I recently went to my favorite local Mexican restaurant, and there was a sign in the window, “Sorry, we are closed due to short staff.” Someone had written below it, “Higher taller staff because I want a taco.” Economics and interest rates were certainly discussed in Denver this week at the MBA’s annual convention, as were the ramifications of the election. “Unfortunately, no one in Congress has uttered the word ‘deficit’ in 20 years.” “Regardless of the outcome of the presidential election, no one should forget the direction Congress takes, given its role in the budget process.” “Sure, mortgage rates are expected to gradually go down, but what if they don’t? Are lenders and vendors ready for that?” “The Fed has over 400 PhD economists. And even with that it can’t precisely predict the future.” (Today’s podcast can be found here, and this week’s is sponsored by Truv. Truv lets applicants verify income, employment, assets, insurance, and switch direct deposits. Unlock the power of open finance, with Truv. Hear an interview with DelphX’s Patrick Wood on the credit rating market ahead of the U.S. Election.)

Lender and Broker Software, Services, and Products

Introducing Curindices, Curinos' new suite of market indices designed to give you the most relevant insights into mortgage market trends. Updated weekly, Curindices delivers national application, lock, and home value data based on our proprietary, marketing leading, lender-sourced data. Curinos sources statistically significant data to produce these benchmark figures, setting the benchmark for smarter, data-driven decisions in mortgage lending. Follow this link to be added to our weekly distribution list and to learn more about how Curinos helps clients stay ahead of the competition in today’s highly competitive market.

Arc Home is introducing HomeEQ, a fully digital Home Equity Line of Credit (HELOC) solution, set to launch in just a few weeks. HomeEQ is designed to give borrowers efficient access to their home equity, with a seamless process from application to funding in as little as 5 days. Brokers benefit with 2% compensation on funded loans and access to the $33 trillion U.S. home equity market, presenting a new revenue stream from new and former clients. For more insights, check out our YouTube page, where quick videos outline how HomeEQ can support your clients and expand your offerings. Update your broker agreement or contact Shea Pallante to learn more. With HomeEQ, its equity made easy: Connect with us to get ready for launch!

Don’t let servicing nightmares haunt your portfolio! TENA Companies, Inc.’s dedicated Mortgage Servicing Quality Control team offers ongoing monitoring and analysis, ensuring your firm stays compliant. Also check out TENA’s new Servicing QC e-book, available for free on the TENA website. The e-book provides a comprehensive guide for mortgage servicers and contains an in-depth look at the servicing QC process. Time is running out to get started on your MERS Annual Review & Report! If your firm has 1,000+ active MINs, this must be performed by a qualified 3rd-party review firm and completed by December 31st. Our team of professional MERS-certified auditors has years of industry experience and extensive knowledge of all servicing guidelines and requirements. Get started today! Contact us at info@tenaco.com.

This Halloween don't just scare away the competition… Leave them 6 feet underground with NIK-Ai! Do you ever spend time trying to find a NON-QM program to fit your borrower’s unique situation? Searching through program guidelines is time you should use to get more loans into your pipeline. NIK-Ai’s software searches through hundreds of NON-QM programs for answers to your questions in a matter of seconds. Simply toggle between program types, investor, or specific guidelines and let NIK-Ai do all the heavy lifting. Responses are quick, come ranked by pertinence, and include links to source documents. Spend more time closing loans and less time searching for the right program with NIK-Ai. Book a demo from this ad and receive a free 30-day trial period.

Lenders got 25 million problems and CFPB’s the one! In just the previous six months, CFPB has imposed over $25 million in penalties for HMDA violations. They told us, “We expect lenders to meet their responsibilities, and these enforcement actions are proof that we will hold companies accountable when they don’t. We will continue to focus on this issue in supervisory examinations of mortgage companies, and we will take action where we do find non-compliance.” I feel bad for you, son! Proactive compliance beats reactive every time, and costs much less. If you’re not sure if your HMDA house is in order, let Firstline Compliance help make sure you’re prepared before the examiners come knocking. We know where to look and how to fix the problems. Filing season will be here before you know it, so contact Josh Weinberg to get your HMDA review scheduled. Hit me!

Government News: FHA, VA, USDA, and Ginnie

While Freddie and Fannie continue to earn billions and see hundreds of billions flow through their systems every quarter, there are certainly other products. Your company may not offer these products, but plenty of lenders do. Last week, the FHA share of total applications was 16.4 percent, the VA share of total applications was 14.6 percent, and the USDA share of total applications was 0.4 percent.

Ginnie Mae announced new disclosure for rural borrowers, view the Press Release for details.

Ginnie Mae Mortgage-Backed Securities Portfolio reached $2.64 Trillion in September, read the Press Release for more information.

FHA posted a temporary waiver applicable to FHA-insured Limited 203(k) mortgages closed on or before August 31, 2025. While this temporary policy waives the 15-day occupancy requirement for this PDMDA, the requirement that at least one borrower resides in the property within 60 days remains the same. For more information, view the published policy in the Single Family Housing Policy Handbook 4000.1 (Handbook 4000.1) II.A.1.b.iii (A) for Principal Residences.

