Borrowers in the $1.4 billion Marcus portfolio could be mined for first-time home buyer leads, a BTIG report speculated.

It’s a toss-up between a recession or a soft landing, though some, including Fannie Mae’s Doug Duncan, still believe a downturn is more likely than not.

The lender agreed to pay $502,000 to put to rest allegations it violated the Garden State’s consumer protection laws.

The uptick in loans 30-to-60 days past due was offset by a continued, significant decline in mortgages 90 days or more past due which aren’t in foreclosure.

Boring, Placeholder of a Day

Now that the riveting headline has your attention, you may be dismayed to learn that it really was only a boring, placeholder of a day.  Bonds started fairly flat, made some gains at the 8:20am CME open, and then remained fairly flat for the rest of the day.  10yr yields drifted inconsequentially higher whereas MBS might be better described as truly sideways.  Attention has clearly turned toward next week’s Fed rate hike and press conference.  If anything, it’s somewhat reassuring to see bonds forego the urge to capitulate on a summertime Friday following yesterday’s range breakout, but there’s no sense in counting chickens until next Wednesday afternoon at the very earliest.

Market Movement Recap

09:10 AM Relatively flat overnight. Stronger after 8:20am CME open.  10yr down 4bps at 3.82 and MBS up 6 ticks (.19).

12:14 PM Sideways to slightly weaker so far.  5.5 coupons now up only 3 ticks (0.09). 10yr yields down 2.7bps at 3.831.

04:01 PM No change from previous update in MBS.  10yr yields are another 1bp higher at 3.841.  

After rising somewhat sharply yesterday, mortgage rates managed to find their footing on Friday’s market session.  Bonds typically face more volatility risk when they have to digest scheduled economic data or major news headlines.  Today offered a light supply of both (especially econ data… there was none). As such, trading levels didn’t drift far from Thursday afternoon’s and the average mortgage lender was able to lower costs by just a hair.  The average borrower would still be seeing the same interest rate that was quoted yesterday, but possibly with microscopically lower upfront costs.  Note: rates were close enough to unchanged that those upfront costs could be slightly higher in some cases. Bigger volatility is a bigger risk next week surrounding the Fed’s rate hike and the press conference with Fed Chair Powell. The rate hike is seen as a 100% certainty, so it’s the press conference that will capture the attention of the bond market (and thus, “rates”). 

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It’s a summertime Friday in the bond market, so anything can happen.  Bonds could undertake a huge rally or sell-off without any clear connection to anything in the news or calendar.  That said, these are just the sorts of eventualities that we’re less surprised to see on a data-free summertime Friday.  We don’t go into the day with an elevated expectation for one outcome or another.  More importantly, any outcome would be hard-pressed to change the broader narrative which is that of a generally range-bound bond market that seeks clarity from Fed Chair Powell in next week’s post-rate-hike press conference.
Meanwhile, back on the topic of data-free summertime Fridays, bonds are off to a slightly stronger start with the characteristically overdone movement at the 8:20am CME open (often the morning’s main source of movement/volatility when participation is light and data is absent).

Rising interest rates during June worked to hold potential new homebuyers out of the market, the Mortgage Bankers Association’s Builder Application Survey found.

The incident occurred in November 2020 when an unauthorized party gained access to company systems and deployed ransomware, resulting in compromise of employees’ personal information.