I was today years old when I realized that the shovel was literally a groundbreaking invention. The best ads and marketing focus on rates and products, right? Wrong. From Florida, Todd P. reminds me of a powerful, memorable lending ad that doesn’t even mention words like mortgage or loan or technology or lending. What message are you sending to potential clients? Loan officers are intent on offering the right products, service, and pricing to clients (read the piece on optimism below), but there is a lot going on “out there” that is impacting the psychology of borrowers. Beginning on Friday, all international merchandise headed to U.S. customers’ doors, assuming that countries are shipping it to us, will be subject to the overall tariff rate that their country of origin has been slapped with, or close to it, meaning pretty much any good your client orders could cost them at least 10 percent more than it does now. And in a mix of technology news, a bank fired a set of workers, and then rehired them after it was determined that the chatbot was terrible at its job. Go figure. (Today’s podcast can be found here and this week’s is sponsored by Arrive Home. Arrive Home, now serving six of the nation’s top 10 mortgage lenders, helps mortgage lenders connect creditworthy buyers with down payment assistance and affordable homeownership solutions. Hear an interview with Experian’s Alison Bird and Joy Mina on how streamlining the verification process helps lenders serve more borrowers without sacrificing accuracy.)

Products, Services, and Tools for Lenders and Brokers

Have borrowers been held back by high DTI, low down payment, or locked-up equity? With Flyhomes Buy Before You Sell, you can help them buy with $0 down, make stronger, cash-like offers, unlock equity upfront (no monthly payments), and reduce DTI & qualify for up to 50 percent more. You stay the broker of record, and we make the financing work. Over the past 10 years, Flyhomes has helped 5,000+ buyers move into their next home. On average, LOs close 1.2 more loans per month with Buy Before You Sell, now available in 30+ states. Book a call today to learn more.

“AI is rewriting mortgage technology faster than vendors can ship updates. The risk isn’t just higher SaaS costs… It’s falling behind. With Automatic Lender, you don’t wait on the roadmap. You own it. We build custom mortgage software that leverages AI where it matters most: software you own, you control, and that’s built around your business, not someone else’s roadmap. That means point-of-sale systems built precisely to your use case, intelligent document processing that classifies and routes docs automatically, advanced knowledge assistants that deliver instant answers from guidelines and SOPs, cognitive AI agents that analyze data and take action, automated AI marketing systems, and compliance checks that run in real time to keep audits painless. The result is lower cost, more control, and a competitive edge that lasts. If you’re ready to stop renting generic systems and start owning your future, schedule a free 30-minute discovery call. Learn more here or contact Nick. nick@automaticlender.com.”

Leads to Locks Lookbook: Your Guide to Better Lending! Stop leaving deals on the table. Drawing from analysis of over 1 billion credit records, this lookbook combines the fundamentals of credit, real LLPA case studies, and proven optimization strategies to help you spot opportunities others miss. Download Now!

ICYMI: Optimal Blue has officially announced the dates for its 2026 Summit, set to take place February 23 – 25 at Talking Stick Resort and Conference Center in Scottsdale, Arizona. According to the news release, the client-exclusive event will bring together capital markets professionals, integration partners, and mortgage industry insiders for three days of strategic insight and innovation. The Optimal Blue Summit will feature early access to the company’s latest generative AI and automation tools, expert-led sessions covering pricing, trading, compliance, and consumer engagement, and hands-on demonstrations of new capabilities. CEO Joe Tyrrell emphasized the company’s commitment to delivering real solutions, stating that every session is designed to help lenders and investors gain a competitive edge and drive measurable results. Early bird registration is now open at Summit.OptimalBlue.com. Attendance is limited, so clients are encouraged to register early to secure their spot.

