In the past few years, plaintiffs have lodged over 65 complaints against real estate companies regarding unsolicited text messages and phone calls.

A former employee of The Change Company, which is the largest non-traditional mortgage lender in the U.S., claims in a new lawsuit that the firm mischaracterized the race, ethnicity and income of its borrowers. The company says the allegations, which relate to the representations it makes to be certified as a community development financial institution, are meritless.

Adjustments to area median-income levels will make more residents eligible after the state opened up the Homeowner Assistance Fund to households with pandemic-related partial claims or loan deferrals earlier this year, the program said.

Still Waiting For a Breakout After Friday’s Uneventful Strength

Friday began with solid gains courtesy of weak PMI data in Europe overnight and some follow-through buying in early US trading.  Sellers surfaced at the 9:30am NYSE open and their numbers grew after US PMI data failed to live up to EU’s negative hype.  The net effect was the transformation of a strong rally into an uneventful rally by mid day.  Treasuries gave up just over half of the overnight gains and stayed flat into the 3pm CME close.  MBS were slightly more volatile, but only superficially (due to illiquidity).  The modest gains leave bonds in the prevailing range and they leave us waiting for a confirmed breakout from that range.

Econ Data / Events

S&P Manufacturing PMI

46.3 vs 48.5 f’cast, 48.4 prev

S&P Service PMI

54.1 vs 54.0 f’cast, 54.9 prev

Market Movement Recap

10:03 AM Limited push back against overnight rally.  10yr still down 8bps at 3.717.  MBS up .125 to .25 depending on liquidity.

01:42 PM Holding ground now after mid-day weakness. 10yr down 5.5bps at 3.742.  MBS up about a quarter point.

03:18 PM Flat through the 3pm CME close with MBS still up roughly a quarter point and 10s down 5.3bps at 3.744.

A majority of the housing market data on any given month tends to come out mostly on the same week. This was that week and the takeaway was that the housing market could be doing worse. Some might even argue that we’re seeing some resilience relative to the rate landscape. Let’s refresh our understanding of the rate landscape first.  The bond market (which drives interest rate movement) has been broadly sideways recently as investors wait to see how quickly inflation (bonds’ biggest concern) is subsiding.  That “wait and see” approach prompted the Fed to hold its policy rate steady at last week’s meeting, but that was widely expected by the bond market and thus not worth much of a reaction. Fed Chair Powell gave his regularly-scheduled congressional testimonies this week and had a chance to talk a bit more about where the Fed sees things going from here.  We already knew the average Fed member saw about 2 more rate hikes before achieving a terminal “ceiling” level, assuming the economy evolved as expected, but Powell was able to clarify what “as expected” meant. Interestingly enough, the additional hikes are  not seen happening in response to some additional upward momentum in inflation or economic growth.  Rather, the Fed’s baseline expectations call for continued cooling in the labor market, modest economic growth, and continued cooling in inflation.  In other words, inflation and the economy have a very low bar to justify a few more rate hikes.  Things would have to deteriorate pretty abruptly for the Fed to abstain.  Moreover, if things improve a bit better than expected, we could be looking at more than 2 additional hikes.

Time is an interesting construct. The solstice is officially behind us, and we can officially hum “The Boys of Summer” with impunity. Time… “5,000 years of eating bread. And in less than a decade it seems half the population is allergic to gluten!” Shifting times, and ages, mean a lot to LOs. If 10,000 people a day turn 62, does that mean reverse mortgages might be worth exploring? I don’t know when the terms “elderly” or “middle-aged” became politically incorrect. How about the term “geriatric millennial?” Although there appears to be a bit of a baby boom going on, no one’s getting any younger: The nation’s median age increased by 0.2 years to 38.9 years between 2021 and 2022, according to Vintage 2022 Population Estimates released by the U.S. Census Bureau. (“Median:” half above and half below.) A third (17) of the states in the country had a median age above 40.0 in 2022, led by Maine with the highest at 44.8, and New Hampshire at 43.3. Utah (31.9), the District of Columbia (34.8), and Texas (35.5) had the lowest median ages in the nation. Hawai’i had the largest increase in median age among states, up 0.4 years to 40.7. LOs ignore demographics at their own risk. (Today’s podcast can be found here and this week’s is sponsored by MCT and its Hedge Advisory division. Download their recently released whitepaper, Mortgage Pipeline Hedging 101, for more information on hedging in today’s market. Today’s has an interview with MCT’s Andrew Rhodes on assignment of trade – AOT – and loan sale automation.)

Granted, today’s only available domestic economic data is the S&P PMIs, but the market could have justified either a stronger or weaker response.  The services PMI was right on target, falling slightly from last month but still connoting expansion. The manufacturing PMI missed by 2.2 points to push even deeper into contraction territory.  Rather than lean on the lackluster showing to solidify the AM rally, bonds have given up more than half of the overnight gains in early trading.  The result is another day that looks set to reinforce the same old trading range.

The Connecticut company has been growing both on the originations and servicing sides of the business.

Under guidelines proposed this month, credit unions would see changes in the quality standards for computer-generated appraisal systems, along with when and how financial institutions and consumers can request reconsiderations of value.

The government-sponsored enterprise has shared $25.2 billion of insurance coverage through its Credit Insurance Risk Transfer program.