http://www.mortgagenewsdaily.com/ Mortgage News Daily https://www.mortgagenewsdaily.com/markets/mbs-recap-06182026 Thu, 18 Jun 2026 19:19:38 GMT 6a34532ca6791958c5124bfd Matthew Graham Perfectly Acceptable Conclusion to a Potentially Volatile Week With markets closed for the Juneteenth holiday on Friday, Thursday marked the end of the trading week. Considering the sell-off on Wednesday afternoon, the week had the potential to end on an uncomfortably volatile note. Instead, bonds pushed back nicely in the other direction--even though MBS didn't recoup as much of their losses as 10yr Treasuries. True, there is some sense of foreboding in the inability of 10yr yields to move below 4.42%, but all told, the week was actually surprisingly calm after factoring in Thursday's gains. Econ Data / Events Continued Claims (Jun)/06 1,810K vs 1800K f'cast, 1795K prev Jobless Claims (Jun)/13 226K vs 225K f'cast, 229K prev Philly Fed Business Index (Jun) 10.3 vs 10 f'cast, -0.4 prev Philly Fed Prices Paid (Jun) 53.20 vs -- f'cast, 47.90 prev Market Movement Recap 08:55 AM Bonds recover much of post-Fed sell-ff overnight, but mostly in the long end. 2yr yields lost more ground. 10yr yields are down 5bps at 4.446.  MBS are up just under a quarter point. 10:24 AM MBS up 9 ticks (.28) and 10yr down 6.3bps at 4.434 03:02 PM MBS up 5 ticks (.16) and 10yr down 4.2bps at 4.454 Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full https://www.mortgagenewsdaily.com/markets/mortgage-rates-06182026 Thu, 18 Jun 2026 16:46:00 GMT 6a3423168e1136df3cd86966 Matthew Graham Mortgage rates spiked yesterday after the Fed announcement. The primary driver was the Fed's revised outlook for potential rate hikes later this year. Because the Fed Funds Rate governs ultra-short-term transactions (24hrs or less), it has the biggest impact on the shortest-term debt and a diminishing impact on longer term debt. While the typical mortgage may be ABLE to last for 30 years, in practice, the average mortgage length (due to refinances and sales) is a moving target assumed to be around 5 years. That's helping us today.  Shorter-term debt is still having some indigestion over Fed day, but longer-term debt has recovered more of yesterday's losses. Top tier 30yr fixed rates are about halfway back to yesterday's pre-Fed levels for the average mortgage lender and in the lower-middle of the range seen since mid-May. Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full https://www.mortgagenewsdaily.com/news/06182026-mortgage-applications-mba Thu, 18 Jun 2026 16:25:00 GMT 6a341cc42b0e52b3f440c7ac Matthew Graham Mortgage applications pulled back last week as rates moved around in response to fresh inflation data and shifting geopolitical headlines. The Mortgage Bankers Association (MBA) reported a 3.8% decline in total application volume on a seasonally adjusted basis for the week ending June 12. Refinance activity accounted for much of the slowdown. The Refinance Index fell 5% from the previous week, though it remained 17% above the same period one year ago. Purchase demand also softened, but has generally done a better job of holding near multi-year highs. The seasonally adjusted Purchase Index decreased 3% week over week and was 3% higher than a year ago. “Last week’s CPI data showed that inflation continued to move higher, putting upward pressure on rates early in the week, but growing optimism regarding the opening of the Strait of Hormuz brought rates down again by the end of the week,” said Mike Fratantoni, MBA’s SVP and chief economist. He said the net effect was a drop in both purchase and refinance activity, with purchase applications still modestly ahead of last year’s pace and conventional purchase volume showing stronger growth than government lending. Refinance share of mortgage activity edged up to 40.3% from 40.2%, while the ARM share slipped to 8.5% from 8.6%. Government-backed application shares were mixed. FHA share increased to 17.5% from 17.4%, while VA share declined to 12.9% from 13.4%. USDA share was unchanged at 0.4% . Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full https://www.mortgagenewsdaily.com/news/06182026-builder-confidence-nahb-hmi Thu, 18 Jun 2026 16:22:00 GMT 6a341bb12b0e52b3f440c7a9 Matthew Graham Builder sentiment slipped again in June as elevated mortgage rates, higher material costs and ongoing affordability pressures continued to weigh on the housing market. The National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) fell two points to 35 , marking the 14th straight month the index has remained below 40. The latest reading underscores how far confidence remains from more durable levels. A streak that long below 40 has not been seen since 2011-2012 , when the market was still dealing with the fallout from the foreclosure crisis. All three major components of the index were either lower or unchanged. Current sales conditions slipped two points to 38 , while sales expectations over the next six months held steady at 45 . Traffic of prospective buyers remained unchanged at 25 , suggesting demand is still soft despite the start of the summer selling season. “With the nation short about 1.2 million homes, builder sentiment will remain soft until barriers are eased and conditions improve for home building,” said NAHB Chairman Bill Owens. He said Congress could help by advancing the major housing package now before the Senate, along with legislation aimed at easing labor shortages and protecting access to natural gas in new homes. NAHB Chief Economist Robert Dietz said regulatory and policy costs continue to make it harder for builders to add supply. He pointed to a new NAHB study showing that government regulation, taxes, fees and other costs add more than 26% to the price of an average single-family home, arguing that easing permitting delays, density limits and zoning restrictions would help reduce costs. Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full https://www.mortgagenewsdaily.com/opinion/pipelinepress-06182026 Thu, 18 Jun 2026 15:35:48 GMT 6a33e5b6cc25bd518336926d Rob Chrisman Lots of people who bought cars during the pandemic are deeply underwater on those vehicles, meaning the amount they owe is considerably higher than the actual value of the vehicle. Among car buyers who traded in a car to buy a new one, 30 percent had negative equity on their trade-in, owing an average of $7,200. One thing that may have caused the surge is the emergence of the 84-month (seven year) car loan; 42.6 percent of underwater buyers had an 84-month loan, about double the level of a decade ago. (Today’s podcast can be found here and this week’s ‘casts are sponsored by Truework, the one verification solution to replace in-house waterfalls. Verify any borrower with a VOIE solution that automates the entire process to quickly deliver the most accurate and complete reports with broad GSE coverage. Hear interview with National Consumer Reporting Association’s Eric Ellman on the nomination of Brian Johnson to lead the Consumer Financial Protection Bureau, based on his extensive experience in financial services regulation and his understanding of how to balance consumer protection with access to credit, mortgages, and housing.) Broker and Lender Products, Software, and Services Borrower outreach isn't broken. The experience is. Most servicers have no shortage of communication channels. The challenge is creating a connected experience that helps borrowers understand their options and the next steps. Clarifire’s latest blog explores where communication breaks down during default servicing, why early delinquency engagement matters, and how workflow automation can reduce confusion, improve responsiveness, and drive better outcomes for both borrowers and servicing teams. Discover how connected workflows, intelligent intake, and self-service tools can improve borrower engagement and servicing outcomes. Read "Closing the Borrower Communication Gap" at eClarifire.com, where Brighter Automation® creates better outcomes. Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full https://www.mortgagenewsdaily.com/markets/mbs-morning-06182026 Thu, 18 Jun 2026 14:04:24 GMT 6a340958a6791958c511b900 Matthew Graham Trump officially signed the Iran MOU last night , which helped oil prices and bond yields move a bit lower. Overseas markets also did a decent job digesting the post-Warsh trade, quarantining most of the damage to the shortest end of the yield curve and buying the longer end (i.e. 10yr rallied back almost completely while 2yr barely rallied). The net effect is a 10yr yield that is back on the doorstep of the 4.42% technical floor (currently 4.435%). MBS have a shorter implied duration than 10 years and only a bit better than halfway back to yesterday's pre-Fed levels. As a reminder, markets are closed Friday. There is no big ticket econ today, so traders will be left to focus on technicals, pre-weekend positioning, and any headlines of consequence. Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full https://www.mortgagenewsdaily.com/markets/mbs-recap-06172026 Wed, 17 Jun 2026 21:00:13 GMT 6a33191ca6791958c5106f87 Matthew Graham Bonds Tell Warsh What They Think of His Changes Ironically, one of Warsh's comments in today's press conference was that market movement is the most important source of information for the Fed. At the same time, the market was effectively saying that it was also fond of hearing what was on the Fed's mind, and if the Fed is going to stop sharing those thoughts, the market was going to cry about it. This certainly wasn't the whole story as the hawkish dot plot did about half the damage well before the press conference. One could also argue that some traders may have expected Warsh to do something to push back against that Hawkishness. Instead, he did very little apart from reference various task forces that would be working on several projects. In general, the lack of transparency and the absence of even a semblance of forward guidance led the market to rapidly price in a higher risk premium in both stocks and bonds. Bottom line, markets said "if you aren't going to do anything to push back on that hawkish dot plot, we're gonna go ahead and assume rate hikes are more likely."  Econ Data / Events Retail Sales (May) 0.9% vs 0.5% f'cast, 0.5% prev Retail Sales Control Group MoM (May) 0.7% vs 0.4% f'cast, 0.5% prev Market Movement Recap 08:33 AM Flat overnight and no reaction to data. MBS unchanged and 10yr unchanged at 4.44. 11:30 AM MBS up 1 tick (.03) and 10yr down 1bp at 4.431 02:17 PM MBS down an eighth and 10yr up 1.2bps at 4.455 03:10 PM MBS down 10 ticks (.31) and 10yr up 3.2bps at 4.473 Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full https://www.mortgagenewsdaily.com/markets/mortgage-rates-06172026 Wed, 17 Jun 2026 20:09:00 GMT 6a3303bc47748140ba24a1c9 Matthew Graham Mortgage rates quickly erased a week of progress this afternoon following the Fed announcement and press conference. Fed announcement day historically has several components: the announcement itself, the summary of economic projections (SEP), and the press conference.  