Sure, we have a Fed meeting, but the Fed doesn’t set mortgage rates. Will they all head off on vacation after this week? Perhaps. Given the increase in the “out of office” replies I am seeing, and children in airports, summer vacation is in full swing. (Apparently families will change their spending habits to accommodate the run up in fuel costs; my local gas station won’t let me go above $100 per visit on my credit card.) In an extreme example to time management, the U.S. Congress has only 16 legislative days left on its agenda until the election; the rest of the time is vacation and campaigning to keep their jobs. In other words, don’t look for much from Congress until January. Certainly, no politician wants to cut spending despite the deficit continuing to escalate. What would you tell your kids if their incomes weren’t doing much but they were ramping up their spending? (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. Interview with TrustEngine’s Dave Savage on why the mortgage professionals who will thrive are those who obsess over delivering a modern, technology-enabled consumer experience, embrace AI to scale advice and efficiency, and focus on educating and advocating.)

Broker and Lender Products, Software, and Services

Looking to scale non-QM production? Don’t overlook your strongest lever: servicing. LoanCare® brings more than four decades of subservicing experience across non-agency assets, from bank statement loans to HELOCs. They have flexibility, compliance infrastructure, and loss mitigation expertise to handle complex borrower scenarios. Connect with the LoanCare team this week at IMN’s non-QM Forum and learn how to make servicing your competitive advantage.

Mortgage lenders know they need AI and automation, but many approaches fall short. Most tools today focus on optimizing individual tasks, not the full loan process. That may remove small inefficiencies, but it rarely drives meaningful reductions in cost per loan or speeds up credit decisions at scale. JazzX AI takes a different approach, delivering end-to-end intelligent automation with digital assistants that work alongside your existing LOS to streamline operations across the entire loan lifecycle. The result is lower costs, faster decisions, and improved quality without adding headcount. Book a demo with the JazzXteam.

AI in mortgage servicing has moved beyond experimentation and is now delivering measurable results. As servicers face increasing pressure to improve efficiency, enhance homeowner experiences, and navigate regulatory complexity, Sagent’s Dara platform is helping put AI to work across their operations. Dara provides a flexible, agentic AI framework that allows servicers to deploy embedded AI agents, integrate existing AI investments, or adopt a hybrid approach. From homeowner interactions to workflows like PMI removal, AI agents collaborate in real time to streamline processes and accelerate outcomes. Built specifically for the highly regulated servicing environment, Dara combines responsible AI with human oversight, ensuring transparency, auditability, and compliance. With RegIQ, servicers can transform thousands of regulatory requirements into actionable intelligence, while Ask Dara enables teams to quickly surface insights and act directly within the platform. AI is no longer a future concept for servicing: it’s becoming foundational. Discover more about Dara here.

Less back-and-forth. More first-time-right verifications. Truework replaces manual verification waterfalls with a single automated platform, so underwriters, LOs, and ops can cut down the document chasing, conflicting numbers, and last-minute corrections. Lenders see up to 50 percent cost savings on verifications, with faster turn times, higher accuracy, and stronger R&W relief. Trusted by 4 of the top 5 lenders in the U.S., Truework gives your team verification results they can rely on. Learn more.

What do airport Wi-Fi, assemble-it-yourself furniture, and a mortgage borrower waiting for an update have in common? All three can test a person’s patience. LenderLogix released a free eGuide, What Today’s Mortgage Borrowers Expect and How AI Is Closing the Gap, looking at why today’s borrowers expect faster answers, clearer guidance, and a process that feels less like a mystery novel. The guide also explores how AI can help mortgage teams reduce backend friction and stay focused on the borrower experience without replacing the human relationship that still matters most. Download the free eGuide here!

The Chrisman Marketplace is a centralized hub for vendors and service providers across the industry to be viewed by lenders in a very cost-effective manner. We’re adding new providers daily, so check back often to see what’s new. To reserve your place or learn more, contact us at info@chrismancommentary.com.

