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A worker operates a forklift at a fulfillment center in Elizabeth, New Jersey.Eilon Paz/Bloomberg Shorter-term Treasuries, which are most sensitive to expectations for Fed policy, led the slump. Two-year yields rose almost 10 basis points, while 10-year rates jumped 6 basis points to 4.34%. The dollar advanced versus its major counterparts."The Fed will take the summer off," said Gregory Faranello, head of US rates trading and strategy for AmeriVet Securities. "The needle for the Fed to move was employment" and this report gives Fed Chair Jerome Powell room for a wait-and-see approach to easing policy.Interest-rate swaps showed traders saw almost no chance of a Fed rate reduction at the July 29-30 meeting, compared with the roughly 25% probability seen before the report. The chance of a move in September was reduced to about 75%.Payrolls increased 147,000 after slight upward revisions to the prior two months, and compared with a median forecast of 106,000 in a Bloomberg survey. The unemployment rate fell to 4.1%, from 4.2%.But private payrolls rose just 74,000 in June, the least since October and largely due to health care. The figures are consistent with a moderation in hiring as employers grapple with President Donald Trump's erratic trade policy and await congressional approval of his signature tax legislation.Jeffrey Rosenberg, portfolio manager at BlackRock Inc., said investors may have overreacted given the slowdown in private payrolls. "This is a great example of where the first reaction is not necessarily the last reaction," Rosenberg said on Bloomberg Television. "Private payrolls disappointed to the downside. This is the slowing in the job market that we're expecting."Treasuries had rallied in recent weeks, bringing the 10-year benchmark down from around 4.6% in May, on expectations that a softening labor market would give policymakers the data they need to resume monetary easing. Bond traders have been ramping up long positioning in Treasuries, leaving the market open to rounds of short-term profit squeezes. The market started to entertain the probability of a Fed rate cut as soon as this month after two Fed governors — Christopher Waller and Michelle Bowman — said they were open to the move, depending on data. Speaking this week, Powell reiterated that the Fed is waiting to see the effects of Trump's tariffs, but refused to rule out the possibility of a cut in July. Expectations for Fed cuts this year have waxed and waned since December. But policymakers' median forecast — which didn't change in March and June — was that the band would decline to 3.75% to 4% by the end of the year, implying two quarter-point cuts.Interest-rate swaps showed that traders are penciling in a total easing of 52 basis points this year — in line with the Fed's median forecast. Prior to the job report, traders had priced in almost 70 basis points of easing for the year.  The jobs report has arguably been the most influential piece of economic data for bond traders in recent months, often generating outsize moves. Two-year yields, which are the most sensitive to the Fed's policy, have moved an average 10 basis points on the day of the payroll releases over the past year, twice the size of movements on the days of consumer price index releases.

Real estate platform Flyhomes is turning its focus toward wholesale lending after offloading its home-search portal in an acquisition deal.The Seattle-based technology firm announced the sale of its consumer-facing home search portal to The Real Brokerage earlier this week. The sale comes just a little more than a year after Flyhomes amped up home search functions by incorporating artificial intelligence through its acquisition of a Sam Altman-backed startup.  Terms of the deal were not disclosed, but the agreement includes an equity investment by the real estate firm into Flyhomes to support its "evolution into a wholesale mortgage lender." With the acquisition, Real will offer Flyhomes' loan products via its mortgage subsidiary. "We're also excited to offer Flyhomes' buy-before-you-sell products through One Real Mortgage, giving our agents and their clients more flexibility and control on their path to homeownership," said Real CEO Tamir Poleg in a press release. Launched in 2016 as a real estate brokerage and affiliated mortgage company, Flyhomes touted the search portal's multiple listing service integrations and real-time market insights. The company was among the pioneers to establish a business strategy aimed at helping consumers find properties and act quickly in hot housing markets. The strategy included buy-before-you-sell purchase loans, which turned into its flagship mortgage offering. "As we focus on scaling our buy-before-you-sell financial products nationwide through the wholesale mortgage channel, we made the strategic decision to transition the portal and the team to the best environment for continued growth," said Flyhomes co-founder and CEO Tushar Garg.The company also offers a program that helps buyers make all-cash offers, allowing for almost immediate purchases upon approval. Buyers used its all-cash option in more than 1,800 deals, which helped lead to over $6 billion in transactions, Flyhomes said on its website.    