Are your underwriters this fast? The current Administration has been fast to ax groups of employees in various government departments, including the Agencies. The Supreme Court challenged 90 years of precedent and has decided that firings of government agency members will stand (including, of interest to lenders, the CFPB) as the cases work their way through the lower courts, giving the President unfettered power to oust regulators without good cause. However, SCOTUS spared the Federal Reserve in the ruling, writing that the Fed is “uniquely situated” and unlike other government agencies. Justice Elena Kagan sharply dissented, writing that the court’s ruling was “nothing short of extraordinary” giving President Trump the power to fire the heads of government agencies while sparing the Federal Reserve. In other legal news of interest to lenders, a Hawaiian woman pleaded guilty last week to defrauding her mortgage lender and conspiring to defraud the IRS. Yes, it happens even in a wonderful place like Hawai’i. (Today’s podcast can be found here and this week’s is sponsored by Calque. Calque provides a binding backup offer on your borrower’s departing residence to clear the existing mortgage balance and closing costs in 48 business hours or less. And it costs less than other buy before you sell solutions. Hear an interview with Bill Dallas on evolving business models, game-changing innovations, leadership lessons from past cycles, and how to build a more inclusive, tech-driven mortgage system from the ground up.)

Software, Products, and Services for Lenders and Brokers

M&A, Warehouse Lines and Purchase Agreements, Handled by Lawyers Who Know Mortgage! In today’s volatile market, executing deals and protecting your downside requires legal counsel that knows more than just the law… The firm needs to know your business. At the recent Mortgage Bankers Association meeting, Troy Garris and Melanie Feliciano of Garris Horn LLP were deep in conversation with executives on how to approach today’s strategic transactions. “You need to understand the law, but also the people, the operations, and the pressure points,” said Garris. Feliciano added, “Whether it’s M&A, warehouse facilities, or investor agreements, experience in this industry matters.” From reviewing warehouse facilities to negotiating loan purchase and servicing agreements, Garris Horn delivers practical, fast, and business-driven legal support, without needing a crash course in mortgage lending with a focus on helping mortgage companies move quickly and confidently in complex deals. Contact Troy Garris or Melanie Feliciano for more information.

Get a Head Start! Schedule your firm’s 2025 MERS Annual Review & Report with TENA Companies, Inc. today. Every MERS member is required to complete a MERS Annual Review & Report. If your firm had 1,000+ active MINs on March 31, 2025, you must use an independent third party for the review, with the results submitted by December 31st. Lock in significant savings by signing up for the MERS Annual Review & Report with TENA and provide all required documentation by August 31st. Beyond the Annual Review & Report, TENA offers a comprehensive suite of MERS Compliance services, including MERS Data Reconciliation and MERS Document Reviews. TENA Companies, Inc. has been the mortgage industry’s trusted source for Mortgage Quality Control Services and Software, serving with excellence since 1982. Don’t delay, contact TENA today to save money and avoid rushing to complete the MERS Annual Review & Report during the busy end-of-year season!

Streamline your MSR buying/selling through the ServiceMac Exchange (SMX). Leverage capital markets efficiency with the ServiceMac Exchange (SMX), an online platform designed to connect mortgage servicing rights buyers and sellers, streamlining the transaction process. ServiceMac’s newly launched exchange provides a valuable MSR trading platform supported by ServiceMac’s world-class customer service and best-in-class execution. The exchange connects MSR buyers and sellers with support features that provide frictionless pricing and transfer, while delivering confidence and compliance. Benefits include efficient transfer and post-closing process, counterparty management, legal review, escrow services, loan boarding, document management, transfer management, subservicing, and more. Click now to learn more about these and the many other benefits of SMX.

“Power Up Your Pipeline. Join Our June Broker Trainings! Get ready to elevate your lending game with Kind TPO’s June Training Series, every Thursday at 11:30 AM PDT! Each session delivers real-world strategies to help you qualify more borrowers and close more deals with confidence. June 5 – Non-QM Bank Statements. June 12 – Unlock More Deals with AMI Products! June 19 – Asset Utilization Loans: Using Assets for Qualifying Income. June 26 – Go Big with Jumbo: Win High-Balance Business with Confidence. Don't miss out on the insights that set you apart in today’s market. Click here to register now! Not an approved partner yet? Click here to get started!”