QC doesn’t have to feel like a never-ending game of whack-a-mole, with errors popping up faster than your team can smack them down, spreadsheets multiplying, and deadlines slipping further away. AuditGenius by Indecomm changes the game with a smarter, sharper approach to quality control. With pre-fund automation, intuitive workflows, customizable reporting, and interactive dashboards, AuditGenius gives you the visibility and control you have been missing. Instead of reacting to problems, your team can focus on preventing them and turn QC into a driver of improvement rather than a drain on resources. With Fannie Mae’s new QC requirements taking effect September 1st, the time to modernize is now. Smarter feedback loops, cleaner data, and deeper loan insights mean fewer surprises, stronger compliance, and a team that stays ahead of the curve. Don’t play games with compliance. Attend the upcoming AuditGenius demo and experience QC precision!

Norm! Here’s something else turning heads these days: 53 percent of surveyed lenders say they save up to 10 hours per new program rollout using Down Payment Resource (DPR). That’s because standardization and automation are the real showstoppers. With DPR’s full-service platform as your internal orchestrator for down payment assistance (DPA), rollouts stop being reactive and start being reliable. Want to see this crowd pleaser in action? Join DPR’s Brad Cardwell at TMC’s upcoming Boston conference, where he’ll present a Partner Showcase on Tuesday, Sept. 16 at 9:30 a.m. ET in Room 2. Book your seat in advance and make your next DPA rollout feel as smooth and familiar as sitting with Norm, Cliff, and the rest of the belly-up gang “where everyone knows your name.” (And at the TMC “family reunions,” that sentiment certainly holds true as well.)

The Chrisman Marketplace is 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.

FEMA Latest

Lenders and servicers have entire sets of policies and procedures based on the Federal Emergency Management Agency (FEMA) declaring an emergency in a given area. Abolishing FEMA won’t change the weather, or the human toll, and their impact on families, lenders, and servicers. The weather-related events in Texas (severe storms, straight-line winds, and flooding) has led to FEMA declaring certain counties disaster areas: DR-4879-TX. A disaster declaration triggers policy and procedure changes in lenders, servicers, and vendors. President Trump says FEMA should be eliminated, which would definitely impact this process. Texas officials weren’t fans of FEMA until they needed it.

FEMA disaster declarations include New Mexico (DR-4886-NM, DR-4886 Amend #1, and DR-4886 Amend #2) and Texas (DR-4879-TX, DR-4879 Amendment #1, DR-4879 Amendment #5, and DR-4879 Amendment #6).

PHH Mortgage posted multiple Disaster Alert Announcements regarding New Mexico, DR-4886 and Texas, DR-4879. Go to the PHH Mortgage company library to view the information within the Announcements.

On August 16, 2025, with Amendment No. 1 to DR-4886, FEMA granted Individual Assistance to New Mexico county Dona Ana. View AmeriHome Mortgage Disaster Announcement 20250803-CL.

On 8/19/2025, with Amendment No. 2 to DR-4886, FEMA identified an Incident Period End Date of 8/5/2025 for New Mexico counties affected by severe storms, flooding, and landslides from 6/23/2025, to 8/5/2025. See AmeriHome Mortgage Disaster Announcement 20250804-CL for inspection requirements.

Four additional Texas counties, Guadalupe, Kimble, McCulloch, and Menard, were.

granted individual assistance with amendment #5 to DR-4879. View AmeriHome Mortgage Disaster Announcement 20250712-CL for additional information.

On 7/31/2025, with Amendment No. 6 to DR-4879, FEMA identified an Incident Period End Date of 7/18/2025 for Texas counties affected by severe storms, straight-line winds, and flooding from 7/2/2025, to 7/18/2025 and continuing. View AmeriHome Mortgage Disaster Announcement 20250715-CL for inspection requirements.

LOs and Optimism in the Face of Adversity

Over the weekend I received an “MLO VieauxPoint” from Brian Vieaux, CMB, President & COO of FinLocker & Founding ‘Expert’ of MLO Live, suggesting that loan officers should be a positive beacon for their clients, co-workers, and referral partners.