In a message to customers posted on its website, Flyhomes announced the portal would cease operating on July 2. How the housing market affected company fortunesAs Flyhomes shifts focus entirely to mortgage lending, it encounters a housing market that remains stubbornly sluggish, but also offers pockets of opportunity for its type of products. While the company's debut was well timed to capitalize on the housing boom characterized by high demand and multiple bids on properties earlier this decade, volatile mortgage rates in 2022 and 2023 sent both buyer interest and loan origination volumes plunging. Thirty-year fixed rates have remained between 6% and 8% since the second half of 2022, more than double their level in late 2021.Moderating home prices today are skewing the market in buyers' favor in many parts of the country as well, with higher inventory volumes giving them more time to act. At the same time, though, other markets still remain competitive and see prices continue to accelerate. Current trends appear to support the growth of the buy-before-you-sell mortgage segment, as sellers remain reluctant to sell a home with contingencies allowing a buyer to back out of a sale, according to Jason Lindwall, president of Move Concierge. "We're coming off a market where you couldn't have any contingencies," said Lindwall, whose company helps buyers transition into new residences when relocating. "I think that's still in play right now. No one wants to take a contingent sale."The 2025 business environment is also leading to mortgage consolidation that illustrates the extent to which lenders are trying to create a one-stop homebuying model that captures the borrower at the point they express interest. While the recently closed merger between Rocket Cos. and Redfin dominated headlines, mergers involving other companies were aimed at building out buyer-to-borrower pipelines that could present challenges for independent real estate brokers and lenders.Joining the list of lenders with buy-before-you-sell products this year was Rocket, which unveiled its bridge financing option in June to provide flexibility for customers with associated mortgage loans.How the buy-before-you-sell space has developedFlyhomes managed to raise $310 million in venture capital funding between 2017 and 2021, the year of its last funding round, according to Crunchbase. Listed among its investors are Andreesen Horowitz and Battery Ventures. While some of Flyhomes' peers in the startup scene with similar products eventually folded or merged into other companies, the lender also saw heightened competition arrive as both long-established mortgage businesses and fintechs came out with cash or buy-before-you-sell offerings to tap into the growing segment.Although downsizing may be viewed by some as a step back, the terms of Flyhomes' portal sale offers the company solid benefits as it looks to grow as a mortgage lender, Lindwall said.   "It's great because they're going to get access to the buyers that are on the Real network," he said.

Newrez, which does business as Shellpoint Mortgage Servicing, has filed a trademark infringement lawsuit against a firm with a name "confusingly similar" to the d/b/a it has used for years.David George Novelli, a California resident, owns Shellpoint Mortgage Servicing LLC, according to the U.S. District Court complaint filed this week in South Carolina. Novelli's company is registered in Charleston, South Carolina.The plaintiff said in the lawsuit that the defendant's use of the Shellpoint name leads to "confusion in the community (legal and otherwise) by creating the false and mistaken impression that the infringing entity is affiliated, connected, or associated with Newrez."Pennsylvania-based Newrez has used the Shellpoint name since acquiring an entity using it. Newrez became aware of Novelli's Shellpoint in early 2025, when the former company realized that legal records and other mail were going to the wrong organization, court documents show. The plaintiff claims it has not received "pre-litigation documents," including legal demands from borrowers and their counsel. The confusion has impacted Newrez's ability to resolve disputes, according to the lawsuit.Newrez said it has used the trade name Shellpoint for more than a decade in commerce in South Carolina and across the United States, while the owner of the other firm registered his company in June 2023, court documents show.The Rithm affiliate has spent "time, money, and resources" marketing and promoting products and services under the name Shellpoint, so the existence of a firm going by a similar name is "injurious to consumers and homeowners," the legal filing notes. Newrez is asking for the federal court in South Carolina's Columbia to grant it undisclosed damages and block the outside firm from using the Shellpoint name. The plaintiff also wants to get its hands on any legal documents that have been accidentally sent to the other firm, and have the defendant provide an "accounting of all services furnished and products sold" under the Shellpoint Mortgage Servicing LLC name.Novelli could not immediately be reached Wednesday. Recent trademark infringement lawsuits filed in the industry include a federal case Mortgage 1 Inc. filed in January against a similarly-named company that spelled out the numeral. Mortgage One Funding is the defendant in that case.In addition, Loandepot sued two organizations in 2024 for allegedly having similar logos to its real estate services platform, mello.The litigation against Flashhouse LLC real-estate platform fello has been settled. The second complaint against Melio, a payment platform app, was still pending at the time of this writing.

