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What the Fed’s Moves Mean for Mortgages, Credit Cards and More

Higher rates benefit those who can save, but for borrowers falling rates would reduce bills on credit cards, home equity loans and other forms of debt.

The average 30-year mortgage rate was 6.74 percent as of March 14.Credit…Amanda Lucier for The New York Times

  • May 1, 2024

American households who were hoping interest rates would soon decline will have to wait a bit longer.

The Federal Reserve kept its benchmark interest rate unchanged on Wednesday, noting that progress on cooling inflation had stalled.

The central bank has raised its key interest rate to 5.33 percent from near zero in a series of increases between March 2022 and last summer, and they’ve remained unchanged since then. The goal was to tamp down inflation, which has cooled considerably, but is still higher than the Fed would like, suggesting that interest rates could remain high for longer than previously expected.

For people with money stashed away in higher-yielding savings accounts, a continuation of elevated rates translates into more interest earnings. But for people saddled with high cost credit card debt, or aspiring homeowners who have been sidelined by higher interest rates, a lower-rate environment can’t come soon enough.

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Source: nytimes.com

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It’s the fifth-largest retailer in the country and it’s already doing at least $6 billion in home furnishings, but if Home Depot ever gets really serious about the category, it could change absolutely everything in the market. And that may be coming sooner than many people realize.

Early next month, Home Depot will run its second Decor Days online promotional event, and it may be just a taste of how the home improvement giant is planning to expand its business in this category. With the remodeling and DIY segments slowing as the housing market continues to stall, home decor represents perhaps its greatest area of potential growth after the professional builder and contractor sector. (The company is already targeting the latter with both organic and external moves.)

Right now, home decor—at least, as Home Depot narrowly defines it (decor plus storage)—represents only about 4 percent of the company’s $152 billion a year in annual revenue, or about $6 billion. However, a broader interpretation of the category that includes flooring and appliances takes that figure up to around 19 percent, or about $29 billion. And by the brand’s broader-still delineation of its business, it says “decor”—which one can assume also includes lighting, some gardening, and kitchen and bath products—represents almost one-third of its overall annual revenue, clocking in at about $50 billion. (All numbers are based on the company’s 2023 fiscal year.)

As the home furnishings industry tends to define “decor” (furniture, home textiles, housewares, rugs, and decorating merchandise like wallpaper), very little is actually found in Home Depot stores. There are rugs, carpeting, wallcoverings and a selection of window treatments, but not much more. The rest of these merchandising categories are sold online, where the offerings are extensive, including cookware, small appliances, furniture and tabletop.

That’s why Decor Days, set for May 2 to 6—a shopping period leading up to Mother’s Day—is an online-only event. Following the more limited debut of this promo last October, the second iteration has expanded to feature furniture, mattresses, lighting, rugs, wall art and kitchen tools, said the company in a release. The product selection will include brands such as KitchenAid, Tempur-Pedic and Ember, as well Home Depot’s private labels, Home Decorators Collection and StyleWell.

For Home Depot, this is the latest step in its on-again, off-again romance with home furnishings. In 1991, it launched its Expo Design Center concept, an upscale, broad-based big-box store that emphasized solutions for full kitchen and bathroom projects, as well as furnishings and decorating products. The brand eventually built the business up to more than 50 locations and at one time talked about operating as many as 200. But it never got there—and while the company didn’t break out the sales of this nameplate, one can assume the gradual store closings signaled it wasn’t successful. Finally, in 2009, it shuttered the last of the 34 still in operation and walked away from the concept.

The company also dabbled with another spinoff, Floor Store, which was launched in 2000 and grew to seven locations and a call center, primarily in Texas. Again, the brand said the concept wasn’t performing as well as it had hoped before it shut down seven years later. Both of these divisions, it should be noted, were dissolved during the period of the 2008 housing crisis, when Home Depot’s overall business was severely challenged.

In 2017, Home Depot purchased The Company Store, an online retailer of primarily home textiles and soft furnishings, and it appeared to be a step closer to building out that business within its overall operation. The subsidiary continues to operate both as a stand-alone brand and on the Home Depot website, but has not been positioned as a critical part of the decor mix.

Home Depot’s archrival, Lowe’s, is also targeting the home decor segment, though it doesn’t break out its revenues specifically for the category. Lowe’s likely does more in-store decorating business than its competitor, as its customer base skews a little more toward female shoppers. Recently it, too, launched private-label furnishings and decor brands, also with larger assortments offered online.

