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A new class action lawsuit accuses Zillow of a massive kickback scheme in steering thousands of borrowers to its allegedly more expensive in-house financing business. Araba Armstrong, an Alaska homebuyer who used Zillow's services, is accusing the real estate giant of violating the Real Estate Settlement Procedures Act. Her complaint filed in a Washington federal court last week seeks to cover all Zillow Home Loans borrowers who were referred by a Zillow participating agent. The complaint suggests Zillow's Premier Agent and Flex programs incentivize real estate agents to steer consumers to Zillow Home Loans to obtain, and retain, higher quality leads. The company's origination arm has grown in recent years and reached $1.28 billion, nearly all purchase volume, in the third quarter."Zillow's system harms consumers, who are robbed of the disinterested advice of their fiduciary real estate agent, and instead are unknowingly steered towards ZHL's limited and often uncompetitive mortgage products," the lawsuit read. The lawsuit doesn't specify the amount of damages sought and suggests a class size of at least thousands of customers. Neither attorneys nor a spokesperson for Zillow returned requests for comment Tuesday. It follows other major litigation targeting Zillow, including a class action suit accusing the company of misleading buyers into contacting Zillow buyer agents rather than a property's seller agents. The Federal Trade Commission also sued Zillow in September over a rental advertising deal with Redfin, and Compass filed an antitrust lawsuit against its rival this summer over exclusive property listings.How Zillow is accused of steering borrowersThe kickback accusations focus on Zillow's programs, specifically Zillow Flex, in which participating agents must meet ZHL pre-approval quotas to maintain access to the high quality leads. Agents who don't achieve stronger ZHL metrics face reduced volume or removal from the program, according to the lawsuit. Flex agents must handle their leads in Zillow's proprietary app, and the firm records data it uses to rank real estate teams on leaderboards for metrics including ZHL approval rate. In addition to greater ZHL volume, the parent company receives "success fees" in which Flex agents share up to 40% of their commission with Zillow for successful transactions. The plaintiff, who purchased a home through Zillow last year, claims she believed she was obligated to use Zillow Home Loans for her mortgage. Armstrong argues the lender only offers a narrow range of conventional and Federal Housing Administration-backed loans, and she was steered away from programs which offer closing cost assistance. The lawsuit also accuses Zillow of violating a Washington consumer protection law, in concealing the steering incentives within its agent programs. A summons for the company was also filed last week. More borrowers are accusing lenders of violating RESPAThe Zillow complaint follows class action litigation against two other major competitors for their alleged kickback schemes during the market's recent heyday. Multiple borrowers sued Loandepot this summer for violating the Truth in Lending Act, in both depriving certain customers of lower rates and loan officers of their owed compensation. The megalender is accused of offering customers inflated rates, and greatly reducing compensation for LOs who had to lower those rates to close their loans. CrossCountry Mortgage is also facing six RESPA class action complaints in North Carolina for a purported kickback scheme in concert with a Raleigh-based brokerage via a comarketing agreement. Both of those lenders have denied wrongdoing, and the cases remain pending in federal courts.