A side effect of the rising costs of homeowners' insurance is that mortgage borrowers elect to reduce coverage or take a higher deductible in order to reduce premiums.In either case, such actions could leave them underinsured and/or unable to finance repairs. This increases borrower default risk for mortgage servicers, and affects the value of their collateral.This year, 71% of over 1,000 homeowners who participated in a survey from insurance brokerage Guardian Service said they were postponing renovations or repairs due to economic uncertainty.By generation, millennials had the highest share, 74%, who said they would put off essential repairs, followed by baby boomers and Gen Z, both at 71%, and Gen X at 67%.Why are Gen Zers impacted most by rising home costsBut the Gen Zers are likely the most susceptible in this situation, given the affordability challenges they already had to overcome to purchase a property in the first place. This is why several have turned to house hacking for example.Mortgage borrowers are supposed to have reserves, money set aside to cover emergencies, whether job loss or damaged properties. Yet some have argued those should even be higher than current guidelines.The average U.S. homeowner has delayed a needed repair by 8.4 months. Approximately 15% said they are putting off major upgrades indefinitely, with one-third willing to wait at least one-to-two years.Home improvement budgets were 42% lower this year. Higher mortgage rates and property taxes, the hidden costs of homeownership, were making maintenance more difficult for 40% of respondents.But Gen Z in particular was impacted, as 59% stated those higher costs affected their ability to care for their properties.Knowledge gap is affecting homeownersThe survey also found that nearly 23% of respondents did not file an insurance claim because they were worried the condition of their home could trigger an inspection or result in a coverage denial. For Gen Z, this ratio rose to one-third, Guardian Service said."A surprising 20% of homeowners were unaware that putting off repairs could negatively affect their property's value or insurability," the report said. "For some, the consequences are already hitting home — 13% said they've had trouble renewing their homeowners' insurance, while 11% were charged higher premiums because of damage or outdated features."Just under half of those surveyed said they were not aware that upgrades to their home could lower their premiums; for the Gen Z cohort only, this was 55%.Almost 70% of all respondents said lower inflation would make them feel financially ready to make repairs or renovations. Meanwhile, a lower cost of building materials was cited by 65%, while reduced tariffs on imported building materials was the response of 43%.Lower mortgage rates are not as much of a motivator, cited by only 27% of the respondents.

Left to right: Elizabeth Blosser, Emily Tryon, Kevin Cameron The American Land Title Association recently elevated three executives to advance the trade group's advocacy efforts in state and federal government. The association promoted Elizabeth Blosser to chief strategy, communications and innovation officer, a role which will have her lead initiatives that will help shape the future direction of the title industry. Blosser steps into the c-suite after previously working primarily with state officials as a vice president of government affairs.ALTA also elevated Emily Tryon to chief advocacy officer to lead legislative and regulatory priorities through correspondence with officials at all levels of government. She most recently handled federal advocacy also as a vice president of government affairs. Advancing to a vice president role and as head of federal government affairs is Kevin Cameron, who will be in charge of ALTA's work in Washington and within the executive branch. Cameron will also manage grassroots advocacy efforts. He formerly held the title of senior director, working in federal advocacy.