Free EBook: Helping Borrowers Navigate Loan Products & Pricing: A Loan Officer’s Guide to Winning Trust and Closing More Loans. Today’s borrowers are overwhelmed with fluctuating rates, rising home prices, and a maze of loan options. A loan officer’s ability to simplify the process and offer clear, fast solutions is the ultimate advantage. In Maxwell’s eBook, LOs will learn how to quickly deliver personalized, easy-to-understand loan comparisons that build borrower confidence and set you apart from the competition. Discover time-saving strategies, tech tips, and proven methods to create a seamless borrower experience, and close more deals. Click here to download “Helping Borrowers Navigate Loan Products & Pricing: A Loan Officer’s Guide to Winning Trust and Closing More Loans.”

Servicers must be ready to adapt to changing market conditions and consumer preferences to stay ahead and meet their customers’ needs. ICE’s new eBook, "The strategic servicer's playbook: Four ways to fortify your servicing operations to adapt to any market," explores how servicers can strategically bolster their operations to help find success no matter the market. That starts with offering homeowners' easy access to their home and loan information, providing the right tools so back-office teams can dedicate themselves to high-value work instead of routine tasks, and analyzing data insights to reveal opportunities for recapturing business. Download your complimentary copy of the eBook to learn how to position yourself for success.

Disaster and Climate-Related News

Yes, NOAA will stop tracking weather disasters because President Trump doesn’t believe in climate change. Yup, the National Oceanic and Atmospheric Administration (NOAA) will no longer update its widely cited list of weather and climate disasters that cause billions of dollars in damage, in yet another stunning example of the Trump administration's hostility towards climate science. But that doesn’t mean natural disasters or climate change is going away… Just ask anyone hit by a catastrophe.

ZestyAI, the leader in AI-driven risk analytics for insurance, revealed that more than 12.6 million U.S. properties are at high risk of hail-related roof damage, representing $189.5 billion in potential replacement costs. “Powered by ZestyAI’s Z-HAIL™ model, the analysis underscores the growing financial threat of severe convective storms (SCS), including hail, tornadoes, and wind events. In 2024 alone, damages from SCS were estimated at $56 billion, surpassing losses from hurricanes. Yet many insurers still rely on traditional models designed to estimate portfolio-level exposure, not property-level risk. As hail events increase in severity and frequency, these models often miss the structural and environmental conditions that drive real losses.”

Lenders and servicers carefully watch FEMA for its disaster declarations since borrowers and property values are impacted.

PHH Mortgage Announcement: Disaster Alert Update Kentucky describes modifications pertaining to Kentucky DR-4864, additional counties declared.

PHH Mortgage Announcement: Disaster Alert Update Arkansas pertaining to a new disaster declaration Arkansas DR-4865.

On 5/14/2025, with Amendment No.1 to DR-4864, FEMA declared federal disaster aid with individual assistance to 24 additional Kentucky counties affected by severe storms, straight-line winds, tornadoes, flooding, landslides, & mudslides from 4/2/2025 & continuing. For inspection requirements, view AmeriHome Mortgage 20250503-CL Disaster Announcement – Kentucky Tornadoes.

On 5/8/2025, with DR-4865, FEMA declared federal disaster aid with individual assistance to 9 counties affected by severe storms and tornadoes from 3/14/2025 to 3/15/2025. See AmeriHome Mortgage 20250502-CL Disaster Announcement – Arkansas Tornadoes for inspection requirements.

Kentucky Severe Storms, Straight-line Winds, and Tornadoes DR-4875-KY

Mississippi Severe Storms, Straight-line Winds, Tornadoes, and Flooding DR-4874-MS

Texas Severe Storms and Flooding DR-4871-TX

Missouri Severe Storms, Straight-line Winds, Tornadoes, and Wildfires DR-4867-MO

Oklahoma Wildfires and Straight-line Winds DR-4866-OK

Arkansas Severe Storms, Tornadoes, and Flooding DR-4873-AR.

On 5/23/2025, with DR-4875, FEMA declared federal disaster aid with individual assistance to Kentucky counties of Caldwell, Laurel, Pulaski, Russell, Trigg and Union affected by severe storms, straight-line winds, and tornadoes from 3/16/2025 to 3/17/2025. See AmeriHome Mortgage 20250514-CL Disaster Announcement for inspection requirements.

