Change is constant. Soon I head to Austin, in the Great State of Texas, for the TMBA’s star-studded Housing Summit where “change” will certainly be studied. JPMorgan is embracing block chain. Tired of your cleaning supplies smelling like lemon? How about pumpkin, or birthday cake? “Rob, are you hearing from other brokers or LOs that their borrowers are demanding lower rates on their ‘lock’ since the Fed changed?” I am, and it is a great opportunity to be a knowledgeable human (instead of a robot) and explain why it isn’t the case: that overnight rates are not the same as 30-year rates. The Fed intends to change its policy of balance sheet runoff, ending it but still letting the portfolio of mortgage-backed securities mature without replenishing them. Change may happen with the 2026 mid-term elections approaching, the industry can expect significant stakes tied to a potential shift in congressional power. Register for MAA’s Next Quarterly Webinar on Tuesday, November 4, from 3:00-4:00 PM ET to hear updates on major efforts like the bipartisan ROAD to Housing Act, the possible re-privatization and release from conservatorship of Fannie Mae and Freddie Mac, the future of credit score pricing, the regulation of Artificial Intelligence (AI), and more. (Today’s podcast can be found here and this week’s are sponsored by Optimal Blue, the only end-to-end capital markets platform built to power performance, precision, and profitability, helping lenders of all sizes operate more efficiently, manage risk more effectively, and maximize results. Today’s has an interview with dataqollab’s Adam Quinones on how Fed actions and rhetoric have been influencing bond movement and MBS spreads.)

The head of the government-sponsored enterprise’s oversight agency said the cuts were made to positions that weren’t central to mortgages and new home sales.

Uncover how high-speed internet access drives property valuations, creates lending opportunities, and transforms mortgage markets nationwide.

Rocket Companies lost $124 million on a GAAP basis, but its management celebrated milestones regarding its Redfin and Mr. Cooper acquisitions.

The tech giant provided context around Flagstar and Pennymac’s moves, as it reported more Encompass and MSP clients and greater mortgage income.

Instances of miscommunication between servicers and borrowers have declined, but some warn that CFPB stepping back from enforcement could create oversight gaps.

Are you ready to change the time on your car’s clock, or leave it and let it be right again on March 8, 2026? Some technology is cool. Imagine controlling your iPhone entirely with your eyes. (That would really keep me from riding my bike and talking on the phone!) Food delivery robots have human names and blinking eyes. But they’re not our friends any more than the Russians are our allies. Every lender and title company knows that cybercriminals don’t take breaks, and neither do data breaches. The TransUnion breach exposed the personal details of over 4.4 million Americans. If your information was among them, your identity could already be at risk. Bank hacking incidents have doubled since 2023, and bank investors are spooked. When you receive a letter or an email saying your personal information may have been compromised, do you even care? Do you look at maps of cyber-attacks, and just shrug and hope your IT department is on the ball? Good luck. (Today’s podcast can be found here and this week’s are sponsored by Optimal Blue, the only end-to-end capital markets platform built to power performance, precision, and profitability, helping lenders of all sizes operate more efficiently, manage risk more effectively, and maximize results. Today’s has an interview with Finance of America’s Adam Potafiy on reverse mortgages and how they’re being reengineered for the next generation of clients.) Services, Products, Software, and Tools for Lenders and Brokers

Every now and then, a Thursday comes along where we have to set the record straight on what is actually going on with mortgage rates. That’s because Freddie Mac releases its weekly mortgage rate survey on Thursdays and its methodology can cause confusion in the mortgage market.  This particular Thursday is an especially treacherous minefield of misinformation due to the juxtaposition with yesterday’s Fed rate cut.  There are already too many people out there repeating the faulty notion that the Fed rate cut means lower mortgage rates. Adding fuel to that fire are various headlines today (quoting Freddie’s data) saying that mortgage rates have fallen to the lowest levels in more than a year. Mortgages rates certainly WERE at the lowest levels in more than year when we reported that fact on Tuesday. But what a difference 2 days make… Actual daily average rates are up 0.20% since then–the fastest 2 day rise since the exact same thing happened after last month’s Fed rate cut. We’d urge those who didn’t absorb the lesson back then to do so today.  Bottom line: mortgage rates had already responded to all of the news and data that resulted in the Fed rate cuts.  By the time those cuts actually happen, they have no additional power to influence rates (other than the Fed Funds Rate itself, which is not a mortgage rate except in limited cases specific to Home Equity Lines of Credit based on the Prime Rate). How does Freddie get it so wrong?  They don’t.  They just get it “so late.” Freddie is reporting their rate as an average of last Thursday through this past Wednesday, and 4 out of those 5 days saw exceptionally low rates. As we noted yesterday, mortgage rates were already surging higher, but not until the afternoon. This means even yesterday’s rate spike was too late in the day to push Freddie’s average any higher.  In other words, it was perfectly bad timing for Freddie’s Thursday release to be as low as it possibly could have been.

Uneventfully Flat After Initial Weakness

The bond market only had a little more selling to do thanks to the unpleasant tailwind from Wednesday afternoon’s Fed press conference. That said, one could also argue that corporate bond issuance was the source of early weakness.  Either way, yields are now back where they would have been in lieu of the Oct 10th tariff announcement and the Oct 16th regional bank drama (the two biggest recent events that pushed them lower).  Fed rate expectations for the December meeting are worse off–nearly back to levels seen BEFORE the jobs report that came out in early September. This highlights the extent to which the market was overestimating the near-term rate cut path. What next? More of the same: waiting for data that won’t be reported and making do with available private data. 

Market Movement Recap

10:07 AM mostly flat overnight with some additional selling starting just before the open.  MBS down 3 ticks (.09) and 10yr up 2.4bps at 4.096

12:52 PM Decent recovery.  MBS unchanged and 10yr up only 1.4bps at 4.085

03:20 PM 10yr yields are still off the morning highs, but up 2.3bps at 4.095.  MBS down 2 ticks (.06) on the day and 6 ticks (.19) from the highs.

The simplest way to understand yesterday’s post-Fed sell-off is as follows. The market’s enthusiasm for 3 Fed rate cuts in 2025 had grown a bit too large for the Fed’s liking. The market was nearly 100% certain of another cut in December. The Fed was not as certain, and Powell made it a point to say so yesterday. The result is a mild re-set in yields back to levels that are more consistent with a December cut being a solid possibility, but not a full lock.  Now we wait to see if the non-gov econ data tips those scales in one direction or the other.  This morning’s additional selling is an acceptable and arguably inconsequential level of follow-through to the brunt of yesterday’s “reset” vibes.

In terms of specific Fed rate expectations: