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The Federal Housing Association is likely to continue to take market share away from the private mortgage insurers for the foreseeable future, a Keefe, Bruyette & Woods report said.Insurance-in-force for all forms of mortgage insurance grew by 1.3% between the first and second quarters and by 5.5% year-over-year, the report from Bose George and Tommy McJoynt said.However, FHA had 9.7% annual growth, versus just 1.6% annual growth for the private MIs, continuing a trend since mid-2023. When compared with the first quarter, FHA's IIF increased 2.3%, while it only rose by 0.4% for the private MIs.Dollar amount of loans with mortgage insuranceFor all forms of mortgage insurance, IIF is $3.14 trillion, with the private companies holding $1.59 trillion of the total.PMI is mostly used on conforming mortgages, with $1.4 trillion of its IIF on Fannie Mae and Freddie Mac loans, U.S. Mortgage Insurers said.The share of PMI relative to FHA has declined 440 basis points since the third quarter of 2022, to 50.7% of the market, from a peak of 55.1%."We expect PMI IIF growth to remain muted through 2027, reflecting the slow recovery in the housing market," the KBW analysts said.How many consumers used PMI last yearUSMI annual data showed use of its members' product has slipped in line with total mortgage origination volume.In 2021, nearly 2 million borrowers used private MI; for the same year, industry volume was $4.4 trillion, according to the Mortgage Bankers Association.The number of private-MI-using borrowers fell to 1 million the following year and to around 800,000 in both 2023 and 2024. Originations in those years were $2.25 trillion, $1.64 trillion and $1.78 trillion respectively, MBA said.Insurance-in-force at the PMIs rose by 8.1% before falling to 2.9% and then 1.9% over that same time frame, the KBW report noted.Why FHA will grow faster than private MI"We expect FHA growth to outpace PMI growth in a higher-for-longer environment as FHA volume continues to benefit from affordability-related factors such as more volume from some large builders and GSE-to-FHA cash-out refinance debt consolidation volume," George and McJoynt noted.The July MBA forecast predicts the 30-year fixed will average 6.7% in the fourth quarter, before falling to 6.6% in the first quarter of next year and ending 2026 at 6.4%. For 2027 it expects the 30-year to average 6.3%.In July, KBW reduced the ratings on three of the five private MIs it covers (Radian, Essent and NMI Holdings) and now sees their respective stock prices as "market perform." Arch is covered separately as it has other lines.But the analysts still remain bullish on the business in general going forward. Each of the companies remained profitable during the second quarter.How much will private IIF grow through 2027?For this year, KBW predicts the private MIs IIF will grow by 2%, with 3% increases in each of the following two years. The MBA origination outlook is for $2 trillion this year, $2.2 trillion in 2026 and $2.3 trillion in 2027.The restoration of the mortgage insurance premium deduction should not have create any meaningful shifts in market share, as it is an across-the-board action, covering not just PMI and FHA, but also other government-guaranteed products including Veterans Affairs and U.S. Department of Agriculture mortgages.But one potential disrupter for the MI companies is the Federal Housing Finance Agency's pronouncement that conforming lenders can use VantageScore 4.0 on loans sold to the GSEs. The MIs have to adapt their systems to underwrite these loans, just as lenders will.

If you’re hoping for lower mortgage rates, you might be thrilled to hear what Treasury Secretary Scott Bessent has to say.During a television interview today, he said “a series of rate cuts” could be on the table, including a big 50-basis point cut in September.That would mirror the cut seen last September when mortgage rates happened to go up. Of course, the Fed and mortgage rates have a complicated relationship.So those who think Fed cut = lower 30-year fixed might be in for a surprise.However, Bessent added that the September cut could be the first of many…Bessent Says Rates Should Be 150 to 175 Basis Points LowerSpeaking today on Bloomberg, Treasury Secretary Bessent argued for bigger rate cuts than what’s currently forecast.For starters, he believes the September Fed rate cut, currently a lock at 99.9% on CME, should be not 25 basis points but instead 50 basis points.The backdrop there is that he suspects we could (should) have cut back in June and July, but didn’t. So in essence playing a little bit of catch up.Of course, this is all predicated on that really ugly jobs report we got for July, which included massive downward revisions for June and May.Had that not come, it’d be hard to fathom anyone talking about a 50-bp rate cut, or perhaps even a 25-bp rate cut.In fact, CME had odds of a quarter-point rate cut at just 57.4% one month ago, just to illustrate how fluid this all is.Now there’s word of removing the monthly jobs report until it can be proven to be accurate.This was a suggestion from E.J. Antoni, who replaced fired Bureau of Labor Statistics (BLS) commissioner Erika McEntarfer after that mess of a report.But Bessent believes that’s just the start, and that “we should probably be 150, 175 basis points lower.” Whoa!The Fed Funds Rate Isn’t Mortgage RatesI’ve said this a million times, but it bears repeating. The Fed doesn’t set consumer mortgage rates.When they cut, mortgage rates could go up, sideways, or down. Same if they hike. The correlation isn’t all that strong.The only real argument you can make is Fed rate expectations correlate somewhat with mortgage rates.So if they’re planning to cut, long-term mortgage rates can drift lower too. But, and it’s an important but, you need the economic data to support the move lower.While the Fed could feasibly cut its own fed funds rate, it’s unclear how bond yields would react, especially without a monthly jobs report leaving them in the dark.Bonds are supposed to be a safe haven, and with so much uncertainty in the air, it’d be hard to imagine any major movements there until there’s more clarity.However, the 10-year bond yield did slip nearly six basis points today, which might be a reflection of reduced inflationary fears related to tariffs.That would put all eyes on the labor market, which is what got this latest mortgage rate rally going in the first place.And could be the underlying reason why folks like Bessent are calling for these sizable rate cuts.Is Bessent signaling that not all is well in the economy, even if the administration argues that the economy is hot?Ultimately, continued job losses and higher unemployment is what would get mortgage rates even lower.It’s clearly a double-edged sword, as you’d have more households under stress, which kind of takes away from the expected windfall of lower rates.But that’s kind of the thing with rates. They tend to come down with bad economic times and vice versa.Mortgage Rates Already Lowest Since Early OctoberAs it stands now, 30-year fixed mortgage rates are the lowest they’ve been since early October. They’re nearly back to September levels, per MND.So Fed rate expectations and weak economic data might already be mostly baked in. Rates can go lower, but need a reason (even more economic weakness).Maybe they’ll get back there this September, when the 30-year fixed was hovering closer to 6% than 6.5%.That would certainly lead to a pick up in mortgage refinancing, and potentially home buying as well.We saw a mini refi boom back then, which only got cut short due to a hot jobs report, ironically.Perhaps we are unwinding that move a year ago and getting back to the narrative that the labor market is cracking and the economy is cooling.All this despite fears of inflation rising again due to tariffs, or simply more businesses raising prices as they manage rising costs.This is where that stagflation idea comes in. Slowing growth, higher unemployment. It’s certainly possible.But it appears this administration, who is also looking to make the Fed a lot more accommodative once Powell’s term is over, is fixated on cutting rates.If nothing else, this means HELOC rates will come down, as they are directly tied to the prime rate, which is dictated by the federal funds rate.It could also make adjustable-rate mortgages cheaper, as they are short-term loans unlike the 30-year fixed.The big question is if this policy direction puts us at greater risk of inflation reigniting. Or if the administration sees the writing on the wall, that the economy is in dire need of support. Before creating this site, I worked as an account executive for a wholesale mortgage lender in Los Angeles. My hands-on experience in the early 2000s inspired me to begin writing about mortgages 19 years ago to help prospective (and existing) home buyers better navigate the home loan process. Follow me on X for hot takes.Latest posts by Colin Robertson (see all)