Key insight: Bessent says Trump policies boost Treasury market, lower borrowing costsSupporting data: Treasury returns are up 6% this yearForward look: Treasury to keep auctions steady, avoid market shocksTreasury Secretary Scott Bessent Wednesday said the administration's economic policies were addressing affordability for Americans.Speaking Wednesday at the New York Fed's Treasury Market Conference months after Trump's "liberation day" trade policies sparked instability in the Treasury market, Bessent said the U.S. had the "best-performing developed bond market this year," and situating the department's work within President Trump's push to "Make America Affordable Again.""Lower Treasury borrowing costs mean lower corporate borrowing costs, lower mortgage rates, and lower car payments," he said. "The Treasury market's total returns year to date are 6 percent—its best year since 2020…that all translates to greater affordability for all Americans."Bessent outlined a host of technical and regulatory changes with the goal of improving market liquidity, including with a revamped Treasury buyback program, in which the department buys back older debt to support liquidity and reduce swings in the market. After market turmoil following the April 2 rollout of President Donald Trump's sweeping tariff program triggered a selloff, the market experienced the sharpest yield spike since 2001, agency officials have said they would evaluate "potential enhancements" in order to "better achieve its liquidity support and cash management goals."Bessent also touted pending reforms to the enhanced supplementary leverage ratio, or eSLR, which he argued has "become a consistently binding constraint rather than a backstop." In June, bank regulators submitted a draft rule to the Office of Information and Regulatory Affairs — a branch of the Office of Management and Budget that now reviews regulations — that would modify rules for banks' supplementary leverage capital requirement.The proposal would replace the current flat 2% enhanced supplementary leverage ratio applied to the largest banks with a variable buffer equal to half of each bank's Method 1 global systemically important bank surcharge, ultimately reducing banks' required Tier 1 capital and leverage-based total loss-absorbing capacity and long-term debt requirements.Leverage ratios are designed to apply uniformly to all a firm's assets, regardless of each asset's perceived risk, which is why they are often smaller than risk-based capital standards and harder to manipulate, acting as a secondary safety net. During the COVID-19 pandemic the regulators briefly allowed banks to exclude Treasuries and allowed large banks to appear better capitalized than they would otherwise if their Treasury bond debt was factored in.Trump appointees like Bessent have supported the move, but the idea has received mixed reviews from some observers in the past. Former Republican FDIC Chair Sheila Bair said in a 2020 op-ed that loosening the SLR would amount to backsliding on Dodd-Frank reforms that protected the market from moral hazard, encouraging banks to buy government debt and increasing systemic risks.The current 2% rule discourages banks from engaging in "low-risk activities, such as Treasury intermediation," according to Bessent. The Secretary said these measures respond to systemic shifts in demand for government debt, particularly short-term bills from money market funds, which grew by over a trillion dollars this year, reaching $7.5 trillion, and from the stablecoin sector. The latter is estimated at $300 billion,  but Bessent says it could grow tenfold by 2030."The stablecoin market could grow tenfold by the end of the decade thanks to the innovation made possible by the GENIUS Act," Bessent said, referring to recent legislation enabling digital dollar instruments to back stablecoins with Treasury bills. Banks, too, are increasing their holdings according to the official, "as they shake off the excessive oversight that held them back."Bessent framed these developments as part of Treasury's "regular and predictable" issuance philosophy of issuing all Treasury securities on a stable, predetermined schedule. This approach, he said "promotes transparency and investor confidence" and ensures gradual, data-based adjustments to the quantity and maturities of bonds offered. "We will remain analytical in our decision-making, adjusting issuance gradually to avoid market disruptions," Bessent said. "We will provide public forward guidance to the extent practicable. And we will regularly canvass the market for feedback on how our issuance decisions are being received."Looking ahead, Bessent said Treasury does not expect to alter the amount of debt  for sale at its regular auctions "for at least the next several quarters," citing "existing financing capacity from current auction sizes and robust demand in the bill market." 

