Wednesday was far less eventful than the first two days of the week as far as mortgage rates were concerned. The average lender raised rates just a hair, but apart from yesterday, these are the lowest levels in a month and very close to the lowest levels in more than 3 years. Bond markets and mortgage lenders will be closed tomorrow for Thanksgiving. While Friday is technically open, 9 times out of 10, it may as well not be. In other words, the Friday after Thanksgiving rarely sees any meaningful movement in mortgage rates or the underlying bond market.  

The new phone books are here, the new phone books are here! Oh, wait a minute. The new conventional conforming loan limits are here! The new conventional conforming loan limits are here! True, lenders that are entirely focused on non-Agency products like non-QM (without many of the loan level price adjustments or gfees) may not care too much, but for most, Freddie Mac’s and Fannie Mae’s changes are followed closely. For 2026 we’re up from 2025’s $806,500 to $832,750. This beats the $819,000 by about $13k that many lenders and investors moved to in late September/early October. They can all rejigger their systems. (More conforming news below.) All this focus on conventional conforming programs reminds me that LO comp is still a huge issue, and the source of litigation; it shouldn’t be put on the backburner. I continue to hear promises that made to potential recruits that are in violation of LO comp rules. Who is going to research and penalize infractions? The CFPB? Lenders shouldn’t have to pay the same for a conventional conforming loan as a bond program, and most agree that change is needed: LO comp rules being ignored can hurt companies. (Today’s podcast can be found here and this week’s are sponsored by The Big Point of Sale, which delivers a fast, flexible, and low-cost mortgage POS that gets lenders up and running in hours (not months) while empowering loan officers and consumers to collaborate seamlessly from any device. Hear an interview with Panorama’s Hector Amendola on home sales trends, borrower sentiment, rate psychology, and how originators are winning business in the current environment.)

Bonds were just slightly weaker overnight but are losing more ground in early trading.  The culprit: both of this morning’s 8:30am ET economic releases.  Jobless Claims data is probably the bigger deal as it continues to show no signs of labor market distress (216k vs 225k f’cast). The other report, Durable Goods, is more stale (pre-shutdown), but was also clearly upbeat with the core cap-ex figure coming in at a robust 0.9% vs 0.2% f’cast. The resulting sell-off in bonds is minimal but not massive. 10yr yields are up only 2.5bps at 4.021 and MBS are down less than an eighth. 

The New York Stock Exchange disclosed the news on Monday of the sudden passing of its head of International Capital Markets.

Swalwell alleges Pulte obtained and used the lawmaker’s personal mortgage records in violation of US privacy laws and constitutional protections for political expression.

An expanded data set based on the third quarter annual price changes is what U.S. Federal Housing uses to calculate next year’s conforming loan limits.

The Federal Reserve, Office of the Comptroller of the Currency and Federal Deposit Insurance Corp. issued a final rule Tuesday that softens leverage demands for the biggest and most systemically risky banks and lowers the community bank leverage ratio to 8%.

The administration has previously said the finalists are Fed Governors Christopher Waller and Michelle Bowman, former Governor Kevin Warsh, National Economic Council Director Kevin Hassett and BlackRock Inc. executive Rick Rieder.

Best Closing Levels in Nearly a Month

Bonds improved only moderately on Tuesday in a move that’s just as easily chalked up to random holiday-week volatility as any of the day’s data/events.  If we’re determined to give credit to particulars, we can cite things like the 13.5k decline in weekly ADP payrolls, or the market’s favorable reaction to rumors that Kevin Hassett is the front-runner to be the next Fed Chair (Hasset is assumed to be extremely dovish). Most notably, bonds took no damage from another day of upward momentum in stock prices. Yields closed out with 10s right at 4.0%–the best end of day marks since the day before the October 29th Fed announcement (6th lowest close in more than a year).

Econ Data / Events

ADP Employment Change Weekly

-13.5K vs — f’cast, -2.5K prev

Core Producer Prices MM (Sep)

0.1% vs 0.2% f’cast, -0.1% prev

PPI YoY (Sep)

2.7% vs 2.7% f’cast, 2.6% prev

Producer Prices (Sep)

0.3% vs 0.3% f’cast, -0.1% prev

Retail Sales (Sep)

0.2% vs 0.4% f’cast, 0.6% prev

Retail Sales Control Group MoM (Sep)

-0.1% vs 0.3% f’cast, 0.7% prev

FHFA m/m home price change

0.0 

Consumer Confidence 

88.7 vs 93.4 f’cast, 94.6 prev

Pending Home Sales

76.3 vs 74.8 prev

Market Movement Recap

08:35 AM Lots of data but no reaction.  MBS up 2 ticks (.06) and 10yr down 0.7bps at 4.02

10:04 AM holding best levels after more data. MBS up 3 ticks (.09) and 10yr down 2.3bps at 4.005

12:22 PM Rates rallying on Hassett Fed Chair rumors. MBS up 6 ticks (.19) and 10yr down 3.5bps at 3.993

04:24 PM Heading out with MBS still up 6 ticks (.19) and 10yr down 2.6bps at 4.001

Mortgage rates moved nicely lower on Tuesday with the average lender very close to the 2025 lows seen in late October. These levels are effectively right in line with the lowest since late 2022. If today’s drop seems abrupt, that’s because it is. In fact, it’s a bigger drop than the underlying bond market justifies. There’s a reason for this and we covered it in detail back in September: Why Rates Seem to Drop More Quickly as They Approach Certain Thresholds. Rather than credit any of the recent underlying events, the improvement in rates/bonds has more to do with idiosyncratic trading conditions that are often seen on major holiday weeks. That said, some of today’s data and events contributed. These include another week reading in weekly employment numbers from ADP as well as a reaction to rumors that rate-friendly Kevin Hassett will be the next Fed Chair. [thirtyyearmortgagerates]