Now that Home Depot is generally quite sound financially, in spite of a post-pandemic industry-wide slump, it is substantially expanding its pro builder business by buying up other suppliers as well as adding dedicated distribution centers (Lowe’s has a similar strategy). The company says that even though pro builders represent only 10 percent of its customer count, they generate about half of its overall annual revenue.

So, where does that leave decor? Far behind—but still potentially Home Depot’s next big driver of growth.

____________

Warren Shoulberg is the former editor in chief for several leading B2B publications. He has been a guest lecturer at the Columbia University Graduate School of Business; received honors from the International Furnishings and Design Association and the Fashion Institute of Technology; and been cited by The Wall Street Journal, The New York Times, The Washington Post, CNN and other media as a leading industry expert. His Retail Watch columns offer deep industry insights on major markets and product categories.

Source: businessofhome.com

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Prime Video had a treat in store for fans of author Karen Kingsbury’s work.

It dropped all three seasons of its American faith-based family drama television series, The Baxters on March 28, giving us an extended first look at the lives of the Baxter family — and their vision board-worthy family home, which sets the stage for the drama to unfold from the very first shot.

Based on the bestselling novels by Karen Kingsbury — crowned the Queen of Christian Fiction by The New York Times — the show stars Roma Downey and Ted McGinley as Elizabeth and John Baxter, who navigate the complexities of life with their five adult children.

And since the Baxter family’s home is a key element in grounding the emotional depth of the series, we reached out to the production crew to learn more about how it was brought to life on screen.

The house is a memorable silent character from the very first episode

Although the first season focuses primarily on Kari’s (Ali Cobrin) story, the Baxters’ house takes center stage from the very first scene, when the family converges to celebrate mother Elizabeth Baxter’s (played by Roma Downey) birthday.

Photo credit: Prime Video / Joshua Applegate

The Baxter residence shines from its very first moment in the spotlight. And that’s not by accident.

Production designer Rodrigo Cabral envisioned a home that mirrors John and Elizabeth’s loving, nurturing nature.

“We wanted their home to radiate warmth and tranquility—a safe haven for the family to gather, heal, and grow,” Cabral tells us.

This vision translated into cozy interiors, balanced spaces, and a decor that promotes comfort and family togetherness, making the house a cornerstone of the show’s narrative.

Design inspirations behind the scenes

The design of the Baxter home reflects the broader experiences of American families, aiming to echo their quest for happiness and balance.

Photo credit: Prime Video / Joshua Applegate

“The Baxter family is a close representation of so many American families, not only in their interiors but also in their pursuit of happiness and balance,” Rodrigo Cabral shares with Fancy Pants Homes.

“We got inspired by the experiences with real families that have been part of our lives. I had some great chats with the showrunner, directors, and crew about each character’s vibe and inner world, which really helped shape our vision.”

Cabral notes that the set design was influenced by discussions about each character’s inner world and successful elements from other family dramas like This is Us. “Our goal was to create a setting that feels real and informative, yet allows the characters’ stories to unfold naturally,” he explains.

Style elements that define the interiors

When asked about the decor of the Baxters house, Cabral shares that “John and Elizabeth’s house has a traditional decor style that’s classic, warm, comforting and familiar. We used neutral tones, some warm pattern fabrics with traditional antique furniture and a lot of details like plenty of family photos to show their history and connection throughout the years.”

No attention to detail was spared in creating the sets, and special attention was given to elements that reflect the lives, beliefs, and faith of its inhabitants.

Photo credit: Prime Video / Joshua Applegate

“Some of the antique pieces help reinforce their traditional values by invoking the idea of family history and its importance like little family heirlooms in the background. And these elements are carried around throughout the rest of the house and a bit to Kari’s interior as well.”

A real home in Brentwood was used to film shots of the Baxters’ house

Underscoring the show’s commitment to authenticity, a real house in the family-friendly Los Angeles suburb of Brentwood served as filming location for The Baxters house.

Set in the San Fernando Valley area of LA, Brentwood is known for its family-friendly atmosphere and has hosted other iconic television homes, including Jay and Gloria’s house on Modern Family and the now-iconic Banks mansion from The Fresh Prince of Bel Air.

This suburb is often chosen for its portrayal of upscale American family life.

Photo credit: Amazon MGM Studios

Key scenes

The Baxter home provides a poignant backdrop for several key family moments. Vibrant Thanksgiving gatherings, reflective Christmas celebrations, and personal crises like Luke’s struggle with faith all take place within this family home.