David Paul Morris/Bloomberg Key Insight: Federal Reserve Bank of Atlanta President Raphael Bostic, the first black and openly gay head of the regional bank, will end his term in early 2026. Until a successor is appointed, Cheryl Venable, vice president of the Atlanta Fed, will step in to fill the role. Expert Quote: "I'm proud of what we accomplished during my tenure to turn the lofty goal of an economy that works for everyone into more of a reality." — Federal Reserve Bank of Atlanta President Raphael BosticWhat's at stake: Bostic's retirement plans will have an impact on the composition of the Fed's rate-setting committee. Though the Atlanta Fed's president will not vote on the committee until 2027, a reshuffle may change the balance of what part of the dual-mandate the central bank focuses on.Federal Reserve Bank of Atlanta President Raphael Bostic announced Wednesday that he plans to retire after more than eight years in the role.Bostic's term — along with all regional Fed bank presidents — ends on Feb. 28, 2026, and Bostic said he will not seek reappointment, according to an announcement from the Atlanta Fed. Until a successor is named, Cheryl Venable, first vice president and chief operating officer of the Atlanta Fed, will serve as interim president.Bostic, who took office June 5, 2017, is the 15th president of the Atlanta Fed. He was the first Black and openly gay president of a regional Federal Reserve bank and has often emphasized issues of equity and inclusion in the economy."I'm proud of what we accomplished during my tenure to turn the lofty goal of an economy that works for everyone into more of a reality, and I look forward to discovering new ways to advance that bold vision in my next chapter," he said in a Wednesday press release. Bostic, a rotating voting member on the Fed's rate-setting committee, departs as divisions among policymakers are becoming more visible, underscoring uncertainty about the central bank's next moves. The Federal Open Market Committee has 12 voting members, including five regional bank presidents who rotate annually. Bostic would have been a voting member again in 2027.In recent speeches, Bostic has expressed caution about cutting interest rates, citing persistent inflation and uncertainty surrounding President Trump's tariff policies."Today, things are very much in flux, there's a lot of uncertainty," Bostic said in a speech from early July. "And what it means for me is, before I want our policy to move in any dramatic direction, we've got to let things sort out."Fed Chair Jerome Powell, commenting on Bostic's retirement, said the Atlanta Fed president provided a perspective that "enriched the Federal Open Market Committee's understanding of our dynamic economy.""His steady voice has exemplified the best of public service — grounded in analysis, informed by experience, and guided by purpose," Powell said in a statement Wednesday. "His leadership has strengthened our institution and advanced the Federal Reserve's mission."Bostic's tenure was not without controversy. In 2022, he faced scrutiny over potential trading violations, which he said were made by a third-party manager without his knowledge or involvement.He has claimed he was not aware of the specific trades or timing of the transactions, which were made by a third-party manager in accounts where he did not have ability to direct trades.Prior to his role at the Atlanta Fed, Bostic chaired the Department of Governance, Management and the Policy Process at the University of Southern California's school of public policy. He also served as assistant secretary for policy development and research at the U.S. Department of Housing and Urban Development from 2009 through 2012 and was an economist at the Federal Reserve Board from 1995 through 2001.

The Senate-approved budget extender has several provisions around the Veterans Affairs partial claims program to help distressed borrowers.In particular, one section of the bill is called in part Improvements to Partial Claim Program. A change extends the period for a second partial claim filing following a natural disaster to 180 days from 120 days.A Realtor.com study of National Association of Realtors data (the two organizations, other than a licensing agreement, are not connected) found 74% of first-time VA program users put 0% down; buyers using a conventional mortgage put a median 12% down.For some, rather than having to save for a down payment, they are able to buy a home 4.4 years sooner than a conventional borrower.But the Realtor.com/NAR press release notes VA program use is low in some areas, particularly high-priced cities like Los Angeles, San Francisco, San Jose, and New York, where co-op restrictions, and limited awareness also play a role.Only about one-third of Veterans and active-duty service members know ­about the no money down benefit, a 2025 survey from Veterans United Home Loans cited in the press release said.The provisions included in the extender could modestly improve utilization, said Hannah Jones, Realtor.com senior economic research analyst in an emailed comment."Allowing VA