October 3rd is a date that has come up many times in the past month of mortgage rate coverage. That’s because there’s been a veritable chasm between the rates on that day and every other day since then. Why? October 4th’s jobs report caused an uncommonly large rate spike with the 30yr fixed average moving from 6.26 to 6.53 in a single day.  And that was just the beginning. October 4th kicked off a rising rate trend that ultimately saw 30yr fixed rates move over 7.25% in January. While those highs proved to be temporary, rates have generally held in the high 6’s until the August 1st jobs report. The weaker labor market reading helped get the average 30yr rate back into the 6.5s–the lowest range since October.  On several occasions over the past few weeks, rates were able to claim the title of “lowest in 10+ months.”  But now that the calendar has ticked to September 3rd, any additional improvement means we’re at the lowest rates in 11 months. [thirtyyearmortgagerates] While that’s great news in the big picture, the day-over-day change is fairly small.  The average borrower may not see much of a change from yesterday’s levels.  Bigger moves are possible this week–especially after Friday’s jobs report–but it’s important to remember that those moves can play out in either direction, depending on the tone of the data.

Mortgage applications decreased modestly last week, with overall volume slipping 1.2%. The Mortgage Bankers Association’s weekly survey showed a decline in the seasonally adjusted Composite Index for the week ending August 29, 2025. “Mortgage rates declined last week, with the 30-year fixed rate falling to its lowest level since April at 6.64 percent. However, that was not enough to spark more application activity,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “Refinance applications saw a small increase, driven by FHA and VA refinances, but conventional refinances declined. Purchase activity pulled back, after a four-week run of increases, as slower homebuying activity led to declines in applications across loan types.” The Refinance Index rose 1% from the previous week and is 20% higher than the same week a year ago. The Purchase Index decreased 3% on a seasonally adjusted basis but remains 17% above last year’s level. The refinance share of total mortgage applications increased to 46.9%. ARM share rose to 8.8%. FHA share moved up to 19.9%, while VA share climbed to 13.8%. Mortgage Rate Summary:
30yr Fixed: 6.64% (from 6.69%) | Points: 0.59 (from 0.60)
15yr Fixed: 5.84% (from 6.03%) | Points: 0.84 (from 0.77)
Jumbo 30yr: 6.58% (from 6.67%) | Points: 0.39 (from 0.44)
FHA: 6.31% (from 6.35%) | Points: 0.74 (from 0.80)
5/1 ARM: 5.90% (from 5.94%) | Points: 0.34 (from 0.68)

“Twas the third of September, the day I’ll always remember… Wherever he laid his hat was his home, and when he died, all he left us was a loan…” Okay, maybe it was “alone.” Residential lenders aren’t alone out there. Our fates and fortunes often move in tandem with commercial lenders, so it is worth noting that the delinquency rate on Commercial Mortgage-Backed Securities (CMBS) for offices surged 62 basis points in August, to a record 11.7 percent, a full percentage point above the post-2008 peak of 10.7 percent, per the weekly commercial sector newsletter, the Kobeissi Letter. Returning to the “resi” sector, there is noise out there about the government declaring an “emergency” because of it. Lenders know the issues are complex. For example, Condotek offers a compliance report for condominium associations battling ineligibility for financing. These days, one never knows what will come out of the government, so we’ll keep our fingers crossed. (Today’s podcast can be found here and this week is sponsored by Gallus Insights. Mortgage KPIs, automated, at your fingertips. Gallus allows you to turn data from your various databases and systems into automated business intelligence and actionable insights. Hear an interview between Robbie and me on what the shift from summer to fall historically means for the mortgage industry.) Products, Services, and Tools for Lenders and Brokers As kids head back to the classroom, it is a good reminder that education fuels success not just for students, but for financial institutions as well. With U.S. homeowners holding trillions in tappable equity, demand for home equity products continues to grow. The real differentiator, however, is not only about rates or speed. It is about education. Lenders who invest in training their teams and guiding borrowers position themselves as trusted advisors, capturing opportunities others may miss. This new blog from FirstClose highlights strategies to help build a more confident front line, engage equity-rich homeowners, and drive long-term growth by turning knowledge into action. It is a quick, free read with practical insights for making the most of today’s home equity opportunity. Tappable equity is rising, and education is the key to capturing it. Read the full blog here.