With three seasons now out — and a fourth one hopefully soon to follow — we’re looking forward to seeing more heartwarming and challenging moments unfold in the loving confines of the Baxter household.

Photo credit: Amazon MGM Studios

More stories

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A closer look at Booth and Brennan’s two perfect family homes on ‘Bones’

Where is the house from Firefly Lane? Tracking down Kate’s waterfront mansion and Tully’s posh penthouse

Source: fancypantshomes.com

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Even homeowners who have paid off their mortgage may be finding that their available equity is not enough to downsize, according to a story published Saturday by The New York Times. The article also notes that reverse mortgages are a potentially valuable tool for seniors in the current housing environment.

Roughly 80% of older adults live in the homes they own, but housing costs and interest rates have combined to create a challenging scenario for some older people seeking to downsize into a more manageable home. The prices for smaller townhouses or condominiums can, in some cases, outweigh the prices for larger single-family homes.

“[T]he traditional notion that a house with a paid-off mortgage can serve as an A.T.M. to help fund retirement living is shifting, economists report. Homeownership no longer is an unqualified benefit for some seniors,” the story explained.

Urban Institute research economist Linna Zhu rhetorically asked if seniors were “aging in place, or stuck in place.” 

According to data from Harvard University’s Joint Center for Housing Studies (JCHS), the share of older adults carrying mortgage debt rose significantly between 1989 and 2022, going from 24% to 41%. During that same period, the typical amount owed on these mortgages rose from $21,000 to $110,000.

These larger mortgage balances, combined with elevated interest rates, have made impacted seniors “cost-burdened,” according to 2023 data from the JCHS, meaning they spend at least 30% of their income on housing costs.

But with rising home prices have also come higher levels of home equity, which recently led Boston College’s Center for Retirement Research (CRR) to reduce “its estimate of the proportion of American households at risk of being unable to maintain their standard of living after retirement,” the Times reported.

The CRR’s so-called “retirement risk index” fell to 39% in 2022, down from 47% in 2019. The organization “bases its calculations on older homeowners tapping their home equity with reverse mortgages,” the Times explained.

A profiled couple obtained a Home Equity Conversion Mortgage (HECM) sponsored by the Federal Housing Administration (FHA) in 2020, which allowed them to “pay off their existing mortgage, afford cataract surgery and complicated dentistry (neither one was covered by Medicare, in this instance), replace a 22-year-old car and upgrade their plumbing, all while keeping their retirement savings intact,” the Times stated.

Zhu of the Urban Institute told the Times that reverse mortgages are “a very effective way to tap home equity,” but product adoption by seniors — as is true with many equity-tapping options — remains low.

Housing researcher Jennifer Molinsky noted that home equity is seen as “a nest egg” for those in later life, but many seniors are hesitant to tap it as a financial resource. Instead, many seniors see it as more of an emergency resource, only to be tapped when no other options exist.

“Besides, accessing home equity isn’t always simple or possible,” the Times stated. “With federally insured reverse mortgages — officially [HECMs] — the upfront costs are high […] and the paperwork substantial. In 2022, only 64,500 older applicants received reverse mortgages through the federal program.”

One researcher said that the situations of older adults could be bettered by “improving and streamlining the federal HECM program, broadening the criteria for refinancing and [home equity line of credit (HELOC)] loans, and encouraging the development of more housing, including homes and apartments suitable for older buyers and tenants.”

Source: housingwire.com

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MSR Execution, VOI, Post-Closing Audit, Client Acquisition Tools; May Training and Events

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MSR Execution, VOI, Post-Closing Audit, Client Acquisition Tools; May Training and Events

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Thu, Apr 18 2024, 11:12 AM

What loan officer hasn’t had a memorable co-signing experience? Some more so than others. Along those lines, if you head to Disneyland or Disneyworld, and find bone chips or ashes on the floor of your favorite ride, it is probably not an accident. Nor is eking out a gain, or at least breaking even, in residential lending an accident. At the Great River Conference in Memphis, much of the information being presented is about how to do things more efficiently. And for good reason, as the MBA’s calculations for IMBs and mortgage subsidiaries of chartered banks last showed that total loan production expenses (commissions, compensation, occupancy, equipment, and other production expenses and corporate allocations) increased to $12,485 per loan in the fourth quarter. On the income side of things, borrowers who obtained adjustable-rate mortgage loans (ARMs, for lack of a better acronym) 3 or 5 or 7 years ago have popped up on LO screens for refinances, and you can bet that the companies who own that servicing are all over those borrowers “like hounds on a meat wagon.” (Found here, this week’s podcasts are sponsored by Optimal Blue. OB’s smart solutions automate critical functions like pricing, hedging, trading, and social media. More originators and investors rely upon Optimal Blue’s integrated solutions, data, and connections to support their unique business strategies, no matter how complex. Hear an interview with Optimal Blue’s Mike Vough on refining margin management to improve loan profitability and reduce risk.)

