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- Interesting Insights
Interesting Insights
By Jeff Walton & Kelly Guest
Our trusted industry experts have some great takes this week: In his latest Master the Markets segment, Bill Bodnar says that recent jobs + retail sales figures = no Fed rate hike and explains how the new "no forward guidance" policy is an opportunity for lending professionals to add value. From our partner HousingWire, analyst Logan Mohtashami may help the industry feel better by explaining why things aren't worse.
Table of Contents
CHATTER
“Hug a Mortgage Spread?”
HW’s Logan Mohtashami on the Current Rate Situation:
Historically, mortgage spreads have ranged from 1.60% to 1.80%. Last week, spreads were at 2.01%, up from 2.0% the week before.
Let’s compare last week’s mortgage rates to where they would have been over the last three years, given the 10-year yield’s current level:
If we had the worst mortgage spread levels of 2023, mortgage rates would be 7.84% today, not 6.74%.
If we had the worst levels of 2024, mortgage rates would be 7.46% today.
If we had the worst levels of 2025, mortgage rates would be 7.27% today.
Move or Spend More? Gen Z Says MOVE
A new survey from NewHomeSource, Understanding Our Next Generation of Homebuyers, finds that …
· 63% of Gen Z would relocate to a new city or state to buy a home
· 19% say they'd rather just spend more
· 39% of Gen Z plan to buy within the next five years
When asked what they'd actually be willing to do to buy, Gen Z's top answers all pointed to location:
· Relocate to a less expensive area within their state (35%)
· Explore a different neighborhood (33%)
· Relocate to a more affordable state (28%)
Respondents said they'd rather relocate than buy smaller, settle for lower-quality finishes, or lose out on amenities. Their wish list:
· A large backyard (32%)
· A garage (32%)
· A pool (28%)
· A large kitchen (27%)
Newrez Agrees to $15.5M Settlement - HW
Newrez agreed to a $15.5M settlement with regulators in 46 states and Washington, D.C. over lender-placed insurance practices. The deal includes $9.9M in penalties and $4.51M in consumer relief that Newrez has already paid.
More Biz, Same Sales Force: FAM’s Proprietary Products Drive Increase - NMN
Finance of America has been widening that product reach. In July, the lender expanded HomeSafe Second into four additional markets, bringing the second-lien reverse mortgage to 19 states and Washington, D.C.
The product allows qualifying homeowners to access equity without refinancing an existing first mortgage or adding a required monthly principal-and-interest payment.
$500M Beef
Downgrade + Lawsuit: UWM Goes After Two Harbors Alleging “Willful Breach,” Fraud
UWM alleges TWO’s leadership deliberately undermined the stockholder process for UWM’s transaction, including by sabotaging the March 16 meeting scheduled to approve the deal. UWM also claims TWO threatened to sell RoundPoint Mortgage Servicing Corp., its servicing subsidiary, to CCM if UWM would not agree to keep TWO’s business operating after an acquisition.
UWM is seeking more than $500 million in damages, citing alleged lost profits, expected synergies, foregone capital-efficiency opportunities, and costs incurred to keep the deal on track, among other items.
MOVING & SHAKING
Better founder and former CEO Vishal Garg making moves to regain control, demands resignation of several directors.
Dream Finders Homes to acquire Beazer Homes to create nation's 6th largest home builder.
Acrisure Mortgage names Todd Boss President.
Radian Reorganization: Sale of its real estate services to PLACE is complete; title sale to close in Q4.
Mike Weinbach, Radian CEO-Elect says they're focusing in: “We believe our leading mortgage insurance franchise and specialty insurance business create a strong foundation for disciplined capital allocation and long-term value creation, while expanding our access to large, diversified global markets.”
Mike Weinbach assumed role of CEO at Radian and joined BOD.
Certainty Home Lending named Bryan Ingenito EVP and National Operations Executive - NMP
Bad Breakup
NEXA Seeks Restraining Order on Fired LO (NMN)
Part of claim says he “refuses to return leads.”
MARKET/INDUSTRY
Mortgage Rates Average 6.67%: Freddie 8-13-26
Mortgage Applications Increased 3.6% from One Week Earlier: MBA Weekly Survey for the week ending 8-7-26.
· The Market Composite Index, a measure of mortgage loan application volume, increased 3.6% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 3% compared with the previous week.
· The Refinance Index increased 5% from the previous week and was 22% lower than the same week one year ago.
