Tomorrow is the 4th of July, the only time of the year Americans say the day and month in the correct order. We find ourselves in the traditional “dog days of summer” which refer to the hottest and most uncomfortable days typically occurring from July 3 to August 11 in the Northern Hemisphere. Did someone say “dog”? Thank you to David I. who sent along a story about how inflation shows up in the price of hot dogs at the yearly Coney Island display of gluttony. While President Trump continues to publicly berate Fed Chair Powell (but can’t fire him), it is important for lenders to remember that though the economic data is all backward looking, the economy is currently too strong to justify Fed rate cuts, given the inflation risk, or at least the volatility of tariff decisions. So, we sit. Besides, the bond market will move before the Fed. (Today’s podcast can be found here and this week’s is sponsored by Figure, which is shaking up the lending world with their five-day HELOC, offering borrower approvals in as little as five minutes and funding in five days. Figure has hundreds of partners in the banking, CU, home improvement, and (of course) IMB space embedding their technology, giving borrowers an experience they will rave about. Today’s has an interview with Optimal Blue’s Jeff McCarty on the growing importance of integrated, data-driven tools in secondary marketing to improve pricing precision, risk management, and efficiency, particularly as market volatility, product diversity, and AI adoption reshape the hedging and trading landscape.)

Products, Software, and Services for Lenders and Brokers

Celebrating America this July 4th? Whether you're road-tripping cross-country or staying local, remember: NFTYDoor is available in all 50 states for Wholesale Brokers and Correspondents. This Independence Day, support your fellow Americans by helping them access their home equity, on demand. Whether it’s debt consolidation, home improvement, or large expenses, you’re giving them financial flexibility when they need it most. At NFTYDoor, we don’t just offer a best-in-class digital HELOC. We back it with A+ support for both you and your clients. Because helping Americans thrive is what we’re all about. Fast. Simple. Profitable. Connect with your Homebridge Wholesale or REMN AE, or email seth@nftydoor.com, and we’ll get you set up today.

A cicada spends years underground, then bursts onto the scene making more noise than anything its size should be capable of. It’s not a bad comparison for Partners Bank’s new mortgage division. VP of Mortgage Lending Jim Carroll started it from scratch last year with no legacy systems, no bloated team, and no time to waste. And now, with help from Friday Harbor’s AI-powered Originator Assistant, Partners Bank is taking loans from application to closing in as few as 7 days. Read the case study to see why Jim calls Friday Harbor “an LO assistant, an underwriting guide and a compliance checker rolled into one.” Turns out, making noise in the mortgage business doesn’t take years… It just takes the right tech partner.

The Chrisman Marketplace is now “up and going,” a centralized hub for vendors and service providers across the mortgage 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.

Another Bank/Builder Alliance

Houston’s Cornerstone Capital Bank and Idaho’s Tresidio Homes announced the launch of Table Rock Mortgage. “This innovative joint venture combines Cornerstone's exceptional track record of nearly 40 years in home lending excellence with Tresidio Homes' reputation as a five-star-rated home builder in Treasure Valley. Cornerstone is known for its award-winning culture, its industry-leading expertise in mortgage joint venture management and compliance, and its suite of lending programs and financing solutions that help home builders sell more homes.

“The new Idaho-licensed mortgage brokerage will provide comprehensive mortgage services to local homebuyers. Table Rock Mortgage represents a promising partnership between Cornerstone and Tresidio Homes, with goals of promoting affordability and streamlining the mortgage process for homebuyers… Table Rock Mortgage will broker a diverse range of loan products, including conventional and government-backed loans, serving first-time homebuyers, move-up buyers, veterans, and seasoned purchasers.”

Customer Service = New Compliance Strategy

As regulatory pressure eases, banks face a new kind of scrutiny, one driven by rising client expectations and real-time service standards. In her timely piece, Why Superior Client Service Is the New Compliance Strategy in a Deregulatory Era, Katie Wilson argues that trust is no longer earned through box-checking but through seamless, transparent, and proactive service. With fintechs encroaching and traditional oversight loosening, institutions that treat service as a strategic function, not a support role, will be the ones that thrive. Read on to discover why in today’s banking landscape, service is the strategy.

Thoughts on MISMO

Why Should Mortgage Loan Officers Care About MISMO? Most Mortgage Loan Officers have no idea what MISMO is or how deeply it affects the tools they use every day. In his latest thought leadership piece, Brian Vieaux shares key insights from the recent MISMO Summit in Boston, making a compelling call for MLOs to get involved in shaping the future of mortgage tech. From smoother system integrations to influencing the digital mortgage landscape, your voice matters more than you think.