Bonds were flat to just slightly stronger in the overnight session but a noticeable rally is underway following the JOLTS data (job openings and labor turnover survey). This is a new cycle low for job openings, just barely dropping below the level reported in April 2025 (for March).  MBS have gained about an eighth of a point since the data came out and 10yr yields dropped about 3 bps to 4.226.  Before the data, friendly Fed comments were already starting to help bonds push the best levels of the morning.

Here are the comments from Fed’s Waller that started at 8:42AM ET:
FED’S WALLER TELLS CNBC: WE SHOULD CUT AT NEXT MEETING
FED’S WALLER: DONT NEED TO GO IN LOCK-SEQUENCE OF RATE CUTS
FED’S WALLER: COULD SEE MULTIPLE CUTS, WHETHER IT’S EVERY MEETING OR EVERY OTHER WILL NEED TO SEE WHAT DATA SAYS
WALLER: WE KNOW WE’LL HAVE A BLIP OF INFLATION BUT IT WON’T BE PERMANENT, 6 MONTHS OUT WILL BE CLOSER TO 2%
WALLER: WE CAN ALWAYS ADJUST RATE-CUT PACE

Federal Reserve Governor Lisa Cook’s lawyers blasted President Donald Trump’s move to oust her as based on nothing more than a pack of “cut-and-paste” allegations related to mortgage fraud.

Figure Technology files for a $508M IPO, while co-founder Mike Cagney secures long-term control and a retention award tied to the company’s growth.

A pension fund has been suing former executives over two decades for misleading investors about the company’s subprime holdings before the financial crisis.

The American Fintech Council wants Congress to amend the Gramm-Leach-Bliley Act to preempt state privacy laws with both entity-level and data-level exemptions, as well as eliminating restrictions on the secondary use of data.

True ROI in mortgage tech comes from business goals, not operational fixes, writes the Chief Growth Officer of Rocktop Technologies.

Still in The Range as Bonds Wait For Bigger Influences

Bonds were noticeably weaker to start the new month with most of the losses arriving after the start of European trading overnight. Indeed there was strong correlation between EU sovereign debt and Treasuries–especially at the EU opening bell. Some news stories suggested bonds were selling off due to news that an appeals court ruling that Trump tariffs were illegal, but that news was out on Friday night. If it were a compelling bond market motivation, it would have been more visible in the overnight trading that took place before the EU open. Either way, yields remained well within the prevailing range and it continues to be this week’s big-ticket econ data that has the best chance of challenging that range for better or worse. 

Econ Data / Events

S&P Global Manuf. PMI (Aug)

53.0 vs 53.3 f’cast, 49.8 prev

Construction spending (Jul)

-0.1% vs -0.1% f’cast, -0.4% prev

ISM Manufacturing Employment (Aug)

43.8 vs — f’cast, 43.4 prev

ISM Manufacturing PMI (Aug)

48.7 vs 49 f’cast, 48.0 prev

ISM Mfg Prices Paid (Aug)

63.7 vs 65.3 f’cast, 64.8 prev

Market Movement Recap

10:20 AM sharply weaker overnight. Some traction even before the ISM data, but a bit more now. 10yr still up 3.4bps at 4.263 but down from highs just over 4.30% earlier.  MBS down only an eighth after starting out down a quarter point.

12:03 PM 10yr up 5bps at 4.279.  MBS down 6 ticks (.19)

03:07 PM Flat in the PM.  MBS down 6 ticks (.19) and 10yr up 5.2bps at 4.282