2.27.25 Generative AI; HomeLight's Nick Friedman on Originator Sentiment; New Home Sales Fall

Welcome to The Chrisman Commentary, your go-to daily mortgage news podcast, where industry insights meet expert analysis. Hosted by Robbie Chrisman, this podcast delivers the latest updates on mortgage rates, capital markets, and the forces shaping the housing finance landscape. Whether you're a seasoned professional or just looking to stay informed, you'll get clear, concise breakdowns of market trends and economic shifts that impact the mortgage world.

In today’s episode, we look at the best ways to implement generative AI. Plus, Robbie sits down with HomeLight's Nick Friedman to discuss a loan originator survey. And he closes by discussing why we are seeing lower new home sales despite demand.

Sagent powers banks and lenders to make loans and homeownership simpler and safer for millions of consumers. We bring the modern experience customers now expect from loan originations to loan servicing, where lifetime customer relationships are managed and grown. Sagent platforms let consumers manage their home-owning lives from anywhere while giving servicers lower costs, scale compliance, and higher servicing values through full market cycles.

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AI is definitely a discussion topic among lenders: what is it, will it help the borrower, will it help the lender… How would you like every hand motion you make monitored by your boss through AI? Well, welcome to the new world order. SIFMA has created this 10-step guide to help streamline “gen AI” implementation, without compromising safety or compliance. In other artificial intelligence news, thousands of artists are calling for an AI art auction to be cancelled, calling it “mass theft.” In a combination of technology and housing, we have “foldable and shippable” houses, Last fall, Boxabl co-founder Galiano Tiramani shared his frustration of regulations and code setbacks that kept its homes from reaching the masses. Kicking off 2025 at a different pace, this year has brought some good news to Boxabl as it have gained official approval of their flagship product, the Casita, under the residential building code in Nevada, where the company’s three factories operate. Hey, if the Agencies will lend on them, why not? (Today’s podcast can be found here after 6:45AM PT and this week’s is sponsored by Sagent. Sagent brings the modern experience customers now expect from loan originations to loan servicing, where lifetime customer relationships are managed and grown. Hear an interview with HomeLight’s Nick Friedman on findings from a survey of originators about borrower preferences and technology adoption.)

Employment

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“At SWBC Mortgage, we know that great people are the key to our success. That’s why we provide our Loan Officers with the tools, leadership, and strategies they need to thrive in today’s market. We continue to lead the way with a collaborative approach, strong marketing support, and programs like the SWBC Move Up Program™, which makes homeownership more affordable, especially in underrepresented communities. So far, we have provided over $1.4 million in grant funds to assist first-time homebuyers. Our supportive culture ensures you have the resources and strategies to help more buyers achieve their homeownership goals, whether you're navigating market shifts or celebrating wins. If you're looking for a mortgage company that values your growth, invests in your success, and empowers you with industry-leading strategies, SWBC Mortgage is the place for you. To learn more, reach out to Scott Brown, EVP of National Retail Sales.

“Who’s Really Profiting from Your Hard Work? Top loan officers are making the move to Canopy Mortgage because they’re tired of inflated corporate margins eating into their earnings. With 34% lower costs to fund a loan and a fully transparent P&L model, Canopy puts you in control of your income. Our proprietary LOS streamlines the loan process, giving you the speed and efficiency to close more deals, without layers of unnecessary management slowing you down. Are you ready to keep more of what you earn? Interested in a Tech Demo? Or an apples-to-apples comparison? Let's talk. Call 385-273-0404 or email us here for a confidential P&L review. Canopy Mortgage: Lower Rates. Better Tech. Real People.”

(As a reminder, anyone searching for employment can post their resume at no charge at www.lendernews.com, and potential employers can view all resumes for several months for only $75.)

Lender and broker products & services

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Have you ever wanted to be in the room where servicing innovation comes to life? It’s all happening at ICE Experience 2025. Servicers joining ICE’s mortgage technology experts at the Wynn Las Vegas from March 10-12 will get a front-row seat as they explore how ICE is making servicing simple. ICE Experience includes demos of ICE’s latest, cutting-edge innovations and a variety of sessions where you’ll learn how ICE is creating efficiencies to support HELOCs, loan boarding, customer retention, loss mitigation and more. Review the ICE Experience agenda and make sure to add sessions to your calendar so you don’t miss out on one of the biggest mortgage industry conferences of the year.

“loanDepot continues to strengthen its prominence in VA lending. Under the leadership of National Director of Military Growth and Strategy Bryan Bergjans and VP of National VA Lending David Smith, we have an ambitious plan to grow our VA lending platform. A key to our success is our ability to connect, at scale, with members of both the real estate and active duty/Veteran communities. One example: a monthly opportunity to educate National Guard members, on post, as they return from active duty to help them better understand the benefits of the VA home loan. Our VA Council, comprised of VA lending specialists, is always on tap to share their expertise with any member of our team serving a VA customer. And our expansive VA product portfolio (which includes VA renovation loans and programs with a 520 minimum FICO) makes it easy to serve virtually any Veteran need. If you’re looking to serve more Veterans, partnering with loanDepot can help you do it. Contact Bryan Bergjans to learn more.”

