In addition to this week’s holiday closure (early close Wednesday, fully closed Thursday),  the econ calendar is also lacking in terms of potential sources of volatility. A majority of any meaningful momentum is most likely to come from month/quarter/year-end trading today and tomorrow, but think of that more like a caveat for any incidental movement rather than a prediction. Monday is off to an OK start with modest overnight gains driven by rally in EU bonds after their return from holiday. Treasuries gladly followed in the illiquid overnight hours, but have been less willing to do so now that the domestic session is underway.

Some percentage of readers reading today’s Commentary are doing so from an airport in the Northeast, waiting for their delayed flight to depart. Whether manmade or natural, climate change and weather “occurrences” are a fact of life, and can’t be corrected with technology, but data is certainly used in predicting weather. Vendors and lenders think about data collection versus data verification versus data analysis. Is your organization doing all three, two, one, or none? (Technology: just because you can do something doesn’t mean that you should… Tired of sliding your finger over a screen, especially in a car? Here’s some welcome news.) Lenders try to use technology to combat fraud, with mixed results. CrossCountry has made headlines by seeking $2.1 million from Christopher J. Gallo who is battling 18 federal charges. (Unsubstantiated chatter has Gallo and his team allegedly focusing on DSCR loans and originating $1.4 billion of allegedly fraudulent loans.) “Don’t do the crime if you can’t do the time” … more below. (Today’s podcast can be found here and this week’s are sponsored by the Refi Recapture Engine from LO Autopilot. Did you know lenders lose 80 percent of refi recapture? The Refi Recapture Engine triples recapture volume and delivers refi-ready borrowers to your LOs on a silver platter. They’re so confident in the ROI they let you try before you buy. Contact them for a demo. Hear an interview with marketer Bri Lees on statistics and findings from an audit on the Chrisman Commentary reach and distribution, which is a must-listen for advertising partners.)

Home prices rose 0.2% nationally month-over-month in November, but there were an estimated 37.2% more sellers than buyers in the market, Redfin said.

Rialto Capital allegedly engineered a way to keep it in default so that the company could win extra fees over time, according to a lawsuit filed Tuesday.

Patrick Terrance Donlon, CEO of Trusted American Mortgage, settled allegations from 21 states another person took industry education courses for him.

Lender and Broker Services, Products, and Software In an open letter reflecting on a landmark 2025, Polly Founder and CEO Adam Carmel shares a powerful message of gratitude and strategic evolution. The company has spent the past year leading the market in enterprise innovation and Generative AI, continuing to demonstrate that the era of stagnant, legacy tech is over. This is more than a milestone report; it’s a call to action for an industry at a crossroads. Carmel reflects on the profound impact and shared success achieved alongside Polly’s customer partners, and looks ahead to a 2026 centered on intentional innovation and new product frontiers. Whether you’re a long-time partner or industry observer, this letter offers a transparent look at the future of capital markets technology. Read the full open letter to explore Polly’s 2025 milestones and their bold vision for the year ahead. 52 percent of non-QM securitized loans are DSCR. Is your process keeping up? With Asurity’s Propel™, lenders generate complete DSCR loan packages in minutes: fast, compliant, and scalable. Propel handles DSCR-specific fields, calculations, and disclosures while staying aligned with changing state regulations, so your team can close more deals without adding operational complexity. Built on deep regulatory expertise, Propel helps lenders accelerate approvals, stay compliant, and win more investor business. Get the DSCR solution sheet. “As 2025 comes to a close, eRESI would like to extend our sincere appreciation to our sellers, partners, and employees for an incredible year of growth. Together, we surpassed major milestones, including purchasing over $16 billion in loans. We became the first major non-QM Investor to integrate with Encompass Investor Connect and the exclusive non-QM Investor on the Chrisman Marketplace. Building on this momentum, we’re more committed than ever to helping lenders gain the EDGE to succeed in 2026, with ongoing support from our product, credit, and pricing teams, plus sharpened strategy tools and new marketing-driven growth sessions with our sellers. eRESI is here to help you capture non-QM market share as the housing landscape evolves. We’re your EDGE today and tomorrow. Contact us.”

Because mortgage rates are determined by the bond market, a boring market day typically translates to a boring mortgage rate day. But that’s not entirely true today. While the level of movement is indeed very small, it only took a small movement to get the average 30yr fixed rate down to their lowest levels since the end of October.   Next week should be another slow one for rates, but things should pick up progressively as 2026 gets underway.

Bonds End Unchanged After Another Quiet Session

This is essentially placeholder commentary to serve as Friday’s recap even though no commentary is needed this week.  Bonds saw some incidental strength in the AM and weakness heading into the PM. The net effect was unchanged trading levels by the 3pm CME close. 

Market Movement Recap

10:31 AM modestly stronger overnight and sideways so far.  MBS up 3 ticks (.09) and 10yr down 1.2bps at 4.12

12:27 PM Off the best levels. MBS now unchanged and 10yr up 1bps at 4.142

02:31 PM Holding sideways with no additional weakness.  MBS unchanged and 10yr up less than 1bp at 4.138

Although the bond market is technically open today, it might as well not be. Late year holidays (Thanksgiving, X-mas, New Year) depress volume and liquidity more than any others. Today is neither an official holiday nor an early close day, but considering Christmas fell on a Thursday and the federal employee holiday, trading is just as sparse as it was on Christmas Eve. Algorithmic trading programs are doing the vast majority of market making (i.e. determining prevailing levels for buyers and sellers). Bonds will remain sideways in a very narrow range until non-algo trades force a modest move higher or lower. At that point, yields can make a short run in the direction implied by those trades before leveling off in a sideways pattern to wait for the next legit input. If you prefer, you can disregard all of the above and simply understand that the next “real” trading in the bond market won’t happen until the week of January 5th. 

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