piggyback HELOC options available, and in certain situations they can close in approximately 7 days from start to finish. Reach out to your dedicated Area Manager for more info. Symmetry is ready to help with your next HELOC scenario. Service, Speed, & Simplicity.

Tracking down Letters of Explanation shouldn’t feel like an episode of CSI. LiteSpeed’s LOE Generator gives borrowers a simple, structured way to provide the details lenders need, so approvals don’t turn into a guessing game. Case closed. Book a demo with the LenderLogix team to see how it works.

Down Payment Resource is on fire these days, making the HW Tech100 list and CEO Rob Chrane named an RISMedia Newsmaker. Now it’s punching another hot ticket as ICE’s 2025 Innovation Technology Partner of the Year, just in time for ICE Experience, Mar. 10-12 in Las Vegas. DPR’s integration with the Encompass® LOS platform, available on the Encompass Partner Connect (EPC) integration platform via API, embeds operational support for DPA directly into core loan production systems, so lending staff can confidently offer and manufacture DPA programs and communicate selections downstream to underwriters. Not on the Encompass LOS platform? That’s cool. DPR’s software solutions can connect lenders of any temp to its national 2,400+ program database. Find DPR in kiosk 15 at #X25, at TMC’s Live Large. Think Big (Mar. 16-18 in Dallas) or grab a spot on DPR’s calendar now!

Last chance to sign up for tomorrow's Modern Mortgage Summit! Don't miss this opportunity to learn proven strategies from 12 of the industry's top producers who are succeeding in today's market, including Jeremy Forcier, Shayla Gifford, and Dan Keller. For just $100, gain insights to close more loans, increase your market share, and boost profitability in 2025. Register now at modernmortgagesummit.com!

How About That Weather?

When it comes to the climate, and any changes, people seem to fall into various camps. Some say there is no climate change and it’s a conspiracy, some say it’s changing but has nothing to do with man, some say it changing and are acting accordingly. Others are quite alarmed. Despite what happens at the Federal level in the United States, much of the new climate related research comes from universities and private sector shops, and this is what insurance companies, engineers, and mortgage investors use.

Questions come up, such as, “Do we have good data as to the severity of storms from hundreds or thousands of years ago?” “How do we establish a baseline for severity?” “Why is anyone worried about carbon dioxide (i.e. the natural by-product of all living things and that which is essential to the photosynthesis process which oxygenates our planet)?”

For thoughts I turned to Kingsley Greenland, CFA, Director of Mortgage Risk Analytics and Extreme Event Solutions, at Verisk. “We have about 100 years of good data for natural hazards. For some perils, the link between warmer temps and severity are obvious, such as sea surface temp fueling hurricanes or aridity and fuel for wildfires. Other perils might lack a physics based link to temperature yet still seem to behave differently over the observation period (eg. severe storms). For any of your readers, underwriters, or investors in MBS, this is a widely accepted source of among scientists in the space.

“To study ‘anthropogenically forced’ impacts, aka human induced climate change, yes, 100 years is fine. That period overlaps well enough with elevated CO2 concentration and observed temperature increases. Would I like to see every hazard against every year for all time? Sure, but the hurricane hazard frequency and severity across Pangea during the Jurassic Period doesn’t seem relevant to near present risk. Palaeoclimatological studies are cool—tree rings and ice cores for example—and have shown a historic relationship between climate and atmospheric CO2 concentration.” Thank you, Kingsley!

Meanwhile, investors or lenders react to recent disasters and catastrophes or put measures in place to guard themselves against financial loss.

PHH Mortgage posted a new Announcement - Disaster Alert Update: Kentucky DR-4860 - additional county declared and West Virginia DR-4861 - new disaster has been declared.

On 2/26/2025, with DR-4861, FEMA declared that federal disaster aid with individual assistance has been made to four West Virginia Counties; McDowell, Mercer, Mingo, and Wyoming.

View AmeriHome Mortgage 20250208-CL Disaster Announcement for inspection requirements.

On 2/24/2025, with DR-4860, FEMA declared federal disaster aid with individual assistance has been made available to ten Kentucky counties affected by severe storms, straight-line winds, flooding, landslides, and mudslides from 2/14/2025 and continuing. See AmeriHome 20250206-CL Disaster Announcement for inspection requirements.

On 2/25/2025, with Amendment No. 1 to DR-4860, FEMA declared federal disaster aid with individual assistance to Floyd county affected by severe storms, straight-line winds, flooding, landslides, and mudslides from 2/14/2025 and continuing. For more information, view AmeriHome 20250207-CL Disaster Announcement – Kentucky Flooding.

On 2/18/2025, with Amendment No. 3 to DR-4856, FEMA identified an Incident Period End Date of 1/31/2025, for the state of California. Although individual assistance has been granted to the county of Los Angeles, due to the extensive size of this county, AmeriHome will require disaster inspections for Los Angeles County Zip Codes listed in AmeriHome 20250205-CL Disaster Announcement. Note: these areas will not be included in the AmeriHome Disaster Database on SellerWeb.)

Capital Markets

Shortly after President Trump enacted new tariffs yesterday, Canada and China responded with retaliatory measures, escalating tensions with two of the United States' three largest trading partners. With tariffs now imposed on Canada and Mexico and additional hikes targeting China, markets have begun assessing the likely countermeasures. Despite earlier market pricing for potential tariffs, the extent of the bond rally has been notable, with some benchmarks dipping below levels seen at the start of Trump’s presidency. While inflation concerns remain, investors are increasingly viewing them as short-term risks within the broader threat of a global slowdown.

Domestically, the economic strain on businesses, earnings, and employment could mount quickly, potentially dampening demand. If weaker demand offsets initial price increases and job losses become a factor, bond markets could see renewed support as investors seek safer assets. And keep in mind that a possible government shutdown is on the horizon as Congress approaches the March 14 deadline to approve funding legislation. Although a shutdown might seem unlikely based on the GOP’s standing in Washington, shifting political dynamics have made such assumptions less certain.

Despite bond yields falling as of late, the yield curve has remained relatively stable, with the 2s/10s spread holding within a tight range of 20- to 25-basis points, though technical signals suggest a potential breakout. Meanwhile, 2-year yields have fallen below 4.0 percent, reflecting growing market confidence in the Fed’s potential for easing policy, even as uncertainty remains over the extent and timing of rate cuts. Current market pricing suggests between two and three 25-basis points rate cuts in 2025, aligning with the Fed’s prior guidance, though this could shift further if economic conditions deteriorate.

With U.S. economic resilience facing fresh challenges, lower yields may persist as markets weigh slowing demand against inflationary pressures from new tariffs. Investors remain watchful for potential downside risks, even if they are not currently the market’s primary concern.

Today’s economic calendar kicked off with mortgage applications increasing 20.4 percent from one week earlier, according to data from the Mortgage Bankers Association. We’ve also received ADP employment for February (77k, much lower than expected). Later today brings the final February S&P Global services PMI, January factory orders, a buyback from the Treasury in the 10- to 20-year sector for up to $2 billion, and the Beige Book will be released ahead of the March 18/19 FOMC meeting. We begin the day with Agency MBS prices roughly unchanged based on coupon and maturity, the 2-year at 3.93, and the 10-year yielding 4.23 after closing yesterday at 4.21 percent.