Lender and Broker Products, Software, and Services

For many non-QM lenders, real estate investors make up nearly half of their pipeline. Despite stubbornly high interest rates and low inventory, these borrowers continue to transact in this market, opening up an opportunity for lenders to capture this business. However, capturing this business with traditional marketing and sales efforts is not easy. Unless you have Privy. With Privy, you can now automate real estate investor and borrower acquisition and retention. With just a click of a button, borrowers are able to engage with you at any stage of the transaction process, from just browsing to ready to transact. Let effective technology help drive your DSCR, asset depletion, and fix and flip loan volume. Contact Brad Bieber (803-730-5032) to learn more about Privy’s Enterprise Solutions.

A 30-minute meeting with Planet Home Lending’s Correspondent sales team at the MBA Secondary & Capital Markets Conference could be the catalyst for a year-round boost in your business. Join us in the Gotham III Ballroom at the InterContinental New York Times Square. Don’t wait: secure your spot now before they’re all booked! Get in touch with your Regional Sales Manager or SVP Correspondent Sales, Jim Loving (414-270-0027) to explore our continually refined product lineup spanning vanilla to niche products all tailored to your unique needs: Best effort, mandatory AOT, delegated, or non-delegated.

“Regional Credit Union Attributes Successful Audit Process to QC Ally Partnership! In a world where integrity is everything, QC Ally prides itself on building a foundation of trust with each client partner. Recently, we sat down with Bill James, Chief Risk Officer at Marine Credit Union, to discuss how QC Ally helped them achieve a formalized, unbiased pre-fund and post-close audit process with custom loan sampling. As Bill put it, ‘We’ve been very happy with QC Ally. We stacked QC Ally up against very strong competition, and they really won hands down. The service levels you provide and your own staff with very deep, rich experience are unmatched.’ Learn more here.”

As certain wines age, their tannins bind together in a process called polymerization, creating a smoother, rounder flavor that’s more desirable, and, often, more valuable, than when first vinted. Are your mortgage technology partners improving like fine wine? That’s been the experience of Lake Michigan Credit Union, which just shared new success metrics regarding its use of income and employment verification from Argyle. It’s been about a year since LMCU switched to Argyle for VOIE, and the credit union can now quantify its time and cost savings at a whopping 3 weeks and $100 per closed loan. Read the updated case study findings here.

Mortgage Capital Trading, the de facto leader in innovative mortgage capital markets technology, introduces a game-changing best execution technology for MSR retain and release decisions all in one platform. With this groundbreaking development, MCT’s Enhanced Best Execution (EBX) solution emerges as a real-time bridge between MCTlive! (live whole loan/SRP execution) and MSRlive! (loan level MSR valuation), revolutionizing the landscape of best execution strategies in the mortgage industry. MCT clients now have accurate insight into how loans are trading and what investors are paying along with the intrinsic servicing value to enhance the retained vs. released decisioning process. What was once a manual, time-consuming exercise is now completely automated with EBX, making all of the essential execution data elements accessible with the click of a button. Read the latest press release or join MCT’s upcoming webinar to learn more about their latest innovation.

Events and Training

A good place for longer term conference planning is to start is here, and click on “Conference List” for in-person events in the future. Yes, there’s plenty ahead in April, but I thought for travel planning purposes it would be to glance ahead to May as vendors and lenders take a critical look at travel & entertainment budgets.

National MI University’s May Webinars: Leading With Style ​​with Andrew Oxley – May 7th at 2pm ET. Income Analysis for Conventional Loans with Marianne Collins – May 9th at 1pm ET.

How to Make Accountability Cool and KPIs Fun Again ​​​​​with Dr. Bruce Lund – May 14th at 2pm ET. Screen Savvy: Mastering Virtual Influence for Lenders with Julie Hansen – May 15th at 2pm ET. Understanding the Personalities of Your Clients and Partners ​​​​​with Rebecca Lorenz – May 16th at 1pm ET. Your Event Playbook to Network and Form Referral Partnerships with Kendra Lee – May 21st at 1pm ET.