Young homebuyers are taking the adage "marry the house, date the rate" to heart, but that could set them up for potential problems in the future, a new report warns.Nearly two-thirds of millennial and Gen Z homebuyers said it was "important" or "extremely important" that they be able to refinance their homes in the next three years, according to a new survey from Truework, an income and employment verification website. That compares to 56% of all homebuyers and is double the number of baby boomers who said they would need to do so.Millennials and Gen Z homeowners appear to have a higher risk tolerance, often accepting less-than-ideal mortgage rates with the intention of refinancing later.This could be a risky decision, though, said the report's authors. For one, the market is unpredictable, and there's no guarantee that rates will go down significantly or that other costs won't go up. For another, homeowner finances change. Borrowers may lose their job, see their pay cut, or run into credit problems between the first loan and the refinancing."When I consult clients about a refinance, I always tell them, 'know the numbers,'" said Todd Carson, director of sales performance at Planet Home Lending. "A 1% rate reduction may serve as a broad benchmark, but in practice, every homeowner's financial picture is unique."Many homebuyers are also blindsided by unexpected costs, the survey found. Nearly a quarter of respondents said they were surprised by the extent of the "other costs in the process," such as inspections and closing costs. These struggles continued even after they left the closing table, with 17% saying that their biggest financial difficulty was paying for "unexpected repairs." This issue was most pronounced for Gen Z and millennial buyers.Besides closing costs and repairs, rising insurance rates are also weighing on household budgets, with the average homeowner's insurance premium spiking more than 9% since last year. In a survey of homeowners, 57% said they would consider selling their home if insurance rates rose.The Truework report pointed to "industry-wide communication failures" in helping first-time homeowners, especially younger ones, understand the true costs and risks that come with buying a home. They raised a red flag regarding the increasing tendency for younger buyers to rely heavily on refinancing. The authors warned this could create "systemic vulnerabilities" that could have broader economic implications.Hope for new homebuyersWhile fears around affordability weigh heavily on the minds of younger homebuyers, new data from the National Association of Realtors offers some hope.While home prices rose in 75% of markets nationwide in the second quarter of this year, this is down from the first quarter, when prices rose in 83% of markets, according to the NAR's Housing Affordability Index. The median price of a single-family home moved up 1.7% year-over-year, a slowdown from last quarter when prices increased 3.4%.There were huge regional variations in this, though. In the Northeast, prices were up more than 6%, triple the nationwide average. The West, meanwhile, saw only a slight bump of 0.6%, and in the South, prices remained flat. This tracks with other recent reports which found that increasing supply and falling demand have led to cooling home prices in these regions."Home prices have been rising faster in the Midwest, due to affordability, and the Northeast, due to limited inventory," said NAR chief economist Lawrence Yun in a statement. "The South region – especially Florida and Texas – is experiencing a price correction due to the increase in new home construction in recent years."Data also shows that first-time buyers are paying 6% less in mortgage payments than they were a year ago for a starter home, and many are also spending a smaller percentage of their income on their mortgage.

US mortgage rates dropped last week by the most since February, enticing homeowners to step up refinancing.The contract rate on a 30-year mortgage declined 10 basis points to 6.67% in the week ended Aug. 8, according to Mortgage Bankers Association data released Wednesday. The rate on a 15-year mortgage retreated below 6% for the first time in four months — matching the lowest level since October.READ MORE: Economists now leaning towards September Fed cutMortgage rates tend to track moves in the Treasury market, and the yield on the 10-year note tumbled at the start of the month in the wake of weak employment data. That report, which included downward revisions to prior months, boosted the odds that the Federal Reserve will lower interest rates next month.MBA's measure of refinancing jumped 23% from the prior week to the second-highest level since early October. The index of home-purchase applications rose a more modest 1.4%.A sustained decline in home-financing costs would help breathe fresh life into a struggling housing market. However, stubbornly high mortgage rates and steadily rising home prices have buffeted a resale market where purchases are hovering near 15-year lows. For first-time homebuyers, the National Association of Realtors affordability index is near the lowest in records back to 1986.READ MORE: Mortgage rates drop to lowest level this summerThere are, however, indications of modest relief in the housing market. According to real estate brokerage Redfin, the income needed to afford a home has declined in 11 of the 50 most populous US metropolitan areas compared to last year.Builders, meanwhile, are using a variety of incentives to help reduce a multiyear high in new-housing inventory.The MBA survey, which has been conducted weekly since 1990, uses responses from mortgage bankers, commercial banks and thrifts. The data cover more than 75% of all retail residential mortgage applications in the US.