A seamless mortgage process shouldn’t start with a clunky payment request. Fee Chaser automates upfront fee collection and integrates with your Encompass workflow so borrowers pay instantly and your team stays focused on closing loans. Book a 10-minute demo with the team to take a closer look.

The mortgage industry is primed for innovation, driven by advanced yet practical solutions that adapt to lenders’ evolving needs in a shifting market. Xactus is leading this charge by redefining verifications with a truly innovative solution that is built upon valuable insights derived from verification data. It is called Intelligent Verification. Xactus360, the company’s Intelligent Verification Platform™ (IVP), replaces rigid, costly processes with flexible, automated solutions. Xactus360 integrates seamlessly with existing POS and LOS systems, delivering the data lenders need, when they need it. With Xactus360, lenders can easily transform their workflows, eliminating inefficiencies and reducing data waste. The result? Faster decisions, smoother processes, and a smarter, more agile approach to lending. To learn more, schedule time to meet with Xactus at ICE Experience 2025.or email sales@xactus.com.

“Struggling to find the most competitive pricing scenarios for your borrowers? Are inconsistent rule applications affecting your efficiency and profitability? Join our webinar on March 25 at 1 p.m. CT to learn how the Optimal Blue PPE can transform your lending process and rules management. Optimal Blue experts, Kimberly Melton and John Dumonsau, will demonstrate how to enhance operational efficiency and leverage automation to maximize your profitability. In this session, you’ll learn about Originator Assistant in the Optimal Blue PPE, which uses generative AI to identify alternate loan scenarios, offering more competitive pricing and options for borrowers, saving loan officers time and enhancing strategic discussions. We’ll also share more about Rules Optimizer, which simplifies rule management by allowing lenders to create and apply rules across multiple products and investors, reducing repetitive work. Don't miss this opportunity to optimize your advantage in 2025. Register now to secure your spot.”

MCT today announced the release of Atlas, an AI advisor and high-quality educational resource for MCT’s mortgage lender clients. With this launch, effective 2/10/25, MCT continues its tradition of innovation in secondary marketing technology, offering clients instant access to expert knowledge and paving the way for future AI-driven workflows that will save clients time and improve their financial performance. “We’re proud to be the first mortgage capital markets platform to put AI in the hands of every client,” said Phil Rasori, COO of MCT and architect of Atlas. “AI has the potential to improve performance and act as a force multiplier for capital markets professionals, but only if it is deployed responsibly and transparently with careful protections for client data ownership and privacy.” Learn more about the data security and privacy standards built into Atlas or watch MCT’s webinar, AI Blueprint for the Future of Mortgage Capital Markets Technology.

“Home Insurance for your California Clients: Meet Bamboo Insurance! At Bamboo, we know better than most that the California insurance market is putting unnecessary stress on you and your clients. With coverage options disappearing and loan delays piling up, it’s tough to get things done. But at Bamboo Insurance, we’ve got you covered. More than covered, actually. While many insurers are exiting the market, we’re still here, actively writing homeowners’ policies to help keep your deals on track. But we don't just stop at coverage. We’re dedicated to providing quick, reliable, and hassle-free solutions that protect your clients and let you focus on growing your business. With limited partnership opportunities available for brokers and lenders, don’t wait: reach out to Chris Irvine, VP of Bamboo Agency, today. Let’s work to get your clients insured so you can both stay assured in an uncertain market. NPN 18657046, CA Lic #0M31082.”

Capital flowing into residential lending

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Figure Technology Solutions (“Figure”), a technology platform powering an efficient, liquid, blockchain-based marketplace for financial products, and Sixth Street, a leading global investment firm, today announced the formation of a new joint venture vehicle in which Sixth Street’s Asset Based Finance platform has committed to invest $200M of equity. This commitment is unique in that it can be recycled and used for future Figure production driving additional liquidity for Figure private credit loans.

This is the latest development for Figure Connect, Figure’s transformative marketplace for private credit loans, making it easier for loan origination partners to scale their businesses. Figure Connect’s key advantages include attractive warehouse lines to manage cash flow, hedging to manage market risk, and modern infrastructure that automates loan sales and deliveries, all on a public, transparent blockchain. With Figure Connect, partners can also use the marketplace infrastructure for price discovery by putting out pools of loans for bidding.

A look at investor and agency news

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The news flow out of Washington DC, and around the nation, has been immense, and often does not impact underwriting guidelines directly. Here’s a smattering of what’s happening.