Federal Reserve Chair Jerome Powell, left, and President Trump in 2017.Bloomberg News Try as they might, President Donald Trump and his allies have not been able to harangue the Federal Reserve into lowering interest rates. But that doesn't mean their rhetoric isn't getting results. Trump's desire for lower rates — and a more compliant central bank — have sent a clear signal to the financial sector and economic actors more broadly that more accommodative Fed policy is coming, one way or another. "The market is thinking that, if Trump gets his way, then even if [Fed Chair Jerome] Powell holds through the end of this year or cuts rates slowly, by the end of next year, the picture is going to look a lot different, because Trump wants rate cuts come hell or high water," said Derek Tang, CEO and co-founder of the Washington-based research firm Monetary Policy Analytics.Trump is no novice when it comes to decrying the central bank, having done so multiple times through his first presidential term and repeatedly through his most recent electoral campaign. Now, his appointees and some members of Congress are joining him in scrutinizing Powell. During a pair of appearances on Capitol Hill last week, Powell faced lawmaker questions about whether the Fed's reluctance to cut rates was a symptom of his own political leanings. Some also grilled him on cost overruns related to the Fed's ongoing building renovations in Washington.On Wednesday, Federal Housing Finance Agency Director Bill Pulte, the administration's leading Fed attack dog and rate cut advocate, called for a congressional investigation into Powell for what he deemed "deceptive" responses to Senate Banking Committee questions about the renovation project."I am asking Congress to investigate Chairman Jerome Powell, his political bias, and his deceptive Senate testimony, which is enough to be removed 'for cause,'" Pulte said in a written statement, adding that Powell's responses under oath amounted to "nothing short of malfeasance and is worthy of 'for cause.'"By invoking removal, Pulte's statement alludes to another tool in Trump's Fed-pressure utility belt: the threat — real or implied — of termination. The president has stated that he is not seeking to remove Powell from office and the Fed chair has said he is in no danger of being ousted. Even so, the administration's track record of breaking from institutional norms leaves the possibility squarely on the table.Thus far, Trump's pressure campaign has not swayed policymakers at the Fed. Last month, the Federal Open Market Committee held interest rates unchanged for the fourth consecutive meeting, with Powell attributing uncertainty about the potential inflationary impacts of new tariff policies as a driving factor in the committee's May and June decisions. Powell has maintained that he is comfortable holding rates where they are until the committee is confident tariffs will not reignite inflation, or data shows a steep drop-off in economic activity or employment. He has also been adamant that political commentary, even from the president, plays no role in the Fed's decision-making. "The things that matter are using our tools to achieve the goals that Congress has given us, maximum employment, price stability, financial stability," Powell said during a public speaking engagement this week. "That's what we focus on 100%."Yet, recent weeks have seen rate cut expectations increase, especially looking into next year, according to the CME Group's Fed Track tool, which policy outcome probabilities based on 30-day Fed futures contracts. As of Wednesday, nearly three-quarters of market participants expect a full percentage point of reduction by next year's June FOMC meeting, compared to less than half on June 18. Likewise, 44% of the market expects five or more rate cuts within the next year, more than double the amount that did two weeks ago.Yields on 10-year Treasury notes have also been trending down. After surging to more than 4.5% in May — as bond investors demanded a higher premium for long-dated government debt — yields have come down to about 4.25%. Michael Redmond, a U.S. policy economist for Medley Global Advisors, said this level of interest rates signals that markets are not being spooked by the president's jawboning against the Fed."That's a little bit surprising, given how aggressive the President's rhetoric has been and what seems to be a game plan that they're laying out for … selecting somebody for the opening board seat in January," Redmond said, referring to Fed Gov. Adriana Kugler's term, which expires next year. Redmond said the dynamic behavior either indicates that the investors and traders agree with Trump's view of where policy should go, or they are confident that the other members of the FOMC will be able to keep the president's next appointee — who could well take over as Fed chair when Powell's term expires next summer — sufficiently in check."It's not possible for Trump to get the majority of FOMC voters in essentially one term," he said. "So there are safeguards on how much interest rates can be lowered."But Trump is not starting from scratch in his effort to assemble a more sympathetic FOMC. Two committee members, Fed Gov. Christopher Waller and Vice Chair for Supervision Michelle Bowman — both of whom were appointed during Trump's first stint in the White House — have stated their preference to cut rates as soon as this month.Tang said the supportive statements from Waller and Bowman have set Trump's latest bout of Fed bashing apart from previous episodes. The president also has economic data on his side. Unemployment has remained near historic lows and inflation is trending toward the Fed's 2% target. Even Powell acknowledged on Tuesday that the Fed likely would have cut rates already this year were it not for trade policy uncertainty."It does seem like market expectations for next year have moved lower," Tang said. "That might have to do with the data, it might have to do with the fact that the committee — Waller, Bowman and maybe a few others — are turning towards the labor market mandate more, and also to do with Trump's comment. It's a combination."Yet, while the Fed voices calling for rate cuts have grown louder in recent weeks, there is a stark divide forming within the FOMC. While most participants favor lowering rates at some point this year, a growing number — seven out of 19 — called for no change to the federal funds rate this year, according to the committee's latest quarterly summary of economic projections. Based on this, Redmond said it is unlikely that Trump gets the full two-percentage-point lowering of the federal funds rate that he's been calling for. But, Redmond noted, if tariff-induced inflation does not materialize soon, the cut-averse hawks on the FOMC might be outmaneuvered by their more dovish counterparts."The pressure is building on the Fed to prove that there's going to be some inflationary problems from tariffs, and, if not, to start moving with trade cuts relatively soon," he said.

