Here in San Diego at the MCT Exchange 2025, with nearly 500 registrants, the agenda’s keynote speaker and one of the panels was composed of Fannie and Freddie employees. Well, policy changes have caused representatives of F&F to cancel conference speaking engagements. MCT quickly adapted, but it is certainly a sign of the times with the Agencies. Say what you will about their pricing and product nuances, both have provided the foundation for the American housing system, the envy of the world, for decades. Let’s hope that doesn’t vanish or change dramatically. Meanwhile, yesterday the Federal Housing Administration, aka FHA, which has been in existence since 1934, published Mortgagee Letter (ML) 2025-09, and Title I Letter, (TIL) TIL-490, Revisions to Residency Requirements. “These letters align FHA’s residency requirements with President Trump’s recent Executive Orders that prioritize the use of federal resources to benefit U.S. citizens and ensures the integrity of government loan programs… the updated residency requirements eliminate, in its entirety, the ‘Non-permanent Residents’ category in both the Single Family Title I and Title II programs.” More below. (Today’s podcast can be found here and this week’s is sponsored by ICE. ICE offers an interconnected digital mortgage ecosystem to help clients improve productivity, reduce costs, and deliver a meaningful customer experience. Today’s has an interview with ICE’s Richard Lombardi on how data is transforming the homebuying experience, and what the future holds for businesses embracing mortgage data and analytics.)
Software, Programs, Services, and Products for Lenders
Traditional methods of obtaining property valuations for home equity loans and lines of credit (HELOCs) present challenges for lenders. However, for loans under $400K, Interagency Guidelines (IAG) advise that automated valuation models (AVMs) can be used as the primary valuation method, contingent on an already known property value. The right valuation technology can help streamline processes and reduce costs by providing more efficient, credible, and reliable options for obtaining property value. AVMs leveraged in tandem with mobile property valuation solutions can provide a more cost-effective, faster mortgage preapproval to borrowers, with the ability to help validate traditional appraisal results or address appraisal disputes. Read the article, The role technology plays to help reduce property valuation costs, by John Holbrook, Senior Manager of Product Management and ICE Valuation Analytics, to learn how high-performance AVMs combined with digital valuation solutions can help lenders better support their customers.
Omne trium perfectum: “Good things come in threes.” Did you know the latest CDC data reports 2,505 triplet births in a single year? We’re happy to join our 7,515 brothers and sisters by introducing our own power trio: MMI, MonitorBase, and Bonzo, now bundled into a comprehensive end-to-end mortgage solution at one simple price. These fully integrated platforms give you the power to identify the right partners and borrowers with real-time market and borrower insights, anticipate client needs with predictive alerts and retention tools, and engage instantly through a CRM with built-in compliant SMS, email, and voice communication. No more inefficiencies, wasted spending, or juggling multiple systems. Instead, you get a streamlined, intuitive solution that keeps you ahead of the competition. Technology should work for you, not against you. With MMI, MonitorBase, and Bonzo combined, you have everything you need to close more deals without the hassle. One bundle. One price. One smart move. Learn more here.
Video Marketing Is Taking Off… Is Your Compliance Team Falling Behind? Social media videos are engagement gold but can be a compliance nightmare. With compliance risks lurking in every frame, manual monitoring just isn’t scalable. That’s why lenders are turning to ActiveComply’s AI Video Assist, embedded into SocialShield. AI Video Assist will streamline video monitoring by transcribing, analyzing, and flagging risks instantly so your team stays ahead of violations without the heavy lift. “It’s a huge time saver. We no longer have to watch every video manually. The transcripts and analysis make it easy to spot risks and proactively address compliance concerns before they become bigger issues.”– Amanda Tucker, Chief Risk and Compliance Officer, Atlantic Bay Mortgage Group. From Instagram Reels to YouTube Videos, ensure compliance while expanding your reach. Schedule a demo today!
“Amid constant industry innovation talk, Optimal Blue stands out by solving lenders’ real-world challenges. We listen to our clients and build innovations that truly address their direct needs. Our commitment to flexibility, transparency, and purposeful innovation means you get timely, value-driven enhancements at no additional cost. As Optimal Blue CEO Joe Tyrrell recently highlighted in a LinkedIn post, "We will never automate a bad process. We want to solve problems, improve efficiency, and eliminate human mistakes, including human bias." With tools like Ask Obi and CompassEdge Ratesheet generator, OB uses AI technology to connect front-end with back-end pricing and surface actionable insights so you can maximize profitability on every loan transaction. Optimal Blue solutions are trusted, built on modern technology, proven scale, market expertise, and unrivaled accuracy. Visit the Optimal Blue YouTube channel to hear directly from our clients about how our innovations are making a difference.”
Some POS systems make borrowers feel like they're applying for a mortgage with a fax machine. Clunky interfaces, too many clicks, and confusing needs lists are the fastest way to lose a lead. That’s why modern lenders are switching to LiteSpeed, a sleek, mobile-first point of sale that borrowers actually finish. With real-time Encompass® by ICE Mortgage Technology™ sync, dynamic needs lists, and a borrower dashboard that makes sense, LiteSpeed keeps everything moving for both the borrower and your team. It's not just faster. It's smarter.
CFPB and Townstone: Settlement Could be “Vacated”
Yesterday the CFPB announced that, “The Acting Director of the Consumer Financial Protection Bureau (CFPB) Russ Vought is seeking to vacate the settlement the CFPB extracted from Townstone after a seven-year harassment saga.
“Using a ‘redlining screen’ based on an arbitrary number of mortgages, CFPB set out to destroy a small Midwest firm with about ten employees and a radio program called Townstone Financial. After a thorough review, the CFPB is seeking to make Townstone whole by returning the six-figure penalty they were forced to pay.
