The Office of the Comptroller of the Currency (OCC) reported on the performance of first-lien mortgages in the federal banking system during the first quarter of 2026. The OCC Mortgage Metrics Report, First Quarter 2026 showed that 97.7 percent of mortgages included in the report were current and performing at the end of the quarter, a slight increase from 97.6 percent in 2025. (Today’s podcast can be found here and this week’s ‘casts are sponsored by Experian. From lenders and landlords to employers and consumers, Experian helps connect the housing ecosystem with the data and insights needed to make faster, confident decisions. Lead a smarter housing journey with Experian. Today’s has an interview with First Lien Capital’s Bill Bymel on how insurance challenges, AI adoption in servicing, and key leading indicators are shaping the next potential cycle of market distress.) Broker and Lender Software, Products, and Services With 30-year rates range-bound in the mid-6 percent range, credit unions selling loans on a best-efforts basis are forfeiting 35-40 basis points of conventional execution on every commitment. That’s margin that could be returned directly to members as more competitive rates or reinvested into balance sheet strength. In MCT’s new guide, A Credit Union’s Guide to Moving to Mandatory Loan Sale Delivery, Chad Stone, Director of Northwest Regional Sales at MCT, walks through the operational prerequisites for moving to mandatory, how credit unions’ structural advantages, including no warehouse line expense, portfolio optionality as a backstop, and higher member pull-through, make the risk profile more manageable than most leadership teams assume, and what board and governance approval requires. The guide also covers how lean secondary teams can run a hedged mandatory pipeline without expanding the capital markets function. Join MCT’s newsletter to stay informed with the latest market commentary and mortgage capital markets education.

Mortgage application activity was essentially unchanged last week, as a modest increase in purchase demand offset a slight decline in refinancing. The Mortgage Bankers Association (MBA) reported a 0.04% increase in total application volume on a seasonally adjusted basis for the week ending June 26. Purchase activity provided the week’s modest support. The seasonally adjusted Purchase Index increased 1% from the previous week and remained 3% higher than the same week one year ago, extending a trend of stronger year-over-year demand. Refinance activity eased slightly, with the Refinance Index declining 1% from the prior week while remaining 9% above year-ago levels. “Mortgage rates eased slightly last week as oil prices declined. As a result, mortgage applications increased modestly, with an uptick in purchase activity offsetting a smaller decline in refinances,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “Purchase applications remain ahead of 2025’s pace and have exhibited year-over-year growth for almost three months, as prospective homebuyers are finding opportunities in markets with ample inventory and easing home-price growth.” The refinance share of mortgage activity edged down to 41.4% from 41.5%, while the ARM share declined to 7.6% , its lowest level since January. Government-backed application shares were mixed. FHA share decreased to 16.9% from 17.9%, while VA share increased to 12.9% from 12.3%. USDA share slipped to 0.4% from 0.5%.

The real estate and fintech company completed the purchase of 100% of Mortgage One Group, marking a major step in its push into AI financing.

This data release means another milestone for the use of updated credit score models than the current FICO Classic has been met by Fannie Mae and Freddie Mac.

The Department of Housing and Urban Development got 67 responses to its request for information regarding the FHA program’s Minimum Property Requirements.

The rise in completed modifications occurred as many other loan performance indicators plateaued, and may reflect the temporary impact of recent rule changes.

Mortgage applications rose 0.4% on a seasonally adjusted basis from one week prior for the period ending June 26, according to the MBA’s Market Composite Index.

In a real sense, today’s rate update is more of an addendum to yesterday’s rate update. Yesterday afternoon saw heavy, continued selling in the bond market amid a flood of trading associated with the end of the quarter. Because mortgage rates are directly based on the bond market, this resulted in multiple lenders raising rates late in the day (after yesterday’s update).  Today has been much calmer by comparison with bonds holding fairly close to yesterday’s latest levels after some early weakness. Even so, there was still some weakness for mortgage lenders to account for. From yesterday morning, the average lender is up 0.11% on a top tier 30yr fixed quote.   If we adjust yesterday afternoon to account for the late day reprices, today’s rates are, instead, 0.05% higher. Either way, we’re currently back in line with the highs from the beginning of last week, but still below the highs from early June or mid-May.

Bonds Find Some Solace in Warsh Despite a Bit More Selling

The past 2 days have been rough for the bond market–nothing catastrophic, but “brisk” in terms of unexpected selling pressure.  To be fair, buying/selling pressure is never truly expected (otherwise, why wait to trade it?), and higher volatility was definitely a risk surrounding quarter-end and the data calendar. Today could have been worse, but the market found some solace in this morning’s Warsh comments the ECB SINTRA conference. Warsh stuck to the “no forward guidance” script but managed to offer some in a roundabout way by saying inflation risks have come down and that he was open to different views on the Fed’s balance sheet size. While not true forward guidance, it was a net-dovish message that the market reacted to. Shorter-term debt did best, but 10yr yields are ending up about 2bps lower than they were before Warsh.

Econ Data / Events

ADP jobs (Jun)

98K vs 113K f’cast, 122K prev

ISM Manufacturing

53.3 vs 54.0 f’cast

Market Movement Recap

08:43 AM Selling continues this morning. MBS down an eighth and 10yr up 2.7bps at 4.49.

09:51 AM Off the weakest levels. MBS unchanged and 10yr nearly unchanged at 4.467

01:53 PM MBS up 2 ticks (.06) and 10yr down 0.2bps at 4.463

03:23 PM MBS down 2 ticks (.06) and 10yr up 1.3bps at 4.479

Bonds have added modestly to Tuesday’s big quarter-end sell-off (a phenomenon that has nothing to do with the sorts of fundamental developments that dictate a vast majority of market movement). Thankfully, the random plumbing-related volatility is behind us as we begin the new quarter. Old-school potential volatility awaits. The morning’s first order of business will be to see if Warsh says anything interesting at the SINTRA conference. After that, ISM Manufacturing data at 10am is a B+ market mover if it falls far enough from expectations.