Santander Bank is sponsoring the issue of its third non-qualified mortgage (non-QM)/investor loan securitization this year. The bank is a mortgage loan aggregator that predominantly focuses on non-agency loan aggregation and securitization. The Santander Mortgage Asset Receivable Trust 2025-NQM3 will issue notes totalling $283.64 million. The sponsor and seller is Santander Bank, the depositor is Santander Mortgage Asset Dispositor, and the trustee is Citibank.The loans' main originators are HomeXpress Mortgage Corp. and OCMBC (LoanStream). The primary servicer is Selene Finance, the special servicer is Fay Servicing, and the master servicer is NewRez.The notes are backed by first-lien, fixed- and adjustable-rate, fully amortizing residential mortgage loans, some with interest-only periods, according to S&P Global Ratings. The loans have an average seasoning of four months.The 665 properties in the pool are geographically well diversified and consist of single-family residential, townhouses, planned-unit developments, condominiums, and two- to four-family residential. The loans are non-qualified mortgage/ability-to-repay-compliant (ATR-compliant) and ATR-exempt loans. Investor loans account for 46.42% of the pool. These loans were issued using Debt Service Coverage Ratios (DSCR).S&P says that it considers the collateral in the pool to be non-prime. It notes that, although the collateral pool is weaker than that of a prime pool, its credit quality is generally in line with expectations for a non-prime residential mortgage pool.The pool's weighted average original loan-to-value ratio is 72.49%, which S&P says is better than archetypal home equity ratios. The loans' weighted-average FICO score of 731 is also better than archetypal scores.S&P's ratings for the senior notes are AAA for classes A-1, A-1A, and A-1B; AA for A-2; and A for A-3. Mezzanine M-1 notes are rated BBB, and subordinate notes are rated BB for B-1, B for B-2. The remaining notes are unrated.Credit enhancement for the rated notes is provided by subordination of notes that are lower in the payment priority, according to S&P. In the interest payment waterfall, interest and interest shortfall amounts are allocated sequentially to the class A-1A, A-1B, A-2, A-3, M-1, B-1, and B-2 notes.There is also excess spread, which can be used to pay accumulated interest and principal shortfalls. The credit enhancement varies between 30.2% for class A-1 notes and 1.8% for class B-2. 

