“Keeping Pace with the Ebb and Flow: A Close Analysis of Mortgage Rates in 2024”

The notable employment report that usually releases on the first Friday of every month plays a crucial role in influencing interest rate instability. Today was no different, but it is worth noticing that the potential magnitude of the impact doesn’t always match its real effect. Initially, it gave an impression of justifying its influence when the report indicated a surprising increase in job creations, which typically leads to higher interest rates. Consequently, the bonds correlated with mortgage rates started to escalate after the release of these figures. However, other data facets in the report helped to counterbalance this effect in no time.

Moreover, other relevant economic indicators contributed to managing the initial reaction. According to the Institute for Supply Management, the ISM Services index, an extensive measure of the service sector’s wellbeing, dropped to levels signaling negligible growth. The employment element of the index, which carries more significance, reached its lowest since the covid restrictions, making the bond market react more readily than to the jobs report.

Despite a slight dip in the afternoon, the overall impact was reasonably favorable for mortgage rates with the bond market ending virtually unaltered. The day concluded with the average mortgage lending rates being slightly lower than the previous day.

“Projecting the Future of FHA: A Loss of $7 Billion and the Potential Impact on Reverse Mortgages”

The Congressional Budget Office raises an alarm that the Federal Housing Administration is at risk of a multi-billion dollar deficit come 2024. Furthermore, delays in legislative actions could potentially lead to mandated budget cuts.

“Former Citizens Bank Executive Joins Pennymac TPO: A Strategic Move in Mortgage Lending Industry”

Pennymac has announced Kristy Dickey as the newest FVP of TPO sales. Furthermore, the company has boosted its team with the addition of five senior account executives, who were previously part of Citizens until it made the decision to withdraw from its wholesale channel.

“Revolutionizing Homeownership: Innovations and Updates in Rocket Pro TPO Mortgage Products”

The expansion of the wholesale division of Rocket Mortgage now includes an enlargened ONE+ program, in addition to incorporating Fannie Mae HomeReady and Freddie Mac Home Possible loans into their range of services.

“Insights into the Mortgage Backed Security Market Dynamics: An Overview of January 5, 2024”

The week concluded with contrasting performances from the jobs report and the ISM Services data. While the former created some disruptions, the latter managed to offset them, suggesting that the vibe is more nuanced than it appears.

Could it be that the ISM Services data wielded more influence over market movements and volumes than the jobs report did? Surprisingly, the answer is affirmative, although there are some justifications. It’s fair to classify the jobs report as two-edged today. It surpassed predictions at surface level. Nevertheless, revisions sent the figures of preceding months downward. While the jobless rate stuck to 3.7%, a 0.3% drop in the participation rate effectively pushed the net increase to 4.0%. Hence, today’s jobs report didn’t really grab the headlines, which is apparent in the chart showing the bond market completely overturning the trade just before ISM came into play.

The weight of the ISM data was more noticeable. It turned out to be the feeblest report of the past few years in several aspects, principally concerning the employment factor. This piqued the market’s interest more than anything else, but it fell short of establishing a durable motivational source for bond bulls.

“Maximizing Your Profit: A Guide to No-Closing-Cost Refinancing”

Refinancing your mortgage under a no closing cost scheme means that the lender assumes responsibility for all initial closing costs. For the borrower, this entails having a somewhat increased interest rate on their fresh loan.

“Exploring the Future of Mortgages: Industry Insights and Predictions for 2024”

As we move beyond the customary period for sharing New Year greetings, crucial subjects such as the “ability to repay” regulations remain vital and memorable for mortgage lenders and vendors. Brian Levy, a legal expert and author for Mortgage Musing blog, recently provided a discourse on the significance of the Dodd Frank Act’s Ability to Repay Rule. This rule is designed to protect both lenders and borrowers from triggering a reoccurrence of the 2008 housing market crash. Additionally, Levy elaborated on the CFPB’s latest enforcement action against Colony Ridge, which focused on fair lending practices, violation of the LEP language exploitation, and the Interstate Land Sales and Full Disclosure Act of 1968.

At present, approximately 4-6,000 lenders are engaged in HMDA-related paperwork. For timely discussions and strategic insights in the mortgage industry, consider tuning into the STRATMOR Group’s sponsored weekly podcast.

Simultaneously, broker and lender service providers, programs, and software are encouraging a strong start to the year. Rocket Pro TPO is inviting clients for IGNITE Live hosted by EVP, Mike Fawaz on January 8th at 4pm ET. Key announcements and insights on new products and technologies will be presented. They also announced an upgrade to their ONE+ by Rocket Mortgage product, which now includes Freddie Mac’s LPA. This could result in a 16 percent increase in client eligibility, with the lender further offering to cover 2 percent of the client’s purchase price as a down payment, but no less than $2,000. They’ve also introduced a new 1 percent LLPA credit for Fannie Mae HomeReady and Freddie Mac Home Possible loans of no more than $350,000, guaranteeing at least a $2,000 benefit. For further information, please communicate with your Rocket Pro TPO Account Executive.

“Understanding the Decreasing Trend in Reverse Mortgage Volume and Securities Issuance in December”

In examining the data on Home Equity Conversion Mortgage (HECM) activity for December 2023, Reverse Market Insight (RMI) aptly captioned their observations with the term “thud.” Given the demanding circumstances recorded across 2023, that year ended disappointingly in terms of HECM endorsement volume and the issuance of HECM-backed Securities (HMBS), presenting a less than ideal closure to […]

“Understanding the Intricacies of Bond Markets and Mortgage Rates – A Comprehensive Recap for January 2024”

The trading session on Thursday served as quite the grim yet essential reminder of how “data dependence” can swing in both directions when it comes to its influence on the bond market. Yesterday, weaker data served to keep rates under the 4% threshold, but today’s data seemingly reversed that trend. However, these trends may not have significant implications on the grand scale of things, but the forthcoming employment report on Friday might indeed sway the narrative if it strays significantly from the forecast.

Economic Data / Events:

– ADP Employment: 164k actual vs 115k forecast, 101k previous
– Jobless Claims: 202k actual vs 216k forecast, 220k previous

Market Movement Recap:

– 08:34 AM: The market showed signs of weakness overnight, primarily driven by Europe. Continued selling post-data. The 10-year yield rose by 7bps to 3.989. MBS fell by 10 ticks (0.31).
– 12:20 PM: There was a bit of unevenness, but the market largely moved sideways throughout the morning. MBS dropped by 9 ticks (0.28). The 10-year yield rose by 7.3bps to 3.993.
– 02:19 PM: MBS hit their lowest point for the day, with 5.5 coupons down 3/8ths in total. Meanwhile, 10-year yields approached their peaks, rising by 8.1bps to 4.001.

“Rocket Companies Welcomes Former Airbnb and Coca-Cola Executive as Its First-Ever Chief Marketing Officer”

Jonathan Mildenhall has been appointed as the Chief Marketing Officer for Rocket Companies, a company headquartered in Detroit. This role is a fresh addition to the company’s executive line-up.