“After three decades in this business, I’ve seen how one Fed speech can shift the tone of an entire industry. Chairman Powell’s remarks at Jackson Hole last Friday may not have promised the fast rate cuts many were hoping for, but the signals were clear: relief is on the horizon. Inflation is easing, the economy is stabilizing, and the path forward points to lower rates in time.

“Here’s the important takeaway for loan officers. As Robbie Chrisman noted on Last Word, mortgage rates may not drop immediately. Markets have already priced in much of this expectation. But that doesn’t mean this isn’t good news, it just means it’s time to lead with positivity, not predictions.

“Our industry is flooded with headlines focused on what’s broken. Your community needs something different. They need a trusted guide who shows up with clarity and encouragement, even when the news cycle is gloomy. That’s where you come in. Share optimism with your Realtor partners. Post something hopeful for clients who feel stuck. Be the voice that reminds people the American Dream isn’t dead, it’s just underprepared.

“When uncertainty dominates the headlines, the loan officers who step up as beacons of calm and confidence are the ones their communities remember. You don’t control the Fed. But you do control how you show up. Read my full article here: Positive Beacon Your Community Needs.” Thank you, Brian! #VieauxPoint

Cost Per Loan

I received this question. “Rob, are production costs still north of $10k per loan? How can that be?” Indeed, it is. In fact, the most recent figures from the Mortgage Bankers Association showed total loan production expenses (commissions, compensation, occupancy, equipment, and other production expenses and corporate allocations) decreased to $10,965 per loan in the second quarter, down from $12,579 per loan in the first quarter of 2025, according to the Mortgage Bankers Association’s (MBA) newly released Quarterly Mortgage Bankers Performance Report. At least we’re moving in the right direction.

Independent mortgage banks (IMBs) and mortgage subsidiaries of chartered banks reported a pre-tax net production profit of $950 on each loan they originated in the second quarter of 2025, compared to a net loss of $28 per loan in the first quarter of 2025. Including all business lines (both production and servicing), 80 percent of the firms in the report posted pre-tax net financial profits in the second quarter of 2025, up from 58 percent in the first quarter of 2025.

“IMB net production income reached its highest level since the fourth quarter of 2021,” said Marina Walsh, CMB, MBA’s Vice President of Industry Analysis. “The seasonal pickup in purchase volume, and the average number of production employees decreasing from last quarter, led to production costs dropping by more than $1,600 per loan. At the same time, average loan balances reached a study-high, resulting in an increase in gross production revenue.” Added Walsh, “Servicing net financial income improved slightly, as impairments on mortgage servicing rights were minimal. Combining production and servicing operations, 80 percent of mortgage companies in the sample posted overall profits, the highest percentage since the third quarter of 2021.”

Mr. Cooper Acquisition Approved

U.S. Federal Housing, in keeping with its statutory responsibilities as conservator of Fannie Mae and Freddie Mac (the Enterprises), yesterday allowed both Enterprises to approve Rocket Companies’ proposed acquisition of Mr. Cooper Group, subject to appropriate conditions to ensure the ongoing safety and soundness of Fannie Mae and Freddie Mac.

The Agency’s safety and soundness staff conducted a rigorous analysis of the proposed merger of two of the Enterprises’ largest individual seller-servicer counterparties. Staff independently recommended that the Enterprises approve the combined entity to do business with them so long as Fannie Mae and Freddie Mac each retain strict counterparty concentration risk limits at 20 percent and impose other appropriate financial and operating safeguards to protect the Enterprises and the mortgage market. No market participant should have greater than 20 percent of Fannie or Freddie’s servicing market in order to ensure the safety and soundness of the mortgage market and the overall economy.

Yesterday’s decision ensures the housing finance system can continue to develop and innovate while Fannie Mae and Freddie Mac are able to confidently serve as an ongoing source of liquidity to the market throughout the economic cycle.