Big Investors and Artificial Intelligence

You can’t attend a conference these days without hearing about AI. Small companies may not know what to make of it all and often look at larger companies to see what they’re up to.

PennyMac Financial Services, Inc. (NYSE: PFSI) (Pennymac) is expanding its strategic agreement with Amazon Web Services, Inc. (AWS), an Amazon.com, Inc. company, to accelerate its transformation into an AI-driven mortgage technology leader. “Building on years of successful collaboration, Pennymac is now leveraging AWS’ generative AI capabilities to upgrade the mortgage application and servicing processes. As part of this digital transformation, the company has developed conversational AI-powered virtual assistant capabilities, powered by Amazon Nova Sonic, to elevate the borrower experience. Additionally, the expanded agreement accelerates the cloud modernization of Plaisse, Pennymac’s proprietary mortgage servicing platform, across its operations.

“With AWS, Pennymac is making it easier for borrowers to apply, understand their options, and get answers quickly by replacing fragmented legacy processes with an immediate, conversational borrowing experience. Architected around advanced speech-to-speech capabilities powered by Amazon Nova Sonic, Pennymac’s proprietary Natural Language Virtual Assistant (NLVA) delivers real-time voice interactions for phone contacts. Through Pennymac's intentional workflow engineering, the NLVA optimizes customer outreach by instantly engaging with users to identify new loan opportunities, deliver online application links, and schedule priority callbacks. This Pennymac-designed voice assistant provides around-the-clock responsiveness to handle after-hours calls and scale operations seamlessly, while human loan officers retain ultimate decision-making authority.

Remember Fair Lending?

Like many of you, attorney Brian Levy read Homer’s The Odyssey in high school (or just saw an ad for the upcoming Christopher Nolan movie starring Matt Daman). Levy is out with another one of his Mortgage Musings; this time examining the recent CFPB Statement (in response to a Trump Executive Order) about assessing ability to repay for immigrants subject to deportation. Levy charts a course through what he calls the strait of Homer(z) between a whirlpool of fair lending and a six headed monster of ATR.

Forbes published an article titled, “New Fair-Lending Rule Leaves AI Mortgage Lenders Exposed This July.”

The Fair Housing Act has protected disabled people from housing discrimination since 1988. For nearly two decades, the U.S. Department of Housing and Urban Development (HUD) made clear through official guidance that emotional support animals (ESAs) (animals that provide comfort and therapeutic benefit to disabled people with mental health, neurological, and other disabilities) were protected under that law. Landlords were generally required to allow ESAs, without pet fees or other penalties. On May 22, 2026, that protection was swept away in a single internal memo. Signed by FHEO Assistant Secretary Craig Trainor and effective immediately, the memo permanently cancels HUD’s prior ESA guidance and instructs agency staff to stop pursuing complaints from tenants whose ESAs have not been individually trained to perform disability-related work or tasks.

AI and Your Company… How Are You Governing It?

I recently received a note from Brian Vieaux, the President of MISMO, addressing a topic that many in residential lending are thinking about: AI Is Already in Your Mortgage Company. Do You Know Where?

“Artificial intelligence is no longer a future consideration for mortgage lenders. It is already embedded throughout the mortgage ecosystem, in loan origination systems, document processing platforms, fraud detection tools, servicing technologies, quality control systems, marketing platforms, and borrower-facing applications. The question is no longer whether lenders are using AI. The question is whether they know where AI is being used and whether they are governing it appropriately.

“That was the central theme of a recent conversation I joined with Greg Sher and Dan Sugg, Chairman of MBA's Residential Board of Governors (RESBOG), to discuss the newly released MBA White Paper, Examining AI-Powered Mortgage Through the Lens of Federal Law, and MISMO's new Framework for Responsible AI in the Mortgage Ecosystem (FRAME).

“One of the most important conclusions from the MBA white paper is that lenders do not need to wait for new AI-specific laws. Existing regulations already apply. The Equal Credit Opportunity Act, Fair Housing Act, Fair Credit Reporting Act, Gramm-Leach-Bliley Act, RESPA, HMDA, and UDAAP requirements remain fully applicable when AI is involved in decisions, recommendations, communications, or workflows. The challenge for lenders is demonstrating compliance when AI systems are part of the process.