borrowers to directly pay buyer-agent commissions makes these buyers more competitive in today's tight housing markets, removing a long-standing structural disadvantage," said Jones. "By aligning the program more closely with conventional financing norms, this change may attract more eligible veterans and active-duty buyers who previously felt at a disadvantage."Payment of commissions became an issue following several class action settlements involving NAR and/or real estate brokerages, including Nosalek. A temporary policy had been in place which permitted such payments.The partial claims provisions could increase the appeal for lenders to market these loans, Jones added. "With an added safety net for distressed loans, lenders may be more willing to promote or underwrite VA-guaranteed mortgages, potentially leading to incremental growth in loan volume."But at the end of the day, these changes are not likely to drive a dramatic increase in VA usage.The underlying issues for homebuyers regarding affordability pressures, limited inventory, credit and income constraints, plus competition in high-cost markets, remain largely unchanged."In short, the new provisions may smooth the path for more borrowers and lenders, but a surge in adoption is unlikely to happen overnight," Jones said.The partial claim program was created in response to the expiration of the Department of Veterans Affairs' Servicing Purchase Program; it was signed into law in July.Unlike the Federal Housing Administration's partial claim program, the VA version is a "one and done," explained Christian Hancock, a partner at Bradley.  The exception is the allowance for a second claim following a natural disaster declaration. This bill adds 60 days to the time allowed for making that subsequent claim.It is helpful for servicers, albeit not earth-shattering, Hancock said.This is also not likely to be a needle-mover for consumers, few if any, worry about how a potential default is handled, she added."Anything that helps a consumer that's struggling is a really good thing," Hancock said. From the servicer's perspective, "they like to have as many tools as they possibly can to help people, and this extends one of those tools, so it's positive in that sense."Hancock added the tools to help in these areas are not as robust as those for conforming or the FHA program.The bill still needs to be approved by the House of Representatives, with a vote expected on Wednesday. Unlike the Senate, a simple majority will move the bill to Pres. Trump for his expected signature.

The Federal Home Loan Bank System has an economic benefit at least nearly twice the size of a Congressional Budget Office estimate of its implied-guarantee cost, new research shows.The system has at least a $13.2 billion benefit annually, 1.9 times what the CBO has estimated is its main $6.9 billion government subsidy, according to a new Urban Institute research project. CBO estimated the full cost at $7.3 billion last year.The assessment of the system that provides member banks with a source of financing based on mortgages and other eligible collateral arrives amid broader federal spending reviews that could have a bearing on its future."In this time where the government is looking at really driving efficiencies and cutting costs, the study confirms that the Federal Home Loan Bank System is fulfilling its mission," said Ryan Donovan, president of the council. The council commissioned the ongoing study.More about the current and future number around benefitsThe estimate for the FHLBanks' benefit starts at $13.2 billion but could be as high as $21.4 billion, according to the report, which analyzes benefits the system provides in three categories across a range of different possible scenarios.The scenarios are based on a variety of possible incidence and prevention rates for major and minor crises, and the total also factors in Federal Deposit Insurance Corp. savings.The $13.2 billion estimate, for example, breaks down $10.53 billion in benefits related to mitigation of systemic concerns, nearly $1.76 billion stemming from a reduction in financial distress from more minor crises and $950 million in FDIC savings.To reach their conclusions, authors Jung Hyun Choi, Laurie Goodman and Jun Zhu analyzed information from multiple sources, including quarterly bank call reports and numbers related to the funding advances the FHLBanks make to members. Advances spiked around the time of the 2008 housing crash, 2020 pandemic and the 2023 banking crisis, an examination of total outstanding commercial and savings bank activity between fourth-quarter 2002 and 2023 in the report shows.Other findings and future research plansOn top of the economic benefit, the study finds the liquidity provided through the government-sponsored enterprise system's advances based on the implied guarantee saves homeowners $3.8 billion through lower-cost mortgages.The next stage of the research will be to examine whether membership and advances affect lending activity followed by an examination of benefits to affordable housing programs and community related activities.