PHH Correspondent Lending posted information on FEMA’s update end date of California disaster declaration, DR-4856-CA.

AmeriHome issued a reminder to Sellers of important ROV disclosure and loan delivery requirements that may impact purchase eligibility. See AmeriHome Product Announcement 20250202-CL for details.

The Council of Large Public Housing Authorities’ (CLPHA) Executive Director Sunia Zaterman released the following statement regarding the latest threats to public housing authorities (PHAs) posed by cuts to HUD programs and staff and a potential government shutdown. “A government shutdown disrupts PHA operations and continuity of service to residents, voucher holders, private owners, investors, and partners. Appropriators have still not agreed to the total amount of the budget, which is the first step in the budget process. After that it takes weeks to finalize and pass full year appropriations bills. Securing HUD funding is critical in protecting PHAs, residents, and staff. Congress must pass a full year FY25 appropriations bill that provides adequate funding for HUD programs.” Learn more at clpha.org.

Consistent with President Trump’s January 20, 2025, Executive Order: Delivering Emergency Price Relief for American Families and Defeating the Cost-of-Living Crisis, which includes pursuing appropriate actions to lower the cost of housing and expand the housing supply, today the Federal Housing Administration (FHA) issued a temporary partial regulatory waiver and related Single Family Housing Policy Handbook 4000.1 (Handbook 4000.1) waiver to its minimum property standards (MPS) requirements. Without this partial waiver, the new MPS required elevation standard would have limited the land available for development and increased the cost of construction for FHA-insured single-family properties, thereby contributing to the insufficient supply of new construction housing and rising home prices.

Capital markets: is the U.S. economy slowing?

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Mortgage rates have dropped as of late, largely due to skepticism about potential tariffs and the ongoing federal cost-cutting, both of which have potential to slow the overall economy. The market yesterday benefited from some more buying in the afternoon after the U.S. Treasury sold $44 billion in 7-year notes, making for the third strong note auction in a row. There were some noteworthy developments in Washington, as the House passed a budget bill, President Trump ordered a review of U.S. copper imports, and Ukraine is expected to accept a rare earths deal with the U.S. to help facilitate the end of the war with Russia.

New home sales dropped 10.5 percent in January, extending the string of weak housing data to start the year. However, upward revisions to December’s figures helped soften the impact of the decline. Even so, January’s annualized sales pace of 657,000 units was still 1.1 percent lower than the same time last year, highlighting how elevated mortgage rates continue to dampen buyer demand. With inventory levels remaining high relative to sales, builders are likely to proceed cautiously in the months ahead, balancing economic uncertainty with shifting policies on trade, immigration, and broader market conditions.

Today’s economic calendar kicked off with a second look at Q4 GDP (+2.3 percent, as expected, but the price index was tad high at +2.4 percent), durable goods orders, and jobless claims (242k, much higher than expected). Later today brings January pending home sales, Kansas City Fed manufacturing for February, Freddie Mac’s Primary Mortgage Market Survey, and a laundry list of Fed speakers. We begin the day with Agency MBS prices are roughly unchanged from Wednesday evening, the 2-year yielding 4.08, and the 10-year yielding 4.28 after closing yesterday at 4.25 percent.

(Thank you to Euie H. for this one.)

Yesterday, I had a flat tire on the freeway coming home from shopping. So, I eased my car over to the shoulder of the road, carefully got out and reached in the side compartment I took out two cardboard men, unfolded them and stood them at the rear of my car facing on-coming traffic. They looked so life like you wouldn't believe it! They're dressed in open trench coats that exposed their nudity to the approaching drivers.

But to my surprise, cars started slowing down to look at my lifelike men. And, of course, traffic began backing up. Everybody beeped their horns and waved like crazy. It wasn't long before a state trooper pulled up behind me.

He got out of his car and walked towards me. I could tell he was not a happy camper!

“What's going on here?”

"My car has a flat tire," I said calmly.

“Well, what the heck are those obscene cardboard men doing here by the road?”

I couldn't believe that he didn't know. So I told him......

"Helloooooo, those are my emergency flashers!”

Visit www.robchrisman.com for more information on our industry partners, access archived commentaries, or to subscribe to the Daily Mortgage News and Commentary. If you’re interested, visit my periodic blog at the STRATMOR Group web site. This month’s piece is titled, “Natural Disasters and Economic Resilience.” The Commentary’s podcast is live and at any place you obtain your podcasts (like Apple or Spotify).

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(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes visit LenderNews. This newsletter is for sophisticated mortgage professionals only. There are no paid endorsements by me. For up-to-date mortgage news visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.robchrisman.com. Copyright 2025 Chrisman LLC. All rights reserved. Occasional paid job & product listings do appear. This report or any portion hereof may not be reprinted, sold, or redistributed without the written consent of Rob Chrisman. The views and opinions in this newsletter are mine alone unless otherwise specifically stated herein.)