The Federal Housing Administration (FHA) posted a draft Mortgagee Letter (ML) on FHA’s Office of Single Family Housing Drafting Table (Drafting Table) for industry feedback by November 25, 2024. This draft ML proposes to eliminate the eligibility requirement that FHA-approved mortgagees employ Direct Endorsement (DE) underwriters on a full-time basis and to allow part-time DE underwriter employment. Mortgagees would still be required to ensure that their DE underwriters are employees of a single mortgagee and underwriting functions are not contracted out. FHA recognizes that the financial landscape for smaller lending institutions and Community Development Financial Institutions (CDFIs) has evolved significantly over the past decade, presenting both opportunities and challenges in sustaining growth and meeting customer needs. Thes changes intend to provide mortgagees with increased flexibility to more effectively manage their staffing needs, reduce origination costs, and encourage greater participation in FHA programs.

The Federal Housing Administration (FHA) posted a draft Mortgagee Letter (ML), on the Office of Single Family Housing Drafting Table (Drafting Table) for stakeholder review and feedback. This draft ML proposes policies and procedures for mortgagees to request that HUD release its Secretary-held liens for all Title II Single Family forward mortgages following a nonjudicial foreclosure sale provided that the mortgagee complies with the requirements established in the ML. If finalized and implemented, this new draft guidance would replace the interim guidance published in ML 2024-17, Interim Procedures for Nonjudicial Foreclosures with Secretary-held Liens, and announced via FHA INFO 2024-60 on August 29, 2024.

Capital Markets

The relationship between mortgage loan pricing and conditions in the capital markets is a poorly understood phenomenon, even within the mortgage industry. So how do lenders generate loan offerings and mortgage loan prices? While it’s superficially useful to contemplate the impact of MBS and mortgage spreads on primary loan offerings, spread levels are not incorporated into loan pricing methodologies. Learn about The Links Between MBS Markets and Loan Prices in this whitepaper written by MCT to debunk myths about how mortgage pricing is created. This resource provides a comprehensive look at these common misconceptions and the process of generating loan offerings. Download the whitepaper for an in-depth understanding of the function of inputs that impact residential mortgage pricing.

Net market movements at the close of the trading day don’t always tell the full story...This was the case yesterday, when bonds closed the day only a little off of opening values, but with a lot of bumps and volatility throughout the day.

We received a strong ADP Employment Change report for October (233k when it was expected to be 105k), showing that even amid hurricane recovery, job growth was strong in October. It makes the 130k consensus estimates for payrolls in October that are set for release tomorrow look low. The advance reading of Q3 GDP showed a deceleration in the growth rate to 2.8 percent from an expected 3.0 percent, which was the Q2 reading. The growth was due primarily to strong consumer spending on both goods and services. A half-percentage point of the growth was due to government spending on national defense, much stronger than recent quarters.

The market then received a surprisingly strong Pending Home Sales report for September (7.4 percent, nearly triple what was expected) to post the strongest pace since March. Compared to one month ago, pending sales climbed in all four major U.S. regions, led by the West. Year-over-year, contract signings grew in the Northeast and West and were unchanged in the Midwest and South. That doesn’t necessarily mean that affordability has increased though. Existing home sales prices are up about 56 percent (to $420k) compared to just before QE4 kicked off in March 2020 while new home prices are up 25 percent (to $411k) over the same time period.

Ahead of payrolls tomorrow, today includes more key data and we’re already underway with core PCE price index increasing .3 percent just as expected, month-over-month, and 2.7 percent year-over-year as expected. Spending was +.5 percent, about as expected. We’ve also received job cuts from Challenger: U.S.-based employers announced 55,597 cuts in October, down 23.7% from the 72,821 cuts announced one month prior. (It is 51% higher than the 36,836 cuts announced in the same month in 2023.) Let’s not forget weekly jobless claims (216k, lower than expected; continuing claims down to 1.862 million).

Later today brings Chicago PMI for October, Treasury activity that will be highlighted by a buyback in 10- to 20-year coupons for up to $2 billion, and Freddie Mac’s Primary Mortgage Market Survey. We begin Halloween with Agency MBS prices roughly unchanged from Wednesday’s close, the 2-year at 4.16, and the 10-year yielding 4.28 after closing yesterday at 4.27 percent after the reminders that the labor market is healthy.

Employment

It is no surprise that the new home building market remains active, and builders are seeking strong mortgage partners to reach their projections in the coming year. So, what defines a strong mortgage lending partner? The ability to create and grow the value for both partners with a proven platform of success built on technology, systems, and a sales-centric culture. If you are a mortgage lending leader with a proven track record of leading sales teams with a builder partner, let’s talk. InterSearch Associates, a leader in recruitment of talent in the real estate finance industry, is recruiting for Production Market Leaders and Mortgage Loan Originators in multiple states. For a confidential conversation or discovery call reach out to Ivonne Dominguez.

“Join our Team as Senior Portfolio Manager at Figure! Take charge of managing a portfolio of $200M+ in real estate, unsecured, and non-traditional loans! This dynamic role is at the forefront of portfolio performance, overseeing servicer management, loss mitigation, and foreclosure. You will also conduct due diligence and collaborate with third-party vendors to ensure top-tier performance. You’ll be the point of contact for investor communications on high-priority loan issues, delivering performance presentations to key stakeholders, and offering insights on trends. If you would like to thrive in a fast-paced, growth-focused environment where your strategic decisions and leadership will shape the future of our portfolio’s success, apply here!

“We have a bank client looking to buy a mortgage brokerage company with a minimum of 5 loan officers. The preference is the South, but open to other areas of the US. The bank is a well capitalized $1 billion plus bank. Please contact Joe Garrett (510-469-8633).”

(As a reminder, anyone searching for employment can post their resume at no charge at www.lendernews.com, and potential employers can view all resumes for several months for only $75.)