Within the SEP, there is the dot plot showing each Fed member's assumptions about where the Fed Funds Rate will be in the future if the economy continues on the expected course. "The dots" only come out every other Fed meeting, but they have a habit of causing volatile market reactions. Today's was no exception. The dots essentially show that the average Fed member now sees the Fed Funds rate at least 0.25% higher at the end of 2026 than they did back in March. This is responsible for the first big move in the bond market today. Bonds lost more ground during new Fed Chair Kevin Warsh's press conference. The reasons for this could be debated. Some traders may have been expecting Warsh to push back against the dot plot with a more rate-friendly tone. Others may have been disheartened at the lack of any guidance about how the Fed is interpreting incoming economic data. In general, lower transparency regarding the Fed's reaction function arguably requires traders to price in a higher risk premium. Because rates are based on bonds, and because bonds lost ground sharply, mortgage lenders ended up raising rates in the afternoon--some of them up to 3 times. When the dust settled, the average lender was back up to June 10th levels with top-tier 30yr fixed rates at 6.62%. Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full https://www.mortgagenewsdaily.com/markets/mbs-06172026 Wed, 17 Jun 2026 18:00:57 GMT 6a32eeeca6791958c5101901 Matthew Graham Recent indicators suggest that economic activity has been expanding at The Federal Open Market Committee approved the following statement for release by a solid pace. Job gains have remained low, on average, and the unemployment rate has been little changed in recent months. Inflation is elevated, in part reflecting the recent increase in global energy prices. 12 – 0 vote: The Committee seeks decided to achieve maximum employment and inflation maintain the target range for the federal funds rate at the rate of 2 percent over the longer run. Developments 3-1/2 to 3-3/4 percent, in the Middle East are contributing to a high level of uncertainty about the economic outlook. support of the Federal Reserve’s dual mandate. The Committee is attentive to reaffirmed its policy of maintaining ample reserves in the risks to both sides of its dual mandate. banking system. In support of its goals, the Committee decided to maintain the target range for the federal funds rate Economic activity is expanding at 3‑1/2 to 3‑3/4 percent. In considering the extent and timing of additional adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, a solid pace despite elevated uncertainty that owes, in part, to the conflict in the evolving outlook, Middle East. Productivity growth and capital investment are strong. Job gains have kept pace with the balance of risks. The Committee is strongly committed to supporting maximum employment workforce, and returning inflation to its 2 percent objective. the unemployment rate has changed little. In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook. The Committee would be prepared Inflation remains elevated relative to adjust the stance of monetary policy as appropriate if risks emerge the Committee’s 2 percent goal, in part reflecting supply shocks that could impede the attainment of the Committee’s goals. have driven price increases in certain sectors, including energy. The Committee’s assessments Committee will take into account a wide range of information, including readings on labor market conditions, inflation pressures and inflation expectations, and financial and international developments. deliver price stability. Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full https://www.mortgagenewsdaily.com/opinion/pipelinepress-06172026 Wed, 17 Jun 2026 15:44:51 GMT 6a328907421e7aeef4ef19b2 Rob Chrisman Here in Honolulu, as it is in places like Florida and New York, the condo market and HOA fees are of paramount importance, as are the affordability impact of special assessments. Even though the inventory of houses for sale has steadily increased in many areas, some people want more. One idea being bantered about is changing, or eliminating, the capital gains tax on the sale of primary residences. Money talks, and as this veteran LO points out, a housing crash won’t fix affordability. A crackdown on H-1B visas is causing Indian buyers to leave the Dallas housing market, meaning skilled professionals who transformed the region now face exile. That story and the following ones offer a look into the challenges facing homeowners and renters around the world, from San Francisco to the United Kingdom. The impact of demographics on lenders will be one the topics on today’s Mortgage Matters at 11AM PT with Sue Meitner, CMB, the President of Centennial Lending Group (a division of SMP) and sponsored by Lenders One. (Today’s podcast can be found here and this week’s ‘casts are sponsored by Truework, the one verification solution to replace in-house waterfalls. Verify any borrower with a VOIE solution that automates the entire process to quickly deliver the most accurate and complete reports with broad GSE coverage. Hear an interview with Addy AI’s Michael Vandi on importance of AI in improving efficiency and competitiveness, especially as a productivity tool for originators.) Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/full