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The Slow Roll of Rates
By Jeff Walton & Kelly Guest
Table of Contents
CHATTER
loanDepot Gets Blingy Stock Jump After Being Called a Gem (NMP)
Citron Research released a report asserting that "the company’s servicing portfolio alone is worth more than double the stock’s current price," and called loanDepot "The Hidden Gem of Housing Finance," causing LDI shares to surge approximately 33%.
Pennymac Adopts, Invests in Vesta LOS
The company is the first large mortgage client to go live on Vesta’s platform, marking a significant industry milestone. As part of this venture, Pennymac has made a long-term minority equity investment in Vesta.
HUD Action Against Equity Prime Mortgage: The agency terminated EPM's ability to independently underwrite FHA loans in New York, Orlando, Louisville, and Jacksonville.
LitFinancial announced the official launch of litUSD, a U.S. dollar-backed stablecoin, in partnership with Brale, a stablecoin-as-a-service platform, and Stably, a stablecoin advisory firm. Built on the Ethereum blockchain, litUSD is designed to modernize traditional lending models, streamline treasury operations, and increase transparency across mortgage finance.
Figure Technology Solutions raised $787.5M in its IPO last week. The company sold 31.5M shares priced at $25, above the expected range of $20 to $22. At the IPO price, Figure's valuation was stamped at $5.3B.The stock opened at $36 in early afternoon trading last Thursday, up about 44%.
Ohio Joins FL & Others in Musing Property Tax Elimination (HW)
Credit Pots Calling the Kettle Black?
From the American Enterprise Institute (AEI) report on FICO vs. VantageScore:
VantageScore is owned by the big 3 credit bureaus: Experian, Equifax, TransUnion
VantageScore claims it will reduce costs for consumers, but the numbers tell a different story. A typical tri-merge credit report costs $80–$100, paid to a reseller. To create it, the reseller purchases credit files from each of the three repositories at $13–$25 apiece. Each repository then pays FICO roughly $5 in royalties — about $15 total. In the context of thousands of dollars in closing costs, FICO’s share is marginal at best.
The truth is while FICO has long been the sole provider of an accepted mortgage credit score, the three credit repositories — which jointly own VantageScore — are also the exclusive sellers of the underlying credit data. Replacing FICO with their own model doesn’t necessarily lower costs for consumers — it simply allows them to capture a bigger slice of the pie.
What are Lessors Doing Less of?
TransUnion Says More Renters but Fewer Prop Mgrs Reporting Rent Payments
The number of renters electing to report their payments rose 2% YoY this year
TransUnion’s research also found the number of property managers who are aware of and participate in rent payment reporting decreased to 44% in 2025, down from 48% the year prior. This is first year in 4 to find a decrease in property managers indicating they report rent payments. That number was 27% in 2022 and rose annually until hitting 48% in 2024.
The sudden decrease in property managers’ participation and the slight rise in consumers who say their payments are reported suggests that consumers may be self-reporting their rent payments through third-party data furnishers.
MARKET/INDUSTRY
Same Movie, Better Ending? Mortgage rates have been improving and we know the Fed rate cuts are coming, but how many will we get yet this year? Bill Bodnar breaks it down in his latest Master the Markets segment!
Mortgage Rates Drop: Freddie 9-11-25
The 30-year fixed-rate mortgage fell 15 basis points from last week, the largest weekly drop in the past year. Mortgage rates are headed in the right direction and homebuyers have noticed, as purchase applications reached the highest year-over-year growth rate in more than four years.
Mortgage applications increased 9.2% from one week earlier: MBA Weekly Survey for the week ending 9-5-25.
More Mortgage Credit: MBA Mortgage Credit Availability Index (MCAI)
The MCAI rose by 0.1% to 104.0 in August. 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 0.3%, while the Government MCAI decreased by 0.1%. Of the component indices of the Conventional MCAI, the Jumbo MCAI remained unchanged, and the Conforming MCAI rose by 0.7%.
ATTOM Data's 8-25 U.S. Foreclosure Market Report
August marked the 6th consecutive month of YoY increases and the 3rd straight month of double-digit annual growth.
Filings remain below pre-pandemic levels; however, the steady rise in foreclosure starts and completions suggests mounting financial strain for some homeowners.
Foreclosure filings were down 1% MoM, but up 18% YoY.
Foreclosure starts were nearly flat MoM, but up 17% YoY led by TX, FL, and CA.
Completed foreclosures rose 5% MoM and 41% YoY.
Record High for Non-QM
Non-QM share of business was up from 5.6% a year ago and just 1.4% in August 2020, extending its steady growth trend
Non-QM hits record: Non-QM share rose to 8.34% of all originations in August, up from 8.03% in July and setting a new record high.
Conforming declines: Conforming share fell 123 bps to 51%.
VA loans gained 78 bps to 12.1%, non-conforming increased 48 bps to 17.3%, FHA edged up 1 bp to 19% and USDA dipped 5 bps to 0.7%.
INSANE INCREASE: A 70% Jump in 5 Years
Much Ado About Insurance: ICE September Mortgage Monitor
Property insurance costs continued to press higher over the first half of 2025, with the average insurance payment on mortgaged single-family homes rising by 4.9% over the first half of 2025.
That’s lower than the 7.3% gain in the first six months of 2024, but it pushes property insurance costs in the U.S. to yet another record high, climbing by 11.3% ($20 a month) from the same time last year.
The average single-family mortgage holder now pays nearly $2,370 a year for property insurance, which accounts for a record 9.6% of average mortgage-related expenses when factoring principal, interest, taxes, and insurance.
The cost per $1,000 of property insurance rose by $0.29 (5%) from the same time last year and $0.85 (+16%) since 2022, confirming that it’s not just rising home prices, but also the rising cost of insurance coverage impacting homeowners across the U.S.
While interest payments are also rising (+8% YoY), property insurance was once again the fastest-growing subcomponent of mortgage payments (+11% YoY), significantly outpacing principal payments (+1% YoY) and property taxes (+5% YoY).
The average property insurance payment has now risen by nearly 70% over the past 5.5 years, more than double the increase for principal (+23%), interest (+27%), and taxes (+27%).
Equity Extraction – Growing, but Historically Low
Homeowners withdrew $52B in equity via second-lien HEL products and cash-out refinances in Q2 marking the largest single quarter of equity extraction in nearly three years.
$28.6B in equity extraction came from second liens, marking the largest quarterly volume since Q3 2022 ‒ within 8% of the 17-year high in 2022.
Another $23.2B was withdrawn via cash-out refinances, which was also the highest quarterly total since Q3 2022.
Borrowers withdrew 0.45% of tappable equity available at the start of the quarter, up from 0.41% in Q1, the highest overall equity extraction rate since late 2022.
While equity extraction edged higher in the quarter, that rate remains roughly half of its normal level, as elevated interest rates continue to dampen borrowing activity.
The second-lien extraction rate continues to run ~20% below its long-run average, while cash-out extraction is running at roughly a third of its long run average.
More Buyers Ready to Go than Not…
HW Reports on Tomo Mortgage Survey
46% of potential buyers waiting 3 mos to 1yr+
54% ready to go between now and 3 mos
From the story: The survey of more than 1,000 buyers, released this week by Tomo Mortgage, highlights the gap between economic reality and consumer sentiment in the housing market.
Nearly one in three respondents to the survey said high mortgage rates are the nation’s biggest economic problem, and three-quarters said current rates are abnormally high, despite being lower than historic norms.