The Consumer Financial Protection Bureau has concluded a 2024 action it took against nonbank mortgage company Fay Servicing under a former director in line with a broader rollback of enforcement under new leadership."The bureau waives any alleged noncompliance by Fay Servicing with the consent order," read an order that Russell Vought, the CFPB's current acting director, authorized. The new order leave consumer redress and a monetary penalty involved in placeThe move releases Fay from an order it felt forced into a "business decision" to sign off on despite disagreement with claims of new violations and issues related to compliance with a prior 2017 settlement involving dual tracking claims. CFPB also had previously terminated the 2017 order, which a company spokesperson had said that year involved "isolated" and "technical" claims that "concern a small fraction" of Fay's borrowers. Richard Cordray headed the bureau back then.(Dual tracking prohibitions governed by the Real Estate Settlement Procedures Act's Regulation X and other consumer protection laws are designed to prohibit situations where companies simultaneously pursue a foreclosure path while evaluating borrowers for alternatives.)Fay issued statements on Wednesday showing appreciation for the CFPB's termination of the 2024 consent order and noting that the company is "committed to the highest standards of compliance and borrower care."A company spokesperson added that its legal representative, Michelle Rogers of Cooley LLP, confirmed that the CFPB dismissed the 2024 consent order.Fay agreed to pay a $2 million civil money penalty and $3 billion consumer redress as part of the 2024 consent order. It also agreed to spend $2 million on compliance management and technology last year, an expenditure there was no mention of in the termination order.Vought said in his order that Fay had satisfied the first two obligations and that the bureau would be distributing the redress to consumers.Other CFPB actions walked back at mortgage lenders and banksThe CPFB has dismissed several previous actions against companies in the housing finance industry and other business sectors, including lawsuits against Rocket and Vanderbilt Mortgage,  and a $95 million overdraft settlement with Navy Federal.The bureau also withdrew an amicus brief supporting plaintiffs suing Mr. Cooper for charging $25 for expedited payoff quotes, and has signaled that it could take larger deregulatory actions such as axing the loan officer compensation rule.The tax bill the Senate recently passed, which is going through a budget reconciliation process with the House, would gut the CFPB's funding in line with longtime Trump administration aims.States remain active in nonbank mortgage servicer oversightWhile the Trump administration has largely defanged the bureau, there are widespread expectations certain state regulators like California's Department of Financial Protection or the New York Department of Financial Services could look to fill in the gap.Although only 11 states have completely adopted the Conference of State Bank Supervisors' prudential standards for nonbank mortgage servicers. CSBS considers 99% of the market covered by them due to multistate examinations, according to Kevin Byers, a senior director.Arkansas, Colorado, Connecticut, Georgia, Iowa, Maryland, Minnesota, Montana, Nevada, North Dakota and Wisconsin have signed on in whole and North Carolina may follow. There's partial adoption in Oregon and Washington. New York's standards are considered similar.

I was thinking about mortgage rates, as I often do, when I decided to pose a question to Grok, the LLM chatbot owned by xAI.So many folks debate which way interest rates are going that I decided to just ask the chatbot instead.Why bother debating with humans when I can just ask the super intelligent computer to spit out an answer for me based on data.Specifically, I asked the following: “Is there a higher likelihood of U.S. mortgage rates being higher or lower than current levels by December 31st, 2025?”And lo and behold, Grok told me “the consensus leans toward a modest decline.”A Modest Decline for Mortgage Rates?In what felt like a pretty safe answer (apparently chatbots are so like us), Grok summed up a much longer response I won’t bore you with by saying a “modest decline” was likely.This modest decline was based upon “expert forecasts” from about a dozen institutions and economists, including the likes of Fannie Mae, the Mortgage Bankers Association, NAHB, NAR, Wells Fargo, and several others.Grok arrived at the answer by taking an average of all these forecasts it compiled, noting that most of them ranged from 6.1% to 6.6% by December 31st, 2025.Given that the current 30-year fixed rate is 6.77%, according to Freddie Mac (who incidentally doesn’t have a forecast), this would indicate that we’re going lower by year end.Among the forecasts cited, S&P Global’s 5.5% rate was considered the biggest outlier (pretty bullish), while a website called Long Forecast has a year-end rate of 6.69%, which is closest to current levels.The average among all the forecasts cited in the answer was roughly 6.3%, which suggests a clear downward bias from today’s rates.In fact, it’s about a half-point lower than current rates, which is decently lower, but I suppose still modest in nature.What’s the Case for Lower Mortgage Rates by Year End 2025?Grok came up with a list (surprise surprise) of five things that could push mortgage rates lower by December.They include:– Fed rate cuts– Economic slowdown– Geopolitical stability– Housing market pressure– Mere probabilityThe first is two (or