While more economists surveyed in August by Wolters Kluwer expect the Federal Open Market Committee to cut short-term rates at its September meeting than the previous month, a significant share still thinks action won't come until December or later.The percentage of the participants in the Blue Chip Economic Indicators panel believing the next Fed Funds Rate reduction will take place in September grew to 60% from 55% in July's survey. In the July survey, one respondent forecast a rate cut at that month's meeting. The FOMC is next scheduled to meet on Sept. 16 and 17, with future meetings on Oct. 28 and 29 and Dec. 9 and 10.How many economists think the Fed will waitWhile 7% are now of the opinion the cut will take place in October, 26% think it will occur at the December meeting and 7% responded "later."Last month's survey had 10% expecting a cut in October and 33% stating it would happen later.Nearly all of the panelists are looking at a 25 basis point reduction, with just 2% stating it would be a 50 basis point cut.While the report notes some "downward surprises" were found in "certain economic data" over the prior month, the BCEI showed little change in response.What is the impact of tariff policyIf anything, "the outlook brightened slightly in some respects," Wolters Kluwer said. "The modest change in the outlook probably reflects sharp adjustments that had been made in earlier months when concern about Pres. Trump's reciprocal tariffs was deep."Participants likely were of the opinion that they already built in sufficient downside risks on the economy and upside risks on inflation into their individual forecasts, the report continued.How the CPI news influences the chances of a rate cutThe survey, released on Aug. 11 was taken prior to the release of the Consumer Price Index data on Tuesday. The report from the Bureau of Labor Statistics found the seasonally adjusted month-to-month increase to be 0.2% and the unadjusted annual rise of 2.7%."The upshot of these numbers is that the bet on a September cut by the Fed jumped to over 90% from less than 84%, and the bet for another cut in October jumped to 62%, and for three cuts by year's end is now over 48%," Louis Navellier, an investment banker, said in a commentary on Tuesday morning.Following the CPI news, the 10-year Treasury yield, which is a benchmark for mortgage rates, was at 4.3% as of 12:30 p.m. eastern time., a gain of 3 basis points from its previous close. The 10-year has been trending higher again since closing at 4.2% on Aug. 5.How much will the Fed cut rates this yearThe consensus for the decline in the FFR is 51 basis points in the August BCEI survey, which is a 4 basis increase versus July's 47 basis point expectation.Even with the continued noise from President Trump and others in his administration about the future of Fed Chair Jerome Powell, 86% of the economists are of the opinion he will remain through the end of his term.When asked if the U.S. is likely to have a recession in the next 12 months, 40% of the panelists responded in the affirmative.Nearly all the panelists have included the tax bill and its implications in their forecasts. Just more than half, 55%, believe the legislation is simulative to the U.S. economy, with another 34% stating it would have a neutral effect. Just 11% feel it would restrict economic growth.