“’The CFPB abused its power, used radical ‘equity’ arguments to tag Townstone as racist with zero evidence, and spent years persecuting and extorting them, all to further the goal of mandating DEI in lending via their regulation by enforcement tactics. The more we uncover at CFPB, the more we see how this agency was weaponized against targeted Americans,’ said Acting Director Russ Vought.
“’This was a flagrant misuse of government resources to destroy a small business that did nothing wrong. For the crime of protected political speech, this firm was targeted and harassed for years by this rogue agency. We are righting this wrong and protecting the First Amendment,’ said Senior Advisor Dan Bishop.
Non-Agency Investors Don’t go to 3.5 Percent Down
Who knows what today or tomorrow will bring, but yesterday the Federal Housing Administration published Mortgagee Letter (ML) 2025-09, and Title I Letter, (TIL) TIL-490, Revisions to Residency Requirements. “These letters align FHA’s residency requirements with President Trump’s recent Executive Orders that prioritize the use of federal resources to benefit U.S. citizens and ensures the integrity of government loan programs… the updated residency requirements eliminate, in its entirety, the ‘Non-permanent Residents” category in both the Single Family Title I and Title II programs.”
“The provisions of the ML and TIL may be implemented immediately but must be implemented for FHA case numbers assigned on or after May 25, 2025. The provisions will also be incorporated into a future version of Single Family Housing Policy Handbook 4000.1.”
“Currently, non-permanent residents are subject to immigration laws that can affect their ability to remain legally in the country. This uncertainty poses a challenge for FHA as the ability to fulfill long-term financial obligations depends on stable residency and employment. Under 24 C.F.R. § 203.33, HUD requires Mortgagees to evaluate a Borrower's ability to sustain long-term financial commitments, and no statute or regulations address noncitizen eligibility for FHA-insured loans.
“In the past, FHA’s residency requirements have required Mortgagees to document the Borrower’s lawful residency status, demonstrating long-term financial stability and eligibility for federal programs. FHA does not retain citizenship or residency data from the loan application and, therefore, does not maintain information on the number of non-permanent residents who have received FHA-insured loans under past policies.”
Reaction was swift. For example, Verus Mortgage Capital sent out a note to lenders regarding non-permanent resident status. “Due to the evolving status of non-permanent resident aliens, Verus recommends due diligence in determining borrower eligibility. A recent change that we have been made aware of is for borrowers with Temporary Protected Status (TPS)… For Non-Permanent Resident Alien loans, Sellers must monitor the USCIS website to ensure Temporary Protected Status associated with the borrower’s country of origin is still in effect and has not been vacated. If the TPS status of the country of origin has been vacated or shortened, the borrower is ineligible.”
In other, wholesaler specific news, United Wholesale Mortgage, is extending its removal of Loan Level Pricing Adjustments (LLPAs) on FHA, VA, and USDA loans for borrowers with a FICO score of 600 and above. “Extended through May 31, 2025, this initiative will continue to make an impact on borrowers and give mortgage brokers a competitive edge. By improving pricing by up to 150bps, borrowers may increase their buying power, find it easier to purchase a property or lower their interest rate to secure their dream home.
Capital Markets
MCT Exchange, the annual conference for mortgage capital markets professionals, begins today in San Diego, California. MCT’s event brings together industry experts, clients, and strategic partners to drive meaningful conversations and insights into mortgage capital markets. Throughout the multi-day conference, participants will dive into comprehensive sessions led by industry leaders, offering cutting-edge insights into market trends, technological advancements, and strategic growth opportunities. The conference represents a unique opportunity for attendees to expand their network, deepen their understanding of industry dynamics, and discover strategies for increased profitability and growth. For those unable to attend, MCT invites interested professionals to subscribe to MCT’s newsletter to continue receiving new educational content from the learning center and staying informed about the latest industry insights.
Despite the FHA and conventional conforming loan program changes, in a welcome turn of events there isn’t much market movement for me to report on from yesterday. A government auction of 5-year Treasury notes saw weaker demand compared to Tuesday’s 2-year note auction, but this had little impact on the market. Meanwhile, President Trump said that he would impose a 25 percent tariff on cars that are imported into the U.S. The tariffs will go into effect on April 2 and will apply to finished cars and trucks that are shipped into the country, including American brands whose automobiles are assembled overseas, and could raise prices for consumers significantly. Nearly half of all vehicles sold domestically are imported.
Investors remain cautious about more tariff announcements, and so do consumers. If you recall, Tuesday’s Consumer Confidence reading fell to a 4-year low, while concerns of an economic slowdown and sticky inflation are showing no signs of abating. New orders for manufactured durable goods increased 0.9 percent month-over-month in February when the figure was expected to decline. Excluding transportation, durable goods orders rose 0.7 percent month-over-month, though there was a downturn in business spending.
Today’s economic calendar kicked off with the final look at Q4 GDP (+2.3 percent on an annual basis), weekly jobless claims (224k, as expected), and advanced indicators: the goods trade deficit, retail inventories, and wholesale inventories. Later today brings pending home sales for February, KC Fed manufacturing for March, Treasury activity that will be headlined by $44 billion 7-year notes, Freddie Mac’s Primary Mortgage Market Survey, and Fed remarks from Boston President Collins and Richmond President Barkin. After the GDP and the other numbers, Agency MBS prices are roughly unchanged from Wednesday evening, the 2-year is yielding 4.02, and the 10-year is yielding 4.38 after closing yesterday at 4.34 percent.
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