even three) expected rate cuts, which I’ll remind everyone the Fed doesn’t set mortgage rates.Sometimes its own monetary policy aligns with long-term rates, but there’s no direct correlation. Their policy only direct impacts the prime rate for HELOCs.However, if they are cutting, chances are there is an economic slowdown as well (#2 on the list).This could support lower 10-year bond yields, which would translate to lower 30-year fixed mortgage rates as well.That’s what many are banking on as inflation continues to slow and unemployment continues to rise.Next up is geopolitical stability, which Grok believes would keep demand up for U.S. bonds, and thus bring down yields.Simply put, bonds are safe haven assets, and a place to park money when times are uncertain.Next up is a deteriorating housing market, which could push lenders to offer lower rates to drum up demand.I’ve explained before that it could be opportunistic to apply for a mortgage when lenders are slow because they tend to pass on more savings.So all in all, decent rationale for lower rates.What’s the Argument for Higher Mortgage Rates in December?On the other side of the coin, we have the following reasons why mortgage rates could end 2025 higher:– Persistent inflation– Strong economy– Fiscal deficit concerns– Geopolitical escalationIf inflation does pick up again, perhaps due to tariffs and fiscal spending, the Fed may hold off on rate cuts.At the same time, bond buyers may demand a higher yield to buy government debt.Similarly, if the economy remains robust, that too could put pressure on bonds and push yields (and mortgage rates) higher.There’s also the government spending bill, which will likely require more bond issuance, with greater supply leading to lower prices and higher yields, all else equal.And finally, if the geopolitical situation worsens, you could have a situation where bond yields rise and/or oil prices go up. That could potentially lead to higher interest rates, or at least not lower ones.But this scenario is still much less likely than rates being lower, as explained above.So if we’re banking on the consensus, mortgage rates should be lower by the end of 2025.Not significantly lower, but perhaps around .50% lower than current levels, which could be bullish for the housing market.It could also allow some existing homeowners to refinance their mortgage to a lower rate to save some bucks.But like all forecasts, Grok did point out that “mortgage rate forecasts are inherently uncertain, and unexpected economic or geopolitical developments could alter outcomes.”If nothing else, it’s got that last part right! 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)

Homeowners who were locked into high interest rates have been eager for them to dip so they can refinance. Last week, many saw their chance and took it.Mortgage applications rose 2.7% for the week ending June 27, according to the Mortgage Bankers Association's Weekly Applications Survey, driven mostly by refinancing. Refinance applications were up 7% week-over-week and 40% from the same point last year. In contrast, purchase applications were essentially unchanged, moving up just 0.1% on a seasonally adjusted basis, though purchases were still up 16% from a year ago."Mortgage rates were lower across all loan types last week, with the 30-year fixed rate declining to its lowest level since April at 6.79 percent," said Joel Kan, MBA's vice president and deputy chief economist, in a statement. "This decline prompted an increase in refinance applications, driven by a 10 percent increase in conventional applications and a 22 percent increase in VA refinance applications."Kan added that homeowners with larger mortgages are often the most eager to refinance since they have the most to gain when interest rates drop."As borrowers with larger loans tend to be more sensitive to rate changes, the average loan size for a refinance application increased to $313,700 after averaging less than $300,000 for the past six weeks," he said.Refinance applications made up 40.1% of all applications, an increase from last week's 38.4%, underscoring the excitement many homeowners seemed to feel.Many homeowners who bought their homes when mortgage rates were 7% or higher have been looking to take advantage of cooling mortgage rates as an opportunity to refinance. Rates have mostly hovered between 6.8% and 7% in the first half of 2025, but some market watchers expect them to begin falling in the coming months, meaning that millions of homeowners could potentially look to refinance. Among purchase applications, conventional loans saw a slight uptick, making up 69.3% of applications compared to 68.5% the week before. FHA loans, which had seen a bump in interest last week, dropped to 18.2% of total applications. The percentage of VA and USDA loan applications remained mostly unchanged at 12% and 0.5%, respectively. FHA loans, which are popular with first-time buyers, are seeing increasing interest, with applications up 71.8% from a year ago, according to the MBA. Recently announced changes to the program could make the loans more appealing to would-be homebuyers, though it could also bring risks considering the recent rise in delinquency rates among borrowers in the program.Adjustable-rate mortgages made up 7.8% of all mortgages, up from the previous week's 6.9%. Interest rates for 5/1 ARMs averaged 5.99%, down from 6.16% the week before.Interest rates for other loans also dropped. The 30-year fixed-rate for jumbo loans stood at 6.79% while the rate for FHA-backed loans fell 6 basis points to 6.53%. The 15-year fixed-rate also fell slightly to 6.11%.