Takeaways:Sen. Schiff reintroduced the proposal previously raised in the HouseAPCIA official points to other causes for rate increasesBill doesn't answer funding and conditions questions, legal expert saysA reintroduced proposal for a federal catastrophic reinsurance program is stalled in the U.S. Senate, as it attracts industry criticism. Sen. Adam Schiff (D-Calif.) The Incorporating National Support for Unprecedented Risks and Emergencies (INSURE) Act introduced by Sen. Adam Schiff (D-Calif.) on July 17 is a new version of H.R. 6944, a bill of the same name introduced by Schiff on Jan. 10, 2024, when he was a representative in the House in the previous term. That bill never went beyond the House Financial Services Committee. Sam Whitfield, senior vice president of federal government relations, APCIA.LinkedIn A statement by Sam Whitfield, senior vice president of federal government relations at APCIA, the insurance industry's trade association, said the new version of the INSURE Act shifts insurance risk to the government and taxpayers without solving the reasons for rising insurance prices. According to Whitfield, increased prices are caused by demographic shifts, rising property values, inflation of repair costs, lawsuits against insurers and delayed approvals for rate increases.Schiff's bill is meant to address California's wildfire-fueled insurance crisis in particular, according to his statement in a press release. "Too many families and small businesses are struggling to keep up with the rising costs of insurance, and steep year-after-year price increases are simply unsustainable," he stated. A federal risk reinsurance pool would lower costs and make insurance coverage more affordable, he added.Whitfield said the bill forces Americans in low-risk states to subsidize higher risks in other states, including hurricanes, floods, tornadoes and hail. H. Michael Byrne, partner in the insurance practice at McDermott Will & Emery LLP.© Gittings Photography According to Michael Byrne, partner in the insurance practice at McDermott Will & Emery LLP, the INSURE Act would subsidize insurance pricing without basing the pricing on risk. The proposal, Byrne said, doesn't indicate how it would be funded and what the conditions would be for participation in a reinsurance pool. Byrne pointed to ongoing issues with funding the National Flood Insurance Program (NFIP), which barring further action will run out of funding on September 30. Federal catastrophic reinsurance would face the same issue, he said. As of March, NFIP's debt to the U.S. Treasury stood at $22.5 billion. "It's just the same playbook that doesn't work. Government should not be in the business of insuring things that the private market can write," Byrne said. "I certainly don't know how you do the economics of that without the input of private industry, because otherwise, you're just competing with them."Schiff's bills are not the first time a federal catastrophic reinsurance program has been proposed. In January 1999, House Rep. Rick Lazio (R-N.Y.) introduced the Homeowners Insurance Availability Act, which was placed on the calendar for debate in March 2000, then saw no further action.

It’s no secret that banks have lost interest in mortgage lending in recent years.It has become very much dominated by nonbanks, companies that do not accept customer deposits or keep loans on their books.Facilitating this trend has been the originate-to-distribute model, where mortgage companies make loans only to sell them off shortly after.In the past, banks would actually keep the loans they made, but it has become a lot less common these days.This may explain why the top three mortgage lenders last year were all nonbanks.Chase Leads the Banks in Mortgage Lending NationwideI was curious to know which banks were dominating the mortgage space, despite ceding a lot of ground to nonbanks in recent years.Easily leading the pack was NYC-based Chase Bank with about $38 billion in lending volume last year, per HMDA data.They were followed by U.S. Bank with $26.0 billion and Bank of America with $23.3 billion.Rounding out the top five were former mortgage behemoth Wells Fargo and Citibank.Investment bank Morgan Stanley also made the list, as did Citizens Bank, PNC Bank, Flagstar, and Huntington.While the numbers look okay, they pale in comparison to the nonbanks.Top lender United Wholesale Mortgage (UWM) funded $137.8 billion while Chase only managed $37.5 billion.Despite UWM working exclusively with mortgage brokers, they outperformed the top bank by a staggering $100 billion.The nation’s second largest lender, Rocket Mortgage, did about 2.5X the volume of Chase too.And even lesser-known CrossCountry Mortgage outpaced Chase by a couple billion as well.Of course, we can’t blame Chase because they were still the top bank mortgage lender in the country.Where were all the other banks? The answer: further down the list. Including former #1 Wells Fargo, who barely made the top-20 with a paltry $20 billion funded.In total, nonbanks more than doubled the home loan production of the banks last year.They funded $1.1 trillion in home loans versus just $491 billion for the banks.It makes me wonder what would bring the banks back to mortgage, if anything.Why Don’t Banks Want to Make Mortgages Anymore?Earlier this year, WaFd Bank exited mortgage entirely, and their CEO said one the reasons why is that mortgages have become a commodity.In other words, everyone just makes the same old 30-year fixed backed by Fannie Mae, Freddie Mac, or Ginnie Mae (FHA/VA loans).You can go anywhere and