We were close yesterday and we officially arrived today. Mortgage rates may still be elevated compared to almost all of the past 10 months, but they’re the lowest they’ve been since May 14th.  This was accomplished with a modest drop versus yesterday’s levels after another round of news on a potential U.S./Iran peace deal. This morning’s inflation data also helped the underlying bond market find its footing. In terms of nuts and bolts, top tier 30yr fixed rates fell to 6.59% for the average lender, down from 6.61% yesterday and from 6.75% last Tuesday. [thirtyyearmortgagerates]

What is something that small and mid-sized lenders can’t offer? Chase rolled out a program for borrowers to earn 100,000 Chase Points. (Bilt and UWM rolled out something similar a while back.) But, nearly every lender can help borrowers with the cost of a mortgage, and STRATMOR’s current blog is “Pricing That Can Help Borrowers.” In addition, in the credit world two new automated features for the FICO Score Mortgage Simulator were announced yesterday designed to help lenders move beyond manual “what-if” credit simulations and generate personalized borrower action plans more efficiently. The program “automates credit action planning for borrowers based on target score goals or budget, offers early score potential estimates, and is built directly on the mortgage FICO Scores used in lending decisions (FICO Scores 2, 4 and 5). (Today’s podcast can be found here and this week’s ‘casts are sponsored by NFTYDoor, the white-label HELOC platform for banks, credit unions, and brokers. Close in zero days with warehouse funding. Power your home equity lending with NFTYDoor. Today’s features an interview with Sagent’s Sridhar Sharma and Shane Leonard on how the latest and greatest in underwriting technology is reducing friction in the mortgage origination process.) Lender and Broker Products, Software, and Services “500 loans or 50,000. You get the same elite servicing platform. At MSF Servicing, no portfolio is too big or too small. That’s because we’ve eliminated the minimum loan count requirements that leave smaller servicers locked out of top-tier platforms. Whether you’re managing 500 loans or 50,000, you’ll have access to the same experienced team, the same state-of-the-art technology, and the same high-touch level of service, with no thresholds, no gatekeeping, and no compromises. Our servicing platform was purpose-built to scale without sacrificing quality. Boutique relationships and complex portfolios run on the same infrastructure that grows as you do. Finally, your borrowers will love the MSF mobile app, which delivers real-time account access, seamless payment tracking, and intuitive self-service, on their schedule. All backed by a dedicated borrower portal and multilingual support in 200+ languages that enhances your brand at every touchpoint. For more information, contact Rick Smith (860-989-9006).

There’s a supertanker load of data this morning with some apparently interesting results, but the market remains focused primarily on supertankers being able to transport oil. Those prospects were dealt a fresh blow overnight as both sides reported renewed attacks. Bond yields and oil prices jumped clearly in response, but not in an overly aggressive fashion. And to be fair to this morning’s data, it has actually been up to the task of helping yields drop about 2bps back to unchanged levels. Primary credit would have to go to lower than expected monthly PCE prices. Even though PCE is trending in the wrong direction, the monthly rate came in at 0.4 vs 0.5 forecasts and 0.7 previously.

Any time PCE comes out, there’s some buzz on the implications of earnings versus inflation. This time around, the temptation is to conclude that lower personal income cannot support inflation-adjusted spending. And while there’s no doubt that lower income inhibits spending that would otherwise be seen, longer term data and bigger-picture numbers suggest we shouldn’t count on it as some mythical inflation-fighting hero.

Housing advocates and compliance firms are suing to block a rule from the Consumer Financial Protection Bureau that they say guts the Equal Credit Opportunity Act.

June could be the true test for delinquencies and how many distressed borrowers impacted by a shift in Federal Housing Administration rules will reperform.

The Federal Reserve Board governor is the latest Fed official to embrace the prospect of tighter monetary policy in response to rapidly rising prices that have taken hold in recent years.

All-cash home purchases hit a six-year March low of 28.9%, as a buyer-friendly market reduced the need to use cash to stand out, with sellers outnumbering buyers by a record-near margin, Redfin found.

Property taxes are up 30% since 2019, driven by pandemic-era home value gains. Mortgage borrowers pay more than those without a loan, and experts say relief is unlikely anytime soon.

In a Shocking Twist, Bonds Relive Another Groundhog Day

The present week began on a stronger note thanks to news that came out on Monday regarding a U.S./Iran peace deal being within reach. This time around, it was the fact that Iran’s state TV shared a draft of the framework for the memo that serves as the stop-gap peace deal while full details are negotiated. It turns out that this draft wasn’t obviously different from the one referenced on Monday, but markets remain cautiously willing to react to the same repackaged news time and again as if repetition increases the chance that the peace deal will eventually become official. Bonds were a bit more skeptical than oil prices, but ultimately ended the day without losing any ground.

Market Movement Recap

08:27 AM modest overnight gains and some extra buying just now after yet another round of peace deal headlines. MBS up 3 ticks (.09) and 10yr down 3bps at 4.459

10:49 AM sideways volatility. MBS up 3 ticks (.09) and 10yr down 1.5bps at 4.472

Early in the trading session, the bond market began improving in response to more updates on a potential Iran peace deal. When bonds improve, rates fall, but the initial reaction proved short-lived.  Thankfully, the reversal didn’t do any new damage. This allowed the average lender to keep rates right in line with yesterday’s 6.61% for a top-tier 30 year fixed. You’d have to go back to May 14th to see anything lower.