Capital Markets

It’s still early in August’s economic data cycle but a common theme we’ve seen is the deterioration of labor market conditions. The labor market is clearly weaker than the Fed initially thought as it was setting policy over the past several months. The scenario of falling demand for workers, along with falling supply is an unusual one: part of the issue in the labor market is cyclical and some will be structural as AI decreases demand for white collar workers. 100 basis points of cuts to the fed funds rate won't do anything for the structural component, but it can ease the cyclical component.

Recall that a couple of weeks ago, the University of Michigan Sentiment survey showed a bounce in year-ahead unemployment expectations (62 percent of respondents expect a rise in unemployment over the coming year, substantially higher than the pandemic-era high of 52 percent). The August employment report and August CPI releases will be the last big pieces of the Fed’s policy calculus puzzle to fill in prior to September 17. Before then, this week brings a few important data reports. The headliners will be the July consumer spending and PCE deflator figures due out Friday.

Bond prices were mixed from the start yesterday after some more potential tariff-related developments: President Trump threatened to impose additional tariffs on exports from countries that have digital service taxes and warned that a 200 percent tariff on imports from China could be implemented if China does not accelerate exports of rare-earth magnets. Tariffs will cause some inflation for sure, but a big question is how much? No one knows because that is a function of how much gets absorbed by foreign entities selling into the US market, how much gets absorbed by U.S. producers who face higher input costs, how much companies shift around suppliers to minimize the tariff effect, whether consumers substitute U.S.-made products for foreign ones, etc.

Economic data yesterday included a Durable Orders report for July (-2.8 percent, though not as bad as expected), while August Consumer Confidence was also better than expected even though it showed an increase in year-ahead inflation expectations to 6.2 percent from 5.7 percent. Consumer confidence remained range-bound in August at levels not typically associated with robust spending but not linked with sharp pullbacks either; the trend descent in consumers' assessment of the present situation goes hand in hand with the cooling labor market. U.S. house prices rose 2.9 percent between the second quarter of 2024 and the second quarter of 2025, according to the U.S. Federal Housing House Price Index (FHFA HPI). House prices for the second quarter of 2025 remained unchanged compared to the first quarter of 2025.The U.S. Treasury’s $69 billion 2-year note sale met solid demand, though foreign interest remained below average.

And now to what everybody is talking about: President Trump’s attempts to skew the FOMC’s monetary stance and membership to favor his policy priorities. Put more nicely, this White House is turning over every stone to see where the levers are to change the Fed. While Governor Cook’s lawyer says the President has no grounds to fire her, and she refused to accept the termination, it is still a developing story. Trump doesn’t need to fully clear house to get the rate cuts that he wants, because ousting Governor Cook could be worth a lot more than one additional Trump-appointee on the FOMC. Specifically, a Trump-aligned board majority (four of seven seats) could block the reappointment of the regional Fed presidents when their terms expire this upcoming February. As a reminder, the Federal Open Market Committee, which is responsible for setting interest rates, also includes five regional bank presidents who (unlike the governors) aren’t nominated by the White House or confirmed by the Senate.

Today’s economic calendar is mostly about Treasury supply, but first the MBA released mortgage applications for the week ending August 22, which decreased 0.5 percent from one week earlier. Following last Friday’s Powell-inspired rally, the 10-year yield fell 7-basis points week-over-week to 4.26 percent, while the benchmark 30-year mortgage rate from Mortgage News Daily eased 4-basis points to 6.52 percent, a new YTD low. For the same period, FNMA’s Refinance Application-Level Index declined 9.9 percent by dollar volume and 9.7 percent by loan count, though are respectively 17.3 percent and 12.0 percent higher from a year ago. Treasury activity today will be headlined by a $28 billion auction of reopened 2-year FRNs followed by $70 billion 5-year notes. Today’s single scheduled Fed speaker is Richmond Fed President Barkin. Dow component Nvidia reports earnings after the close. We begin Wednesday with Agency MBS prices slightly worse than yesterday’s close, the 2-year yielding 3.65, and the 10-year yielding 4.29 after closing yesterday at 4.26 percent.