get the same product, and it’s pretty much all government-backed, either explicitly or implicitly in the case of Fannie/Freddie.At the same time, the nonbanks sell off all the loans they originate while the banks often hold onto them.They do so despite not getting any additional business from the customer, who can also easily refinance their mortgage at any time and move away from the bank.The WaFd CEO basically summed it by calling it a bad business, riddled with credit risk and interest rate risk. And because there’s no loyalty in today’s world, why bother?Chase CEO Jamie Dimon Doesn’t Appear to Like Mortgages EitherWhile Chase is seemingly sticking with it, their CEO Jamie Dimon recently said they probably lost money on mortgages over the past 50 years.He even went so far as to refer to the mortgage business as a “sh*tty business,” despite his bank ranking #1.Why would he feel that way? Well, aside from claims to have lost money, he grumbled about the many rules and regulations tied to home loan lending.Perhaps that was his way of hoping they ease up and make it easier for the banks, who knows?But Chase is still plugging away and leading the nation in mortgage, partially thanks to their acquisition of First Republic after it failed in 2023.The SF-based bank was a major jumbo loan lender that served ultra-wealthy clients, so Chase has undoubtedly gained volume from that pick up.However, Chase only managed to place fourth on the list of top mortgage lenders last year.Whether they look to make up ground remains unclear. Perhaps just being a megabank gets them that level of volume without too much effort.Speaking of, Chase recently touted discounted mortgage rates for a limited time to drum up business. So who knows where they really stand on mortgages. Before creating this site, I worked as an account executive for a wholesale mortgage lender in Los Angeles. My hands-on experience in the early 2000s inspired me to begin writing about mortgages 19 years ago to help prospective (and existing) home buyers better navigate the home loan process. Follow me on X for hot takes.Latest posts by Colin Robertson (see all)

The impact of Trump-era tariffs on goods and services is starting to trickle through the economy, but for now, the effect on inflation appears minimal, raising expectations for a potential interest rate cut in the near term.The July Consumer Price Index, released Tuesday, showed headline price growth of 2.7% over the previous year, the same as the month prior. Core CPI, which excludes food and energy, rose to 3.1%, up from 2.9% in June. The readings were relatively consistent with forecasts.Prices for some goods and services, including transportation and medical care, have shown signs of increasing. But items affected by tariffs, such as autos and major appliances, have yet to show an impact, as businesses opt to shield customers from price hikes.Members of the Federal Reserve's rate-setting committee, including Fed Chair Jerome Powell, have voiced reluctance to cut rates in light of tariffs, citing uncertainty about how levies on imports will impact the economy.Last month, Powell said the Federal Open Market Committee likely would have cut rates already this year had it not been for uncertainty around tariffs and other policy developments involving immigration and government spending.With inflation data showing muted movement and concerns mounting over a weakening labor market, the balance of the central bank's dual mandate of price stability and full employment may be shifting, according to Dawit Kebede, senior economist at America's Credit Unions."July prices increased in line with expectations, with the items most likely to be impacted by tariffs either rising at a slower rate or remaining flat compared to June's print," Kedebe said Tuesday in a statement. "Given the weakening labor market and restrictive monetary policy, the Federal Reserve will most likely cut rates in September. Markets are already pricing in a higher probability of this move."Fed Vice Chair for Supervision Michelle Bowman, in a recent speech, noted that she foresees three interest rate cuts this year, a view recently bolstered by most recent data about the labor market.The latest employment report, which showed that employers added just 73,000 jobs in July — a figure below the pace seen in recent months — is grounds to shift the Fed's monetary policy from restrictive to neutral, Bowman said. "In terms of risks to achieving our dual mandate, as I gain even greater confidence that tariffs will not present a persistent shock to inflation, I see that upside risks to price stability have diminished," Bowman said on Saturday, speaking to the Kansas Bankers Association. "With underlying inflation on a sustained trajectory toward 2%, softness in aggregate demand, and signs of fragility in the labor market, I think that we should focus on risks to our employment mandate."Though the likelihood of an interest rate cut appears to be growing, one regional Federal Reserve bank president signaled caution Tuesday about easing monetary policy. Federal Reserve Bank of Kansas City President Jeff Schmid said he thinks it's too early to change approaches. Speaking at the Southern Economic Development Council Annual Conference in Oklahoma, Schmid highlighted "a modestly restrictive policy stance" as the appropriate reaction to recent inflation data."While increased tariffs seem to be having a limited effect on inflation, I view this as a rationale for keeping policy on hold rather than an opportunity to ease the stance of policy," Schmid said.