A change in mindset, away from the transactional and more towards creating relationships has led to higher customer satisfaction scores, improved trust and increased levels of brand loyalty, the latest J.D. Power survey found.But in what can be termed as a surprise in the results, Citi had the highest score in the 2025 U.S. Mortgage Origination Satisfaction Study, but perennial leader Rocket was just above the industry average in its results.It is a case where the companies ahead of Rocket actually had larger increases in their scores, noted Bruce Gehrke, senior director of wealth and lending intelligence at J.D. Power.Rocket was the No. 1 lender in the American Customer Satisfaction Index survey released in October. Rocket was also on the top of the J.D. Power servicer satisfaction survey released in July. Unlike the Power results, the ASCI study found customer satisfaction scores for the industry was 1% lower than the prior year.How did mortgage lenders do on this year's surveyThe industry average score this year was 760, an unheard of increase of 33 points, Gehrke pointed out. But it was not totally surprising. During each quarterly wave of data that J.D. Power collected starting with the 2024 survey, the scores have improved.It is also significantly different from the servicer survey results. This year's industry average of 596 was a decline of 10 points versus the 2024 servicer study.Meanwhile the difference between banks and independent mortgage banks average scores in the origination survey narrowed to 12 points from 18 points one year ago after widening from 1 point in the 2023 survey.Besides Citi, the next three on the list, Bank of America, Citizens and Huntington are depositories. Slots five through eight were non-bank lenders Movement, Guild, Prosperity and Fairway.What the leaders in the origination survey have in commonAll eight have something in common. The top companies on the list, both bank and non-bank, "are bringing to the process less friction; smoother, faster transactions; and then that engagement difference, being more advisory in the process earlier, it is magnifying that effect," Gehrke said.Furthermore, all eight of these lenders are focused on the distributed retail lending model."They have local loan officers in the community working in conjunction with realtors, real estate agents, etc.," he added. "They're out there with very personal interaction and relationships with borrowers, and so those top eight firms all are driving a little bit of that more advisory interaction."What factor helps customer satisfactionThe earlier the initial contact, the better. Overall satisfaction is 32 points higher when lenders connect with customers at the beginning of their home-buying journey, before they start actively shopping, the survey found. But this drops by 64 points when lenders first engage the borrower at the mortgage application stage.With Rocket, the Redfin buy puts them in the heart of the purchase market at the start of the borrower's journey, but to what extent this will help this part of the business, time will tell. The Mr. Cooper transaction had not closed during the data collection period, but the transaction had little effect on either company's score.Even though Mr. Cooper was at the bottom of the list at a 697 score, it was a vast improvement from 2024, when it scored 659.In fact, all but two of the scored companies showed year-over-year improvement, Gehrke said.What role does home equity lending playAmong the industry trends that Power is watching which impacts both origination and servicing is the growth of home equity lending. Rocket is now the largest close-end second lender in the U.S., and adding the Mr. Cooper portfolio should contribute to future growth, he said. Other firms which are likely to benefit from this trend are Freedom and Pennymac.The growth of home equity/second lien lending is an opportunity for servicers to play in the customer advisory arena, Gehrke said."I think it makes it challenging for independent mortgage bankers who don't have a lot of servicing to fall back on when it comes if we see some significant drops in interest rates, which, of course, is an open question," Gehrke said. "Originating refinances outside of those big servicers, I think it's going to get more and more challenging."How artificial intelligence use effects satisfactionThis year's survey asked customers about the impact of artificial intelligence and the expectations around it for the first time.Slightly more than half (54%) of customers claimed they were "completely comfortable" with their lenders using AI in the mortgage origination process, while another 31% say they are "partially comfortable." Customers also want to know how the technology is being used, Gehrke said.But a growing use of AI is to make marketing calls; while the survey didn't mention any specific instances, United Wholesale Mortgage in its third quarter results promoted the success it had with Mia.It is possible that such calls could be seen as just another version of the hated robocall.