· The seasonally adjusted Purchase Index increased 3% from one week earlier. The unadjusted Purchase Index increased 2% compared with the previous week and was 1 percent lower than the same week one year ago.
· Mortgage Credit Availability Up in July: The MCAI rose by 2.5% to 108.4 in July. A decline in the MCAI indicates that lending standards are tightening, while increases in the index are indicative of loosening credit. The index was benchmarked to 100 in March 2012. The Conventional MCAI increased 3.0%, while the Government MCAI increased by 1.8%. Of the component indices of the Conventional MCAI, the Jumbo MCAI increased by 4.2%, and the Conforming MCAI fell by 0.2%.
Summer Slump: NAR EHS July 2026
Month-Over-Month
1.7% decrease in existing-home sales to a seasonally adjusted annual rate of 4.06 million in July.
1.9% decrease in unsold inventory to 1.54 million units, equal to a 4.6-month supply.
Year-Over-Year
0.7% increase in existing-home sales.
2.0% increase in median existing-home sales price to $434,100.
“Home sales have been remarkably stable, even amid the rising mortgage rate environment of the past few months. Year-to-date sales are up 2.4% and there’s no doubt that the housing market would be thriving if average mortgage rates were to return near 6%.” - NAR Chief Economist Lawrence Yun.
Other insights from the release:
Median time on market: 29 days, up from 28 days last month and one year ago.
First-time homebuyers accounted for 29% of sales, down from 33% in June and up from 28% one year ago.
Cash sales represented 26% of transactions, up from 25% last month and down from 31% one year ago.
Individual investors or second-home buyers accounted for 14% of transactions, up from 13% last month and down from 20% one year ago.
Distressed sales (foreclosures and short sales) represented 2% of transactions, unchanged from last month and one year ago.
Tipping of the Scale
Buying Boost: Number of Buyers Drops to New Low - Redfin
Sellers outnumbered buyers by 51% in July—just shy of December’s record high—giving buyers more negotiating power.
The number of buyers in the market fell to a record low of about 967,000 amid historically high housing costs, almost half a million fewer than the 1,463,000 sellers.
Nearly 80% of major U.S. metros are now buyer’s markets, led by Miami (154% more sellers than buyers), Nashville and a trio of Texas cities. House hunters in those places have a lot of negotiating power.
There are just 6 seller’s markets in the U.S., led by New York City suburbs, where demand is relatively strong.
Most buyer’s markets got even more buyer-friendly in July, with 34 of 39 metros seeing bigger seller surpluses, led by Miami, Seattle and Fort Worth.
Price Differences: ICE August Mortgage Monitor
July annual home price growth hits 14-month high
Annual home price growth rose to 1.5% in July, marking its fifth consecutive month of acceleration and its steepest single-month increase since mid-2023. The jump reflects lower rates early in 2026 injecting demand into the market, as weak summer 2025 prices roll out of the comparison window. However, as rates have moved higher, one-month adjusted price gains have softened, suggesting that further acceleration in the second half of the year may be limited.
Equity hits record high; negative equity elevated among recent-vintage borrowers
· Mortgage holder equity hit $18T in Q2, a new all-time high, as lower rates earlier in the year supported renewed home price appreciation. Within that total, 47.5 million mortgage holders hold $11.7T in tappable equity, averaging approximately $212,000 per borrower.
· Despite the strong overall picture, approximately 813,000 borrowers are underwater — up 44% year-over-year — concentrated among FHA and VA borrowers
Rate variation among similarly qualified borrowers
· Borrowers with nearly identical credit profiles are locking meaningfully different interest rates, averaging a 38-basis-point spread among conforming purchase borrowers in 2026. On a $300,000 mortgage, that difference translates to roughly $76 per month and approximately $5,790 in additional costs over the first five years.
· Among FHA and VA borrowers, that spread widens to 47 and 48 basis points respectively, with the widest variation concentrated among borrowers with lower credit scores, smaller loan balances, higher loan-to-value ratios, and those using government-backed loan programs.
Real estate owned (REO) properties are selling at historically wide discounts
Buyers purchasing bank-owned REO properties did so at a 27.5% discount to comparable sales in June — among the largest in over two decades. Notably, the widest discounts relative to their own histories are appearing in markets that typically offer the least: Florida, Texas, California and the Mountain West. However, foreclosure rates and distressed purchase opportunities remain scarce in those areas.
Locked Out: Optimal Blue July Market Advantage