On 5/21/2025, with DR-4874, FEMA declared federal disaster aid with individual assistance to eleven Mississippi counties affected by severe storms, straight-line winds, tornadoes, and flooding from 3/14/2025 to 3/15/2025. See AmeriHome Mortgage 20250513-CL Disaster Announcement for inspection requirements.

On 5/21/2025, with DR-4871, FEMA declared federal disaster aid with individual assistance to Texas counties Cameron, Hidalgo, Starr, and Willacy affected by severe storms and flooding from 3/26/2025 to 3/28/2025. See AmeriHome Mortgage 20250512-CL Disaster Announcement for inspection requirements.

On 5/21/2025, with DR-4867, FEMA declared federal disaster aid with individual assistance to eighteen Missouri counties affected by severe storms, straight-line winds, tornadoes, and wildfires from 3/14/2025 to 3/15/2025. See AmeriHome Mortgage 20250511-CL Disaster Announcement for inspection requirements.

On 5/21/2025, with DR-4866, FEMA declared federal disaster aid with individual assistance to seven counties affected by Oklahoma wildfires and straight-line winds from 3/14/2025 to 3/21/2025. See AmeriHome Mortgage 20250510-CL Disaster Announcement for inspection requirements.

5/21/2025, with DR-4873, FEMA declared federal disaster aid with individual assistance to sixteen counties in Arkansas affected by severe storms, tornadoes, and flooding from 4/2/2025 to 4/22/2025. See AmeriHome Mortgage 20250509-CL Disaster Announcement for inspection requirements.

PHH Mortgage posted information on the following issued new disaster declarations: Arkansas DR-4873, Texas DR-4871, Missouri DR-4867, and Oklahoma DR-4866. Go to the company library to view the PHH Mortgage Announcement: Disaster Alert Update AR, TX, MO, OK.

Capital Markets

The focus of last week was the sweeping, multi-trillion-dollar tax reform package spanning over 1,000 pages. The legislation passed the U.S. House by one vote (the final tally was 215-214) and now awaits Senate discussion and approval. Concerns over the implications of the bill on the ballooning U.S. fiscal deficit fueled a bruising bond sell-off on Wednesday. Keeping on with politics, because they do, in fact, influence the economy and rates and psychology, with the spending bill getting through the U.S. House, Trump turned his attention back to trade matters. After nearly two weeks of calm on that front following a surprise U.S.-China “truce,” Trump threatened new tariffs on iPhone-maker Apple (AAPL) and the European Union. His actions reminded market participants that a trade war escalation can still come out of the blue.

Last week was another light week for economic data releases, which allowed the budget reconciliation process to take the spotlight. The bill, in its current form, would lead to higher deficits and therefore the need for more Treasury issuance to fund the government. Yields have risen as a result and the average 30-year fixed mortgage rate now sits around 6.86 percent.

Existing home sales fell 0.5 percent in April to a 4.00-million-unit annual pace; nearly 40 percent below 2021’s peak pace. New home sales aren’t faring much better as they are down 1.9 percent year-to-date. Prices have also fallen 2 percent as builders cut prices to help move inventory. At the end of April, 504k new homes were available for sale, matching their 2007 peak. New home sales now represent roughly 30 percent of available homes for sale which is significantly higher than the trend over the last couple decades. While lower rates could help ease affordability issues, relief may not come for a while. The Fed remains in a wait and see mode as risks to inflation as well as the job market remain with neither sending a clear signal for an immediate change to monetary policy.

This holiday-shortened week’s data includes durable goods orders, house price indices, consumer confidence, Fed surveys, the second look at Q2 GDP, with PCE and Michigan sentiment on Friday’s month-end session. Treasury will auction $183 billion in notes supply over Tuesday through Thursday as well as $28 billion reopened 20-year FRNs. Today’s calendar is busy in terms of data, supply, and Fed speakers.

Kicking off the data is the always volatile durable goods orders, this time for April: -6.3 percent, ex-transportation +.2 percent. (Expectations were for an 8.2 percent plunge after increasing a revised 7.5 percent previously.) Later today brings house prices from FHFA and Case-Shiller, Consumer confidence in May, Dallas Fed Texas manufacturing in May, and Treasury auctions that will be headlined by $69 billion 2-year notes. We will also receive remarks from Minneapolis Fed President Kashkari and New York Fed President Williams. We begin the holiday-shortened week with Agency MBS prices slightly better than Friday’s close, the 2-year yielding 3.98, and the 10-year yielding 4.47 after closing last week at 4.51 percent.