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Mega Merge
By Jeff Walton & Kelly Guest
**BREAKING**
Mr. Cooper joins forces with Rocket Companies: The Detroit-based fintech platform including mortgage, real estate, title and personal finance businesses, today announced a definitive agreement to acquire Mr. Cooper Group Inc. in an all-stock transaction for $9.4 billion in equity value. Early details from the release:
Combined company to service more than $2.1 trillion in loan volume Integrating Rocket's originations-servicing recapture flywheel with Mr. Cooper's servicing platform will drive down costs and improve the experience for the companies' nearly 10 million combined clients, representing 1 in every 6 mortgages
Transaction is expected to generate annual run-rate revenue and cost synergies of approximately $500 million
Survey says: Angst emerged as a theme in a slew of surveys that came out last week. NeighborWorks found that 48% of renters feel buying a home is out of reach, with only 15% feeling it’s “very possible.” Redfin uncovered what it calls a “cultural shift” regarding homeownership, pointing out that 32.6% Gen Z 27-year-olds owned their home in 2024, compared to 38.4% of Gen Xers when they were 27 and 40.5% of Baby Boomers when they were 27. Clever Real Estate’s revelation that 70% of U.S. consumers fear “an impending housing crash” rounds out the dreary trifecta.
CHATTER
District Court Dings DOGE: D.C. Judge rules that the CFPB must reinstate laid-off employees and resume operations. The ruling is connected to a lawsuit against CFPB acting director Russell Vought brought by the National Treasury Employees Union.
Federal Agencies Announce Intent to Rescind CRA: The Federal Deposit Insurance Corporation, Federal Reserve Board, and Office of the Comptroller of the Currency did a joint release stating their intent to issue a proposal to both rescind the Community Reinvestment Act (CRA) final rule issued in October 2023 and reinstate the CRA framework that existed prior to.
HousingWire Reports on Bloodletting at NAR: The National Association of Realtors eliminated 41 positions and 20 open roles to "reduce costs, streamline operations and refocus on member services."
Fannie Mae’s ESR Group revised its existing home sales forecast upward: This follows downward tweaking of their mortgage rate predications by three-tenths of a percent for this year and next. The Economic & Strategic Research Group now says rates will finish 2025 at 6.3% and 2026 at 6.2%, while also predicting home sales will reach 4.95 million in this year - up slightly from 4.90 million previously.
The Consumer Policy Center apparently thinks U.S. consumers are idiots. The D.C.-based think tank released a report titled, “How Percentage-Based Commissions Can Harm Home Buyers and Sellers and What They Can Do About It”, claiming the fact that "agent compensation is expressed in percentages not dollars leads many home sellers and buyers to underestimate the real dollar cost of commissions." Sample conclusions from their release:
"Some people have a limited understanding of percentages.”
“People tend to underestimate prices expressed as small percentages."
Idaho Ahead of Feds (NMN): The Gem State’s governor signed a law requiring transparency with regard to “trigger leads,” as action to ban their usage is discussed on a national level.
CoreLogic Becomes Cotality: The company says their new name, logo, and brand identity reflects its transformation into an information services provider that is creating a faster, smarter, and more people-centric property industry. Snips from the release: Cotality, reflects the company’s deep commitment to collaboration and connectivity… the approach of totality…company spirit of vitality.
Frightening Fraud Allegation - NMN
A Pennsylvania-based couple is suing Newrez's servicing arm, Shellpoint Mortgage Servicing, for OK'ing a fraudulent $500,000 home equity line of credit wire transfer. Plaintiffs assert this demonstrates that Shellpoint does not have "any commercially reasonable security systems in place to prevent fraudulent wire transfers."
MOVING & SHAKING
Dark Matter announced that CRO Sean Dugan will succeed Rich Gagliano as CEO. Gagliano will become executive chairman.
Primis Mortgage welcomed Pete Zaft and his team.
SitusAMC appointed Daniel DeMonte as Sr. Director of Sales.
MARKET/INDUSTRY
The 30-year fixed-rate mortgage ticked down by two basis points this week: Freddie 3-27-25.
Mortgage Applications Decreased 2.0% From One Week Earlier: MBA Weekly Survey for the week ending 3-21-25.
What to make of recent developments? The core PCE came in higher than expected, but pausing of quantitative tightening is on the horizon. Bill Bodnar reads the tea leaves in his latest Master the Markets segment.
Homebuyer affordability flat in February: The national median payment applied for by purchase applicants remaining unchanged at $2,205 in February, according to the MBA’s Purchase Applications Payment Index (PAPI), which measures how new monthly mortgage payments vary across time – relative to income.
SLUGGISH SIGNINGS: NAR February Pending Home Sales
Pending home sales in February were up 2.0%.
Compared to one month ago, pending home sales declined in the Northeast and West, while the Midwest – and especially the South – increased.
YoY, contract signings declined in all four U.S. regions, with the Midwest showing the biggest decline.
"Despite the modest monthly increase, contract signings remain well below normal historical levels. A meaningful decline in mortgage rates would help both demand and supply – demand by boosting affordability, and supply by lessening the power of the mortgage rate lock-in effect. Considering the Federal Reserve's recent forecast for slower economic growth, we expect mortgage rates to slide moderately lower. But the current high national debt will prevent mortgage rates from falling drastically – and certainly not to the 4%-to-5% range seen during President Trump's first term." – NAR Chief Econ Lawrence Yun
Cost Crunch: ATTOM Data Q125 U.S. Home Affordability Report
Median-priced homes remain unaffordable in 97% of U.S. counties analyzed, continuing a three-year trend of high housing costs.
Major homeownership expenses now consume 32% of the average national wage – above the preferred 28% lending guideline.
The national median home price dipped slightly to $351,000 this quarter, but remains up 5.2% year-over-year.
Prices outpaced wage growth in 46.9% of counties analyzed.
The income needed to afford a median-priced home is now 16% higher than the U.S. median wage.
Flipping Fortune: 2024 EoY Flipping Report from ATTOM Data
2024 had a modest uptick in profits and profit margins on typical buy-renovate-resell projects. However, margins still hovered near their lowest levels of the past decade, as investors continued to face challenges capitalizing on the broader housing market boom.
The average gross profit on a typical home flip across the U.S. rose to $72,000—calculated as the difference between the median resale price and the original purchase price paid by investors.
That marks an increase from $67,846 in 2023 and represents a 29.6% return on investment based on the initial acquisition cost.
Appetite for Education: More From the NeighborWorks Survey
The survey found that housing counseling could be a game changer, noting that a strong majority of renters say they would benefit from help:
64% want down payment assistance
62% want education on mortgage options
58% want access to first-time homebuyer programs
Over half also see value in financial coaching and connecting with current homeowners