Capital Markets

I was in the audience when John Williams, President of the NY Federal Reserve, spoke about fiscal policy, trade policy, geopolitical events. Spoiler alert: Rates are right where they need to be. Inflation is creeping down, and the effect of the tariffs remains to be seen. Mr. Williams said that some of the “forward” surveys are concerning. Business surveys, especially those impacted by trade, have been all over the map and many aren’t in the hard data yet, surprisingly.

Recall that imports during the 1st quarter jumped, not because the economy was doing well, but because of front-loading as large retailers purchased items in advance, and/or used bonded warehouses for handling goods.

Consumer spending is a huge question. All of the surveys are showing more uncertainty, with greater thoughts about downsizing, nationwide that sometimes translates into action.

Mr. Williams reminded the audience that the amount of data that the Fed has at its disposal is amazing. Shrinking the Federal Reserve’s balance sheet, reducing its holdings of MBS by over $2 trillion, and doing so in a predictable, well-telegraphed manner which the markets can digest is something that the Fed is doing. Its MBS portfolio is falling by $15-20 billion a month, and letting things roll off for the foreseeable future is entirely expected.

The U.S. housing market is still impacted by supply and demand factors. Supply is a multi-decade problem, regardless of segment, although affordability is the current problem most often discussed. The Fed is seeing stakeholders at the community level coming together to help address affordability problems, which in turn is caused by high demand. Pragmatic solutions are not easy to find. The Federal Reserve doesn’t set housing policy and jobs and inflation are the overriding areas of focus of the Fed.

Turning to the day-to-day bond market activity, yields rose across a steepening Treasury curve yesterday despite a surprisingly weak Automatic Data Processing (ADP) Employment Report showing a 33k job loss in June private-sector payrolls. Though this was well below expectations for a 98k gain, the lack of market movement suggests that investors are holding off on major conclusions until today’s more comprehensive Employment Situation Report.

Although there is little doubt that the Bill won’t pass, attention also turned to the stalled “One Big, Beautiful Bill” in the House amid GOP cost concerns. Meanwhile, President Trump announced a new trade agreement with Vietnam featuring a 20 percent tariff on Vietnamese imports and zero-tariff U.S. access to Vietnamese markets. The labor market slowdown, particularly in the services sector, has raised concerns about broader economic weakness ahead of the July 9th tariff deadline.

Recent commentary from Federal Reserve officials suggest that tariff-related inflation has thus been milder than initially feared, with little evidence of significant price pressures materializing so far. This, combined with Fed Chair Powell's softer tone during public remarks made earlier this week, has led markets to interpret the Fed’s stance as increasingly flexible, especially after Powell refrained from directly opposing the idea of a July rate cut.

Given recent market behavior, only a significantly weak jobs number (read: below 50k) would meaningfully shift sentiment toward a July rate cut, especially with a 23 percent chance of that move already priced in. One soft payrolls print alone isn’t likely to prompt Fed action, it would take a benign June CPI as well to push policy makers toward easing this month. Keep in mind that the timing of both reports allows room for the Fed to adjust messaging if needed.

With a holiday-shortened week, key data including the trade deficit, jobless claims (233k), and the June payrolls report (nonfarm +147k, stronger than expected, the unemployment rate is down to 4.1 percent, better than expected, hourly earnings were +.2 percent) were all released together this morning. Most economists believe that an unemployment rate above 4.5 percent would justify a July cut.

Later today brings S&P Global services PMI, the ISM equivalent, May factory orders, Treasury announcing the auction sizes for next week’s refunding supply (consisting of $58 billion 3-year notes, $39 billion reopened 10-year notes, and $22 billion reopened 30-year bonds), Freddie Mac’s Primary Mortgage Market Survey, and remarks from Atlanta Fed President Bostic. Bond futures will settle at 1:00pm ET and 2:00pm ET for cash, per SIFMA's recommendation for an early closure ahead of tomorrow's full closure for Independence Day. After the first volley of data, we begin the last day of this trading week with Agency MBS prices worse by .25-.5, depending on coupon and maturity, from Wednesday’s close, the 2-year yielding 3.90, and the 10-year yielding 4.35 after closing yesterday at 4.29 percent.