Great things are happening around the 2024 Fair Lending Forum, April 29 – May 1 in Charlotte, NC! Asurity is thrilled to announce that Josh Stein, North Carolina Attorney General, will be joining us! He will share his perspectives on fair lending during a fireside chat with our Founder and CEO, Andy Sandler titled The Role of State Attorney Generals in Fair Lending Enforcement. Other prominent speakers are Bob Broeksmit, President and CEO of MBA; Lindsey Johnson, President and CEO of CBA: Grovetta Gardineer, Sr. Deputy Comptroller for Bank Supervision Policy, OCC; Ben Olson, Senior Associate Director for Consumer Protection & Supervision, FRB; Varda Hussain, Principal Deputy Chief for Fair Lending in the Civil Rights Division, Housing and Civil Enforcement Section, DOJ; and Frank Vespa-Papaleo, Principal Deputy Director of Fair Lending, CFPB. Register at www.fairlendingforum.com.

If you’re in Minnesota on May 1st, 10:00am – 12:00pm and a Loan Originator, are you interested in creating and building strong realtor relationships? If so, register and attend the “Mastering the Realtor Referral Relationship” presented by Steven Ross, Author of Doors Open When You Knock.

Join Northern Michigan Luncheon, Tuesday, May 2, 11:30 AM – 1:00 PM at Silver Spruce Brewing Company, to hear from a panel of VA Loan Experts and they dive into the specifics of this loan type, any changes that are coming on VA loans and much more. They’ll also be discussing the pending NAR settlement, and what changes that brings to VA loans, sales, and associated realtor fees.

Don’t miss this opportunity to connect with industry peers, gain valuable insights, and elevate your mortgage business. Attend the MMBBA Annual Conference on Thursday, May 2, 10 a.m. to 4 p.m. in Queenstown.

The Maryland Mortgage Bankers and Brokers Association Annual Conference is scheduled for Thursday, May 2, 10 a.m. to 4 p.m. in the picturesque setting of Queenstown, MD. Featuring speaker, Edward Seiler, PhD, Executive Director of the Research Institute for Housing America and Associate VP of Housing Economics at the Mortgage Bankers Association. Edward will provide invaluable insights into the housing market and economic trends.

This year’s OMBA Annual Convention will delve deep into the dynamics of the mortgage industry and explore the current market trends. Whether you’re a seasoned professional or just stepping into the mortgage world, this event on Monday, May 6 – Tuesday, May 7 promises valuable insights to navigate the industry’s landscape.

The AEI Housing Center will host five convenings in the week of May 6 in Denver, Colorado; San Francisco, California; Los Angeles, California; Orange County, California; and San Diego, California. These convenings will share insights on using light-touch density (LTD), also known as middle housing, to craft solutions to America’s growing housing supply crisis. Registration is free. Los Angeles is the only location that will offer a livestream.

Register for NALHFA Annual Conference 2024, May 1-4 in Las Vegas. Experience education and connection at NALHFA 2024 with an Affordable Housing Bus Tour, Women in Finance Luncheon & Roundtable, Speaker Sessions, and Networking Opportunities.

Register for the Maryland Mortgage Bankers and Brokers Association Annual Conference, scheduled for Thursday, May 2nd, 10 a.m. to 4 p.m. in the picturesque setting of Queenstown. This year’s conference will delve deep into the dynamics of the mortgage industry and explore the current market trends. Whether you’re a seasoned professional or just stepping into the mortgage world, this event promises valuable insights to navigate the industry’s landscape.

In Birmingham, the MBA of Alabama will host its 38th Annual Convention on May 7 & 8.

Registration is open for ACUMA’s FOCALpoint workshops – Join ACUMA in Nashville May 9-10 or Denver June 11-12! Same amazing topics and content in each location – just pick the best city for you! The two-day subject-intensive workshops take deep dives into critical issues affecting the credit union mortgage lending industry. Sign up today! Register here for ACUMA workshops.

The MBA Georgia (MBAG) Conference is coming on May 12-15 at the One Ocean Resort, 1 Ocean Blvd, Atlantic Beach, Florida! For registration visit here.