Woodward Capital Management and AG Mortgage Investment Trust is sponsoring a $524.1 million residential mortgage-backed securities (RMBS) deal, selling notes through the RCKT Mortgage Trust 2025-CES11.Rocket Mortgage originated the asset pool of 5,669 second lien loans, which have an average balance of $92,455, analysts at Fitch Ratings.The latest RCKT Mortgage Trust series will issue the RMBS through eight classes of exchangeable notes. The deal is expected to close on November 20, with a final maturity date of November 2055, said Kroll Bond Rating Agency, which also assessed the deal.Citigroup Global Markets, Wells Fargo and Bank of America are initial note purchasers, according to KBRA. Among the deal's potential credit risks are the second-lien mortgages themselves, which normally have a high expected loss severity, KBRA said. Also, potential future home prices declines are another potential credit risk to the notes, KBRA said. But those seem to be significantly mitigated by several other factors.For one, the borrowers appear to be of prime credit quality, with a weighted average (WA) model FICO score of 742. Leverage is also modest, with an original debt-to-income ratio of 39.6%, and a WA securitization loan-to-value ratio of 73.7%, Fitch said.Both tranches of A1 notes will repay investors on a pro-rata basis, while the A2 through B3 tranches repay sequentially, KBRA said. Fitch analysts said the senior classes incorporates a 1.00% step-up coupon after the 48th payment date.California accounts for the largest percentage of borrowers, with 14,3% of the pool balance, according to Fitch.Fitch assigns ratings of AAA to the A1 notes; AA to the A2 notes; A to the A3 notes; BBB to the M1 notes; BB to the B1 notes; and B to the B2 notes.KBRA assigns AAA to the A1 notes; AA+ to the A2 notes; A+ to the A3 notes; BBB+ to the M1 notes; BB+ to the B1 notes; and B+ to the B2 notes.

A 50-year mortgage on a median-priced US home could reduce borrower's monthly repayment, but also double the amount of interest the owner pays over the life of the loan, according to UBS Group AG analysts.The longer mortgage could lower the monthly payment by about $119, or increase an average consumer's purchasing power by almost $23,000, analysts John Lovallo, Spencer Kaufman and Matthew Johnson wrote in a note on Nov. 10. "However, extending a mortgage from 30 years to 50 years could double the dollar amount of interest paid by the homebuyer on a median priced home over the life of the loan," they added.READ MORE: Trump, Pulte float 50-year mortgage use in U.S.The calculations are based on assumption that a borrower makes a 12% down payment on a median-priced home of about $420,000. Extending the length of a mortgage would also mean buyers build equity much more slowly over the loan tenor, they said. Talk of a 50-year mortgage bubbled up over the weekend after a social media post by President Donald Trump showing a picture of former President Franklin Delano Roosevelt under the words "30-year mortgage," next to a photo of Trump with the caption "50-year mortgage." Federal Housing Finance Agency chief Bill Pulte on Saturday posted that "thanks to President Trump, we are indeed working on The 50 year Mortgage — a complete game changer."Critics of the plan, including Georgia Republican Representative Marjorie Taylor Greene, have assailed the idea as being a giveaway to banks and mortgage lenders. Trump later downplayed criticism, saying it would help more Americans afford monthly payments on homes.While it's unclear exactly how the US government could compel banks to offer longer-term home loans, UBS estimates that government-sponsored enterprises such as Fannie Mae and Freddie Mac could be used to purchase those mortgages from lenders and package them into securities to sell to investors similar to current mortgage-backed debt products. UBS analysts said they also expect more premium on the borrowing rate of the 50-year debt as it wouldn't be easily classified as qualifying loans under the Dodd-Frank Act."Other potential complicating factors include the fact that the average first-time buyer is 40 years old and therefore could be deceased before a 50-year mortgage matures," the analysts said.

