Sep. 10: Non-QM, post-closing, QC, warehouse products; Pulte vs. Bessent; Conventional conforming updates; nice jump in apps
“Rob, I hate it when mom and dad fight. Will this Pulte/Bessent, FHFA/Treasury tussle impact mortgage rates?” Probably not; it hasn’t so far. Director Pulte is certainly in the news. Occupancy isn’t a partisan issue, right?! FHFA Director Pulte, who continues to point out potential fraud by Fed. Governor Lisa Cook (who a Federal judge ruled yesterday could stay in her post), has two close relatives who have declared the same owner-occupied status on two homes in two different states! Don’t blame me: read about it in CNBC and Reuters. “Mark and Julie Pulte, the father and stepmother of Bill Pulte, President Donald Trump’s appointee as director of the Federal Housing Finance Agency, since 2020 have claimed so-called ‘homestead exemptions’ for residences in wealthy neighborhoods in both Michigan and Florida…” What about news closer to regular lending? Chase launched some publicity with a limited-time “mortgage rate refinance sale.” The Chase promotion is on rate-and-term and cash-out refinances through Sunday, Sept. 21. Customers must lock in their refinancing rate during this period to earn the discount. How much of a discount? According to Chase, "Discounts will vary by mortgage product and location." (Today’s podcast can be found here and this week’s are sponsored by Indecomm. Streamlining operations with the genius blend of automation, AI, and services. Achieve practical digital transformation and real operational impact with Indecomm’s purpose-built mortgage solutions. Hear an interview with MCT’s Phil Rasori on shifting coverage in response to policy and economic changes, to the expansion of ARM and non-QM products, the growing role of AI in hedging and analytics, evolving tech freeing up staff for strategic work, and the rising demands placed on modern capital markets departments.)
Services, software, and tools for lenders and brokers
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Combat Occupancy Fraud with Confidence! First American Data & Analytics combines unmatched property data and advanced detection tools to prevent occupancy misrepresentation at origination and post-close. Whether you need broad fraud and compliance analysis or targeted misrepresentation detection, we’ve got you covered. Use the FraudGuard solution for comprehensive insights into counterparties, identity and property risk, undisclosed liabilities, and more. Or deploy our Occupancy API as a standalone solution to pinpoint occupancy misrepresentation with precision. Protect your lending process from costly fraud risks: start with First American Data & Analytics.
“PlainsCapital Bank National Warehouse Lending, a subsidiary of Hilltop Holdings (NYSE: HTH), understands the importance of efficiency when it comes to meeting mortgage lenders funding requests. “Express Funding” is how we help our customers reduce the time needed to get loans funded quickly. Express Funding allows our customers to submit multiple loans for funding in one simple data upload, whether it is one loan or 100 loans. We have a growing list of 5,000+ approved closing agents, No Doc funding requirements and funding turn times averaging under 20 minutes! As a well-capitalized financially strong banking partner we give our customers confidence in an uncertain market. If you are interested in learning more about PlainsCapital Bank National Warehouse Lending please contact Deric Barnett, (469)955-6786.
ACES Q1 2025 Mortgage QC Industry Trends Report reveals early signs of loan quality risk amidst mounting market pressures. Defect rate increases from historic low as underwriting pressures, shifting borrower profiles and market volatility test lenders’ quality control processes. “The rise in critical defects this quarter underscores how market volatility and operational pressure can impact loan quality,” said Nick Volpe, executive vice president at ACES Quality Management. “At the same time, we’re seeing that lenders who invest in automation and proactive quality control are making measurable improvements, particularly in underwriting and compliance.” Notable findings include: The overall critical defect rate rose 12.93 percent to 1.31 percent, ending a two-quarter improvement streak. Income/Employment defects increased 42.5 percent. Borrower and Mortgage Eligibility defects surged 328.57 percent quarter-over-quarter, while Credit defects rose 11.96 percent. Assets, Legal/Regulatory/Compliance, and Appraisal categories posted significant improvements. Read the full report.
For too many lenders, post-closing means endless follow-ups, missing documents, and constant compliance worries. It doesn’t have to. With DocGenius and Indecomm’s Post-Closing Hub, you can reimagine post-settlement processes as streamlined, automated, and predictable. We handle post-settlement document audits, U.S. recordings, eRecordings, assignments, lien releases, and trailing docs with speed, accuracy, and consistency, helping you cut cycle times, contain costs, and strengthen compliance. Instead of firefighting issues after they arise, your team gains visibility, confidence, and control. Indecomm makes it possible to move past inefficiency and achieve stronger investor relationships, reduced risk, and measurable ROI. It’s time to rethink post-settlement, and move it forward with Indecomm’s DocGenius. Get a DocGenius demo today.