The Single-Family Housing Guaranteed Loan Program (SFHGLP) Servicing Office in St. Louis, MO announced free, in-person training to lending partners, May 13-17 at the Charles F. Prevedel Federal Building. The training will offer multiple sessions to provide technical training on Loss Claims, Loss Mitigation, and Lender Reporting. USDA will not charge a registration fee. Attendees are responsible for all travel costs. USDA will not be blocking hotel rooms. Attendees may search for hotel accommodations near the training facility located at 9700 Page Ave, St. Louis MO 63132.

Capital Markets

A day after Fed Chair Powell threw cold water on expectations for rate cuts this year by admitting progress against inflation has stalled, Treasury and mortgage security prices rallied yesterday, dropping rates some, aided by excellent demand at a $13 billion 20-year Treasury bond reopening. Remember, even “a dead cat bounces.” There is some chatter out there that Fed Chair Powell’s tonal pivot last year is partly to blame for the lack of recent progress against inflation. Futures are now pricing in a maximum of two 25-basis point rate hikes in 2024, a far cry from the nearly 150-basis points of easing that fed fund futures had anticipated at the beginning of the year.

There was no top-tier data of note yesterday, but the Fed did release its April Beige Book, which noted that the economy has expanded at a slight pace since February. “Price increases were modest, on average,” it said. 10 of the 12 Federal Reserve Districts reported slight or modest growth while two reported no change. Consumer spending edged up slightly, though discretionary spending was pressured in some Districts. Tourism increased modestly but varied widely across the 12 Districts. Residential construction grew a little while nonresidential construction was flat. Employment rose at a slight pace while prices grew modestly, maintaining the pace seen in the last report.

We also learned that single-family home prices increased 7.4 percent from Q1 2023 to Q1 2024, up from the previous quarter’s revised annual growth rate of 6.6 percent, according to Fannie Mae’s latest Home Price Index reading. The national repeat-transaction home price index measures the average, quarterly price change for all single-family properties in the U.S., excluding condos. On a quarterly basis, home prices rose a seasonally adjusted 1.7 percent in Q1 2024, essentially the same as the growth in Q4 2023. On a non-seasonally adjusted basis, home prices also increased by 1.7 percent in Q1 2024.

Today’s economic calendar began with weekly jobless claims (212k, +1k from the prior week, continuing claims 1.812 million, so the labor market continues to do just fine) and Philadelphia Fed manufacturing (15.5, way up!). I did see an interesting report in Bloomberg yesterday that indicated cracks in a U.S. labor market that has been near historic strength for much of the past two years are forming. In five states (CA, CT, NV, NJ, WA), the ratio of jobless people per opening is one or more. Meanwhile Arizona and New York are nearing parity with a rate of 0.9, according to February data from the U.S. Bureau of Labor Statistics.

Later today brings March existing home sales and leading indicators, Freddie Mac’s Primary Mortgage Market Survey, and (once again) remarks from multiple Fed speakers. It’s also a busy day for the Treasury, which will both announce month-end supply consisting of $69 billion 2-year, $70 billion 5-year, $44 billion 7-year notes, and $32 billion 2-year FRNs and auction $23 billion 5-year TIPS. After the initial jobless claim’s news, we begin the day with Agency MBS prices marginally worse than Wednesday evening, the 10-year yielding 4.61 after closing yesterday at 4.59 percent, and the 2-year is at 4.95.

Employment

“TAYGO INC. presents an enticing new opportunity for a SaaS Sales Representative! This pivotal role is instrumental in propelling the success of TAYGOTM through selling our SaaS solutions to prospective clients. The key focus is comprehending the requirements and challenges of mortgage lenders (as well as mortgage brokers) and adeptly showcasing how our products, WEB-GOTM and RIN-GOTM, can optimize their operations and business performance. You must have a strong understanding of CRM products, their features, and the mortgage industry. You must effectively engage with prospects to understand their needs. You must also carefully monitor existing clients’ activities to identify upsell opportunities. You must have exceptional communication skills for online demos and meetings, cold or warm calls and emails. Your expertise, patience, and ability to build and maintain strong customer relationships will be vital in achieving our sales goals and ensuring customer satisfaction. Please send your resume to us.”