“The paper also highlights several key risk areas organizations should address now: fair lending and bias, explainability, steering, privacy and data security, and third-party/vendor risk. Importantly, purchasing AI from a vendor does not transfer accountability. If an AI-enabled system creates compliance, consumer protection, or fair lending concerns, the lender remains responsible.

“That reality is one reason RESBOG identified AI governance as a strategic priority and asked MISMO to develop a mortgage-specific framework. The result is FRAME, a practical governance toolkit designed to help organizations identify AI systems, assign ownership, assess risk, establish oversight, and create a repeatable governance process aligned with the NIST AI Risk Management Framework. FRAME includes an AI System Inventory, Governance Policy, System Risk Assessment, Implementation Guide, and Getting Started Guide to help organizations build a scalable governance program.

“The organizations that succeed with AI will not necessarily be those deploying the most AI. They will be the organizations that can demonstrate governance, accountability, transparency, and oversight.” Thank you, Brian… read the full VieauxPoint article.

Capital Markets

The U.S. and Iran announced an interim agreement to reopen the Strait of Hormuz and begin 60 days of negotiations over Iran’s nuclear program, though significant uncertainty remains as the details have yet to be finalized and hundreds of vessels remain stranded in the Persian Gulf. Markets responded positively, with oil falling to a three-month low, stocks and Treasuries rallying on easing inflation concerns, and investors rotating back into risk assets. May's economic data pointed to a modest loss of momentum, with industrial activity flattening after a strong April while manufacturing sentiment and homebuilder confidence both weakened, suggesting higher rates and economic uncertainty continue to weigh on growth-sensitive sectors. Remember, markets continue to view geopolitical developments and energy prices (not economic data) as the primary drivers of near-term Treasury and risk-asset performance.

While a potential U.S.-Iran agreement has supported risk sentiment and lower rates, caution remains warranted; Agency MBS appear inexpensive relative to investment-grade corporates but slightly rich to Treasuries, with Fannie Mae 15-year and Ginnie Mae 30-year pools offering some of the best relative-value opportunities.

Last week was a good one for borrowers, whose rates are driven by Agency MBS. MBS generated 25 basis points of excess return with every trading session finishing positive. Performance was led by Fannie Mae 20-year securities, while volatility fell to its lowest level since early May and current-coupon spreads tightened, with higher-duration coupons benefiting from a 5-basis point decline in the 10-year Treasury yield. Within the sector, investors are favoring higher-coupon and longer-duration exposure, though conventional 6.5s have lagged due to roll weakness.

All eyes are on Kevin Warsh as he leads his first Federal Reserve meeting this week, with markets expecting rates to remain unchanged but closely watching his guidance on inflation, future policy, and the Fed’s independence. Stronger job growth and elevated inflation have strengthened the case for tighter policy, but the Fed is expected to signal patience as much of the recent inflation pressure stems from energy prices and tariffs. The FOMC is also expected to maintain a wait-and-see stance on future rate moves. Updated economic projections are likely to show higher inflation expectations, a slightly lower unemployment outlook, and a slight shift toward the possibility of future rate hikes.

Today’s economic calendar kicked off with May Housing Starts (1.18 million, expected 1.44 million, 1.47 million prior), and Building Permits (1.41 million as expected). We’ve also received May Import Prices (+1.9 percent versus 1.9 percent previously), and Export Prices (+1.3 percent versus a prior reading of 3.3 percent). Housing data was mixed. Starts and building permits were expected to hold on trend and point to subdued building this summer. Later today brings an auction for $13 billion of 20-year U.S. Treasury bonds. We begin Tuesday with Agency MBS prices slightly improved from Monday’s close, the 2-year yielding 4.05, and the 10-year yielding 4.44 after closing yesterday at 4.47 percent.