The Chrisman Marketplace is a centralized hub for vendors and service providers across the mortgage industry to be viewed by lenders in a very cost-effective manner. We’re adding new providers daily, so check back often to see what’s new. To reserve your place or learn more, contact us at info@chrismancommentary.com.
Correspondent and wholesale products
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“Wealth Beyond W-2s: Your affluent clients have accumulated wealth but lack W-2s. International buyers want U.S. real estate without the domestic credit history. Sound familiar? As Q4 triggers year-end tax planning, these scenarios multiply. Logan Finance's Asset Qualification program accepts both liquid and non-liquid assets at full value, with no haircuts required. Simply divide by 60 or 180 months to establish income, with no employment verification needed. Foreign National loans need no U.S. credit score, opening doors for buyers building long-term U.S. portfolios, from vacation properties in premier destinations to rental investments for sustained dollar-denominated income. With loan amounts up to $3M, we transform complex financial profiles into lasting client relationships. While conventional lenders see roadblocks, we see opportunity. Our team understands retirement transitions, generational wealth, and cross-border investment strategies. Ready for long-term success? Email bizdev@loganfinance.com for dedicated scenario desk support. We work hard to make non-QM easy. NMLS #127722”
“Verus Mortgage Capital is proud to announce that we crossed $40 billion in cumulative acquisitions last week and recorded our best lock and funding month in company history, a clear signal that momentum is on our side. With origination volume continuing to climb, we’re confident that our ambitious $10 billion non-agency production goal for 2025 is achievable. Non-QM isn’t just gaining traction. It’s setting the pace for growth in today’s market. Borrowers are looking for solutions beyond the agency box, and lenders who can deliver flexible products are the ones winning business. That’s where Verus comes in. We’re committed to providing innovative programs, consistent execution, and the trusted expertise originators need to compete. Our partners know that working with the market leader in non-QM means more opportunities to say “yes” to more borrowers. If you’re not already doing business with us, you should be. To get started, contact Jeff Schaefer, EVP of National Sales, at 202-534-1821.”
Conventional conforming, aka GSE, morsels
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Fannie Mae published the results of its August 2025 National Housing Survey® (NHS), which includes the Home Purchase Sentiment Index® (HPSI), a measure of consumer sentiment toward housing. Month over month, the HPSI decreased 0.4 points to 71.4. Year over year, the HPSI is down 0.7 points. For more information, access the latest data release or the key indicator data file.
Freddie Mac and Fannie Mae (the GSEs) have published new and updated resources to help industry partners prepare for enhancements to the Uniform Collateral Data Portal® (UCDP®) user interface and direct integration. These enhancements support the Uniform Appraisal Dataset (UAD) 3.6 and Forms Redesign Limited Production Period. View Freddie Mac’s Announcement for additional information.
Fannie Mae released its September Selling Guide 2025-07 providing updates bringing you more flexibility and clarity. Key changes include removal of the term “appraisal waiver” from use alongside “value acceptance” in the Selling Guide, revised two requirements of the framework for a borrower-initiated reconsideration of value, expanded eligibility requirements for manufactured homes, and clarified borrower ownership interest in life estates.
In February, Fannie Mae introduced new cybersecurity and business resiliency requirements for Single-Family sellers and servicers and Multifamily lenders in the Fannie Mae Information Security and Business Resiliency Supplement (the "Supplement”). Review the latest Bulletin for guidance on how changes announced September 2nd may impact your organization.
In addition to offering the low-cost financing Manufactured Home Advantages™ (MH Advantage®) on qualifying single-width homes, qualifying CHOICEHome-eligible homes are now eligible, and they can be used as comparable sales too. Read Fannie Mae’s Announcement SEL-2025-07 for details.
Freddie Mac’s Single-Family Seller/Servicer Guide (Guide) Guide Bulletin 2025-12 has been published. The Bulletin announced Guide updates related to Loan-to-value (LTV) ratios for certain mortgages secured by 2- to 4-unit properties, Reconsideration of Value (ROV) Third-Party Originator (TPO) oversight, MERS® revision, Cash-Released XChange® Document Custodians, and Guide refactoring.
Reduce loan defects and repurchase risks by mastering rental income calculations. Read Fannie Mae’s Quality Insider and learn more about avoiding common pitfalls and get expert guidance on accurate rental income calculations. Enhance your underwriting process by understanding requirements for using rental income to qualify borrowers.