“Citizens has a proven track record of successfully navigating challenging market conditions while our capital, liquidity and funding positions remain strong. Retail loan officers need a diverse product mix, reliable operations, and seasoned leadership to rely on to be able to win. With great pay and generous benefits, along with strong digital tools to help you get the job done, Citizens is looking for talented loan officers in the Northeast, MidAtlantic, Midwest and Florida. Our deep product mix allows loan officers to serve many different customer needs, from affordable loan programs such as HomeReady to a best-in-class one-time close construction-to-permanent product, we have what you need to succeed. Citizens’ recent launch of Freddie Mac’s LPA enhances our vast product journey, driving a more personalized and customer-centric experience. Our specialty programs such as condo/co-op financing, along with an amazing Private Wealth discount value proposition for high net worth banking clients, ensure you have all the tools to win. We know a positive customer experience begins with loan origination but doesn’t end there. Recently the Citizens Mortgage Servicing Team received the prestigious ICE Innovation Award for Best Use of Data to Drive Automation, resulting in a 10 percent increase in our customer satisfaction scores. To learn more about how to join our team contact Carl Minott or visit here.”

 Download our mobile app to get alerts for Rob Chrisman’s Commentary.

Source: mortgagenewsdaily.com

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The Upshot

A Huge Number of Homeowners Have Mortgage Rates Too Good to Give Up

On a scale not seen in decades, many Americans are stuck in homes they would rather leave.

Emily Badger and

April 15, 2024

Something deeply unusual has happened in the American housing market over the last two years, as mortgage rates have risen to around 7 percent.

Rates that high are not, by themselves, historically remarkable. The trouble is that the average American household with a mortgage is sitting on a fixed rate that’s a whopping three points lower.

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Average fixed mortgage rates

8%

Existing
mortgages

6%

3.2-
point
gap

Rates on
new loans

4%

Rates on new home loans now far surpass rates locked in by Americans with existing
mortgages.

2%

2000

2005

2010

2015

2020

2023

Average fixed mortgage rates

8%

Existing
mortgages

6%

3.2-
point
gap

Rates on
new loans

4%

Rates on new home loans now far surpass rates locked in by Americans with existing
mortgages.

2%

2000

2005

2010

2015

2020

2023

Source: Federal Housing Finance Agency analysis. Note: New loan figures show the predicted rate that existing mortgage holders could get on the same mortgages at new market conditions.

The gap that has jumped open between these two lines has created a nationwide lock-in effect — paralyzing people in homes they may wish to leave — on a scale not seen in decades. For homeowners not looking to move anytime soon, the low rates they secured during the pandemic will benefit them for years to come. But for many others, those rates have become a complication, disrupting both household decisions and the housing market as a whole.

new research from economists at the Federal Housing Finance Agency, this lock-in effect is responsible for about 1.3 million fewer home sales in America during the run-up in rates from the spring of 2022 through the end of 2023. That’s a startling number in a nation where around five million homes sell annually in more normal times — most of those to people who already own.

These locked-in households haven’t relocated for better jobs or higher pay, and haven’t been able to downsize or acquire more space. They also haven’t opened up homes for first-time buyers. And that’s driven up prices and gummed up the market.

Share of existing mortgages with rates below or above new market rates Percentage point difference from rates on new mortgages BELOW
-3
-2
-1
0
+1
+2
+3
ABOVE
Federal Housing Finance Agency analysis. Note: Data covers all fixed-rate mortgages in the U.S.

Distribution of fixed rates held by existing mortgage holders
1999
Before the dot-com recession
2005
During the housing boom
2011
Emerging from the Great Recession
2019
On the eve of the pandemic
2023
Post-pandemic

Source: Federal Housing Finance Agency analysis. Note: Data shown captures the fourth quarter of each year.

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Source: nytimes.com

Apache is functioning normally

The Securities and Exchange Commission (SEC) this week announced new rules that will require publicly traded companies to disclose climate risks and how much greenhouse gas emissions they produce.

But compared with a prior proposed version of the rules from 2022, media outlets have characterized the rules as less onerous for companies.

“Under the original proposal, large companies would have been required to disclose not just planet-warming emissions from their own operations, but also emissions produced along what’s known as a company’s ‘value chain,’” according to reporting at The New York Times.

A “value chain” is something of a catch-all term that refers to “everything from the parts or services bought from other suppliers, to the way that people who use the products ultimately dispose of them,” the Times explained.

Pollution created up and down the value chain could certainly add up, the Times stated, but that reporting requirement is not included in the version of the rule unveiled on Wednesday.

While larger companies will have to report the emissions they directly produce, the determination of what kinds of emissions to report will be left to the companies themselves. If companies determine the produced emissions are “material,” they will have to proactively report them under the final version of the rules.

The Mortgage Bankers Association (MBA) largely lauded the move, according to a statement from president and CEO Bob Broeksmit.

