The Ohio Supreme Court nixed a consumer’s attempt to secure relief for over 1,000 borrowers, regarding fines the lender owed them over late paperwork.

In a letter to regulators, the consortium of organizations recommended regulatory changes affecting a range of rules from risk weights to warehouse financing.

Treasury Secretary Scott Bessent said in a public appearance in Dallas Friday that the administration will seek alternative means of enacting the White House’s tariff agenda after the Supreme Court struck down the tariffs as outside the bounds of the law.

Research from Andrew Davidson claims a significant number of mortgage borrowers would have a wide variance in credit score if less than three pulls are used.

The Trump Administration proposed banning a smaller investor size than expected from purchasing more single-family houses, according to the Wall Street Journal.

If there’s one housing market metric that paints a brighter picture than the rest, it’s New Home Sales data from the Census Bureau. At 745,000, it eased slightly from an upwardly-revised annual rate of 758,000 , but was higher then the pre-revision reading of 737k, and 3.8% above December 2024’s 718,000. Fairly chunky revisions are par for the course with this data. The chart below shows pre-revision numbers (thus the slight uptick with the current release). For-sale inventory fell to 472,000 , down 2.7% from November and 3.5% lower than a year ago. At the current sales pace, that represents a 7.6-month supply , slightly below November’s 7.7 months and down from 8.2 months in December 2024. While supply remains elevated compared to the tightest periods of the past cycle, it continues to trend lower as sales hold firm. Prices moved higher on a monthly basis but showed mixed signals year-over-year. The median sales price rose to $414,400 (+4.2% MoM; -2.0% YoY), while the average price edged up to $532,600 (+0.5% MoM; +4.7% YoY). The divergence suggests a continued tilt toward higher-end transactions lifting the average.
2025 Total Sales: 679,000 (down 1.1% from 2024’s 686,000)
Inventory (YoY): -3.5%
Months’ Supply (YoY): -7.3%
Prior Month Context: November sales were up 15.5% from October’s revised 656,000

Bonds dictate mortgage rates and bonds experienced a bit of volatility this morning in response to the Supreme Court ruling on tariffs. The initial impact was negative for rates with Treasury yields moving higher and the prices for mortgage-backed securities moving lower. But the reaction was well-contained and bonds ended up erasing most of it by the afternoon. In addition, bonds had improved steadily yesterday, but not so quickly that mortgage lenders updated yesterday’s rate offerings. As such, the average lender had a small cushion to work with today, and it was more than enough to offset this morning’s bond market volatility. All that to say that the average lender actually moved a hair  lower.   The final number is in line with the lowest levels of the week–also the 2nd lowest level of the past 3 years behind January 9th (and not far behind at that). 

Tariff Ruling Tried (And Failed) to Steal The Show

If you were told ahead of time that Friday morning would bring news that the Supreme Court struck down the IEEPA tariffs, you wouldn’t be crazy to think it would be the week’s biggest news and a big potential source of volatility for bonds. But reality wasn’t quite as dramatic. It’s true that the tariff ruling garnered the week’s highest volume as well as some elevated directional volatility, but in outright terms, it was less than 3bps in 10yr yields and about half of that was recovered as the day progressed. Reasons and implications are discussed in greater detail in today’s recap video. 

Econ Data / Events

Core PCE (m/m) (Dec)

0.4% vs 0.3% f’cast, 0.2% prev

Core PCE (y/y) (Dec)

3.0% vs 2.9% f’cast, 2.8% prev

Core PCE Prices QoQQ4

2.7% vs 2.6% f’cast, 2.9% prev

GDPQ4

1.4% vs 3% f’cast, 4.4% prev

GDP Final SalesQ4

1.2% vs — f’cast, 4.5% prev

PCE (y/y) (Dec)

2.9% vs 2.8% f’cast, 2.8% prev

PCE prices (m/m) (Dec)

0.4% vs 0.3% f’cast, 0.2% prev

PCE Prices (Q/Q)Q4

2.9% vs 2.8% f’cast, 2.8% prev

Market Movement Recap

08:49 AM Slightly stronger overnight and a tiny bit of push-back after data. MBS unchanged and 10yr down 1bp at 4.066

10:13 AM Weaker after SCOTUS ruling on tariffs. MBS down 2 ticks (.06) and 10yr up 2bps at 4.097

04:30 PM More than reasonably resilient in the PM hours. MBS now unchanged and 10yr up only 1bp at 4.085

Mail-related check fraud never seems to go away, and the FBI reminds us that blue gel pens certainly help in reducing check fraud. “Rob, are you hearing that the increase in the popularity of artificial intelligence has led to an increase in mortgage fraud?” Yes, I have. It can be insidious… it may not show up until months or years have passed. Investors are becoming more and more wary. AI proponents say, however, that AI can be very good at detecting fraud. So, you decide. Few mortgage court cases ever make it to a jury to decide anything, but the industry is watching a class action lawsuit that alleges Rocket Companies and its subsidiaries illegally steered homebuyers to its in-house mortgage and title services. (Today’s podcast can be found here and this week’s ‘casts are sponsored by Optimal Blue. The only end-to-end capital markets platform built to power performance, precision, and profitability. Modern. Proven. Optimal Blue. Hear an interview with MAXEX’s Tom Pearce on the partnership with Tradeweb to create a more centralized, transparent, and scalable institutional marketplace for U.S. residential mortgage loans.) Products, Services, and Software for Brokers and Lenders Truework is a comprehensive income and employment verification platform that fully replaces manual in-house waterfalls and provides mortgage lenders with a single automated solution to run their verification processes. With Truework, lenders see up to 50% cost savings on verifications while increasing speed, accuracy, and R&W relief. We also offer free pre-approvals to help you qualify borrowers faster… only pay when we complete a file. Trusted by 4 of the top 5 lenders in the U.S., Truework is built to deliver results. Learn more.

The National Association of Realtors’ Pending Home Sales Index (PHSI) slipped modestly in January, easily prolonging its stay in a narrow range near all-time lows. Pending home sales decreased 0.8% month over month and were down 0.4% compared with the same time last year. While affordability conditions have improved somewhat as mortgage rates trend closer to 6%, the improvement has failed to bolster contract activity. NAR Chief Economist Lawrence Yun noted that lower rates have expanded the pool of mortgage-eligible households, potentially adding hundreds of thousands of new buyers this year. However, he cautioned that without a meaningful increase in housing supply, additional demand could simply push prices higher and renew affordability pressure. The Midwest and West posted monthly gains, while the Northeast and South declined. On a yearly basis however, the picture changes, with the South and West slightly positive and the Northeast and Midwest down from a year ago—reinforcing the fact that sales activity remains uneven and regional. Regional Breakdown (Month-Over-Month)
Northeast: −5.7%
Midwest: +5.0%
South: −4.5%
West: +4.3%
Regional YoY Change
Northeast: −8.3%
Midwest: −3.3%
South: +4.0%
West: +0.3%