As the government shutdown comes to an end, two congressmen introduced legislation to retroactively restore the National Flood Insurance Program.Reps. Troy Carter, D-La., and Mike Ezell, R-Miss., introduced the Retroactive Renewal and Reauthorization Act to the House Monday, with hopes to backdate the reauthorization of the insurance program to Sept. 30, the day before the shutdown, and extend it until Dec. 31, 2026. "The lapse of the National Flood Insurance Program isn't a partisan problem — it's a people problem. Families shouldn't lose their coverage or face higher premiums because of political gridlock," Carter said in a press release.The program, which counts more than 4.7 million policies providing more than $1.3 trillion in coverage, was shut down along with the government, so no new flood insurance policies could be issued or renewed. With the 30-day grace period to renew over from some, policyholders could face higher rates unless Congress passes a retroactive extension.Under the Federal Emergency Management Agency's Risk Rating 2.0, existing policyholders transition gradually to full-risk rates, but lapsed policies must pay those rates immediately upon reauthorization, the release said."This lapse now threatens the premium increase glidepath guaranteed to legacy NFIP policyholders who have played by the rules," said Michael Hecht in the release on behalf of the Coalition for Sustainable Flood Insurance. "Our analysis of FEMA data shows that NFIP premiums under Risk Rating 2.0 are rising by over 100% on average and by at least 50% in 41 states. Reauthorizing NFIP retroactively ensures that these glidepaths are retained, thus encouraging cost-burdened Americans to maintain coverage and mitigate our nation's risk," he added.The lapse has delayed home closings and left homeowners uninsured in the back half of hurricane season. In the second week of the shutdown, the National Association of Realtors estimated that as many as 1,400 sales per day could stall or fall through without flood insurance.If Congress does not pass the bill or one similar, any new or renewed policies will only take effect on or after the date the program is reinstated. This would leave policyholders vulnerable to flood losses during that uninsured period, the release said."The [NFIP] is a critical lifeline for American households to avoid economic ruin from flooding disasters," said Amy Bach, executive director of United Policyholders. "The private flood insurance industry may hold promise, but it is nowhere near ready to come close to providing the level of security the NFIP provides," she added. "It is imperative that the program be re-authorized and retroactively available to those whose policies lapsed during the shutdown so they don't end up re-rated and priced out of this important protection."

Refinancing slowed down in October after consecutive months of dramatic spikes, pushing down rate-lock activity.Rate locks fell 4.2% to 122 from September to October, but were still up 18% on a year-over-year basis, according to Optimal Blue's latest Market Advantage mortgage data report.Purchase locks decreased 1.5% last month, following seasonal trends, while rate-and-term refinances dropped 14% month over month, but were still up 143% from the same time last year. Cash-out refinances saw monthly and yearly increases of 6% and 29%, respectively."October's data speaks to the market's resilience," said Mike Vough, head of corporate strategy at Optimal Blue, in a press release Tuesday. "Purchase activity held steady and refinance demand — particularly cash-outs — remained strong. Even after September's record pace, October delivered another standout month for originations."Mortgage rates hit 6.17%, its lowest level in more than a year, at the end of last month, according to Freddie Mac, boosting the significant year-over-year increases in refinance activity. But after 69.8% and 153.7% increases in the prior two months, a month-over-month drop off was not surprising.The Optimal Blue Mortgage Market Indices 30-year conforming fixed rate fell 16 basis points to a similar 6.16%, its lowest mark since late 2023. Rates for government-backed mortgages decreased as well, with Federal Housing Administration loans down four basis to 6.04% and Department of Veteran Affairs loans down 15 basis points to 5.67% month over month.The easing rates grew the number of highly qualified refinance candidates, homeowners with at least a 720 credit score, 20% equity and potential savings of at least 75 basis points, to 1.7 million, the most since early 2022, according to ICE Mortgage Technology. Secondary markets see more activityLarger-lender securitization growth continued last month with increased activity in the secondary market. Sales to agency mortgage-backed securities climbed 400 basis points to 46%. As a result, sales to the agency cash window fell 200 basis points to 30%, while aggregator bulk and best-efforts channels each dipped 100 basis points.The share of loans sold at the highest price tier rose to 81%, up 300 basis points."October's secondary market data reflected clear strength in execution," said Vough. "Lenders leaned further into MBS sales and maintained access to top-tier pricing, signaling disciplined hedging and growing investor confidence. With securitization share and pricing quality both on the rise, large lenders appear well positioned to sustain profitability as production remains steady."