“Public companies already disclose material information relevant to their financial condition and operations, including climate-related information,” Broeksmit said. “We are pleased that the SEC’s final rule addresses redundancies and that it does not contain some of the more complex and overly burdensome mandatory reporting requirements – particularly for Scope 3 emissions – that were issued in the proposal.”

Upon the initial announcement of the proposal, the MBA had recommended “a longer implementation schedule for required registrants,” which is included in the rule as announced by the SEC.

“[This is something] we appreciate given the substantial effort and resources necessary to comply with the rule,” Broeksmit said.

Given the larger focus on climate change by the Biden administration, discussion of climate issues has taken on more prominence since early 2021 when Biden took office. Still, state governments can often implement their own priorities on this front, but the MBA hopes they follow the SEC’s lead.

“MBA and its members are active participants in policy conversations and market developments on climate risk, extreme weather impacts, and ESG (environmental, social and governance) investing at the federal and state levels,” Broeksmit said.

“We urge state legislatures to refrain from proceeding with, or introducing, proposals that exceed this rulemaking or that impose costly and time-consuming reporting requirements that adversely impact businesses and consumers in their state.”

Source: housingwire.com

Apache is functioning normally

News that Capital One has struck a deal to buy Discover shook up the normally quiet Presidents Day banking holiday on Monday, teeing up the possibility of making Capital One the nation’s largest credit card issuer.

The Wall Street Journal reported the potential merger on Monday, followed by other outlets like Bloomberg and the New York Times. Capital One then released a statement confirming the planned acquisition.

Capital One Financial Corp., based in McLean, Virginia, is the nation’s ninth-largest bank by total assets, with 259 physical branch locations, 55 “Capital One Cafes” across the country and a major online banking operation. Discover Financial, based in Riverwoods, Illinois, is a mostly online bank with a single physical branch in Delaware. The all-stock deal is valued at $35.3 billion.

See the best Capital One cards

Capital One has cards for earning rewards and cards for building credit. Some even do both.

Is Discover on board?

Michael Rhodes, CEO and president of Discover, touted the deal in Capital One’s press release: “The transaction with Capital One brings together two strong brands with enhanced ability to accelerate growth and maximizes value for our shareholders, enabling them to participate in the tremendous upside of the combined company.”

What happens next?

Bank mergers must be approved by bank regulators and by shareholders of each company. If the deal goes through, Capital One estimates that it will close in late 2024 or early 2025.

What would it mean for customers?

During the approval process, little is expected to change as the companies continue to operate independently. Even if the deal is approved, though, current customers may see little effect.

“I think it’s not going to be a big change for credit card customers,” says David Robertson, editor and owner of the Nilson Report, a payment card industry trade journal. Discover cards, he says, are primarily cash-back cards, while Capital One offers a variety of rewards cards. A merger, Robinson says, “might allow for better rewards programs for both companies.”

While the Wall Street Journal reported that Capital One plans to keep the Discover name on at least some cards, details have not been confirmed by either company. Likewise, there is no detail yet on how banking customers will be affected.

Why merge?

Item no. 1: Discover’s payment network.

Transactions on Capital One cards are processed over the Visa and Mastercard payment networks. Discover, however, operates its own network, making it both a card issuer and a payment processor, similar to American Express. Robertson says acquiring a payment network and building direct relationships with more merchants is likely a driving factor in Capital One’s acquisition, which puts a 26.9% premium on Discover’s Feb. 16 closing stock price.

​​”From Capital One’s founding days, we set out to build a payments and banking company powered by modern technology,” Richard Fairbank, founder and CEO of Capital One, said in the news release. “Our acquisition of Discover is a singular opportunity to bring together two very successful companies with complementary capabilities and franchises, and to build a payments network that can compete with the largest payments networks and payments companies.”

In addition, Robertson notes, there is not a great deal of overlap between the two banks’ customer bases. “One would assume that everyone that has a Discover Card also has a Visa or MasterCard,” he says. “Capital One may get access to that spending.”

Capital One is the fourth largest credit card issuer in the United States by loan volume; Discover is ranked sixth, according to Nilson Report data. Combined, they would nudge ahead of Chase to become the largest card issuer.

Sheer economy of scale is another factor. “Should [the merger] occur, Capital One would be the largest credit card issuer” as measured by outstanding debt, says Robertson.

Who doesn’t want to be rewarded?

Create a NerdWallet account for personalized recommendations, and find the card that rewards you the most for your spending.

Source: nerdwallet.com

Apache is functioning normally

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