Since taking on responsibility for all Selene Holdings' business lines earlier this year, Chief Strategy and Growth Officer Doug Whittemore has been focused product development and scale by drawing on his 25 years of bank and nondepository experience.Whittemore — who previously led teams at U.S. Bank, JPMorgan Chase, Mr. Cooper and Citibank — said he's focused on helping the Selene achieve scale while addressing diverse needs clients of the servicing, diligence and title solutions provider have."Doug, a seasoned veteran in the industry, brings over two decades of leadership experience in mortgage banking, default servicing operations and strategic growth," Selene CEO Joe Davila said in a press release announcing Whittemore's appointment in May. "His experience leading major strategic initiatives will play a crucial role in Selene's continued advancement in innovation to meet the needs of today's market and tomorrow's opportunities." In a conversation with National Mortgage News, Whittemore weighed in on the distinct needs of loans that lie outside the qualified mortgage definition, and those that are non- or reperforming. He also discussed technology such as artificial intelligence, industry best practices. In addition, Whittemore talked about how he works in partnership with Selene Finance President Jocelyn Martin-Leano, who bears responsibility for oversight of that unit's operations and also joined the company earlier this year.His remarks on all these topics, edited for clarity and length, follow.

Home lending credit reversed course following a one-month dip, with availability returning to the upside even as conforming product offerings declined in July, according to the Mortgage Bankers Association.  The MBA's credit availability index edged up 0.2% month over month to a reading of 103.9. The score rose from 103.7 in June, which was the first credit pullback in seven months. Compared to July 2024's reading of 99.1, the latest figure was also 5.9% higher. The MCAI was benchmarked in 2012, with a score of 100 reflecting conditions in March that year. Higher numbers point to rising availability, while lower scores indicate credit tightening. Growth among jumbo and adjustable-rate mortgages offset the contraction in conforming credit, as lenders also originated a noticeable number of ARMs in recent weeks, MBA said. "This development was consistent with a steeper yield curve and the jumbo-conforming spread back in negative territory. The average jumbo rate was around 8 basis points lower than the average conforming rate in July. MBA vice president and deputy chief economist Joel Kan said in a press release. Adjustable-rate borrowers responded to the rate developments to drive seasonally adjusted growth of 24.2% in ARM applications for much of the past month, according to MBA's most recent weekly mortgage lender survey. ARM applications also garnered an 8.5% share of activity relative to total volume at the end of July. ARM interest surged in the latter half of the month after spending much of the summer with shares in a range of 7% to 8%. How conventional product availability grewThe rise in jumbo availability pushed the conventional subindex 0.5% higher from the previous month. Like the overall MCAI, conventional credit data, similarly, headed upward again after a June drop. Of the two contributing components in the conventional MCAI, jumbo lending saw an 0.9% increase from June to July to make up for the 0.5% fall in conforming credit. "Credit availability of conforming loans declined slightly over the month, mostly due to a pullback in renovation loans," he noted.Government-backed credit sees further pullbackProduct availability shrank in the government-lending segment, consisting of loans backed by federal agencies. The 0.2% monthly drop continued trends observed earlier this summer. MBA previously noted fewer government products on offer, with mortgage industry concerns about the repayment ability among borrowers with lower credit scores playing a role. Downward movement in July's government MCAI, though, came in more muted than the prior month's 1.7% fall. With lower balances, loans guaranteed by government agencies will typically have smaller balances and offer options to borrowers with a limited credit history.