Are you ready for enhanced efficiency and streamlined mortgage servicing operations? Start preparing now by reviewing Fannie Mae’s implementation timeline and taking the necessary steps toward a more efficient servicing future. Explore these changes in the Lender Letter and keep your eye out for an upcoming invite to a live webinar to review these exciting changes soon.
Detailed in Pennymac Announcement 25-85, Pennymac is aligning with Fannie Mae and Freddie Mac updated requirements for interested party contributions and lender incentives. These changes are effective with note dates on and after September 3, 2025.
Capital markets: applications… you weren’t alone in seeing the jump
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As noted in the opening paragraph, the Trump administration is intensifying discussions on the future of Fannie Mae and Freddie Mac, as tensions rise between Treasury Secretary Scott Bessent and FHFA head Bill Pulte. It’s an internal conflict that could complicate reform efforts. The Mortgage Bankers Association certainly doesn’t want them to merge. Treasury has launched a series of meetings with major stakeholders, including lenders, investors, and consumer advocates, to explore long-term changes to the mortgage giants, while Pulte is pushing for a near-term public offering of a small share of government-owned stock.
The agencies appear to be pursuing separate strategies, with Treasury focusing on systemic reform and FHFA signaling more immediate steps, such as a potential IPO. Despite political noise and speculation, especially around legacy shareholders and skyrocketing stock prices, most stakeholders expressed concern about weakening regulatory oversight or merging the two firms, which could raise mortgage rates and reduce market competition. While no decisions have been made, the overlapping roundtables highlight an emerging power struggle over who will control the path forward for the $7 trillion mortgage market.
Bonds sold off yesterday (after four days of gains that had sent yields to their lowest levels in at least three months) despite preliminary benchmark revision to payroll growth estimates from March 2024 to March 2025 revealed an overstatement of 911k jobs during that 12-month stretch. Ouch. The immediate market reaction to the payroll growth revision suggests refreshed worries about a potential stagflation scenario if inflation remains elevated while job growth continues to falter.
Yesterday the Bureau of Labor Statistics released preliminary benchmark revisions of job market data for the last year through March, which showed that the total number of workers on payrolls is likely to be revised down by 911,000. Government data from before the revision indicated that the U.S. economy created roughly 1.8 million jobs in the 12 months preceding March, around twice what it now believes to be the actual number. The report adds weight to the claim that the U.S. is experiencing a weak jobs market and makes it more likely that the Fed will cut interest rates during its September meeting. Oddly, it had no obvious impact on rates.
Security prices are usually a direct factor of supply and demand. Yesterday’s 3-year Treasury auction was notably strong (especially regarding foreign demand), featuring a stop-through of 0.8-basis points and robust non-dealer participation at 91.6 percent, well above the recent 84.1 percent average. The auction stopped at 3.485 percent, significantly lower than the six-auction average of 3.841 percent. Demand was solid, with a bid-to-cover ratio of 2.73x compared to the typical 2.55x. Dealers took a smaller share than usual, accounting for only 8.4 percent versus their 15.9 percent average, while direct bidders claimed 17.4 percent, slightly below their 21.9 percent norm. Indirect bidders dominated, securing 74.2 percent of the offering compared to an average of 62.1 percent. Prior to the auction, Treasuries were experiencing some selling pressure with yields near session highs, but following the auction results, yields eased slightly, reflecting positive market reception.
The SOFR curve (the Secured Overnight Financing Rate is a secured overnight interest rate, a reference rate established as an alternative to LIBOR) suggests investors expect policy rates to bottom around 2.89 next year, reflecting hopes for a soft landing, avoiding both a recession and the need for aggressive Fed easing. This outlook assumes a gradual labor market recovery and manageable inflation, allowing a steady return to neutral rates. However, it may underestimate the risk that the Fed could need to cut more deeply if the economy weakens further. As the market flirts with pricing a 50-basis points cut, the conversation is likely to shift toward whether rates will fall below neutral.
Today’s economic calendar kicked off with mortgage applications increasing 9.2 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 5. This week’s results include an adjustment for the Labor Day holiday. We’ve also received the August Producer Price Index report (-.1 percent and -.1 percent ex-food & energ). Later today brings wholesale inventories and sales, and Treasury activity that will be headlined by a $39 billion auction of reopened 10-year notes and a buyback (liquidity) in 5- to 7-year coupons for up to $4 billion. We start Wednesday after the non-event PPI with Agency MBS prices approximately unchanged from Tuesday’s closing levels, the 2-year yielding 3.53, and the 10-year yielding 4.06 after closing yesterday at 4.07 percent.
I’m reading a book on helium. I can’t put it down!
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