6.4.25 Housing Inventory Metrics; Partners Credit's Tracey King on Credit Costs; Free Wells Fargo

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 go through some surprising housing inventory statistics. Plus, Robbie sits down with Partners Credit’s Tracey King for a chat about the evolving conversation around credit costs, what lenders should understand about FICO’s role, and how early credit data signals provide a valuable lens into future market activity. And we close with a look at the latest from President Trump's trade war.

Today’s episode is sponsored by CreditXpert—the credit optimization platform that helps today’s top mortgage originators and more than 60,000 mortgage professionals qualify more applicants, make more competitive offers, reduce LLPA premiums and close more loans. Download your free copy of the credit optimization playbook today at creditxpert.com/chrisman. 

Transcript

As the world is watching the chicks learn to fly on the eagle cam, in the human world there are more “For Sale” signs. You know that problem we’ve had with inventory for years? Although all real estate is local, perhaps the inventory issue is over: U.S. home sellers are sitting on nearly $700 billion worth of listings, an all-time high. In addition, the U.S. housing market has nearly 500,000 more sellers than buyers, the most on record. You can guess the impact on home prices if it plays out. Keeping on with stats, the NAR Chief Economist Lawrence Yun said existing home sales will increase by 6% in 2025 and by 11% in 2026 during the “Residential Economic Issues & Trends Forum” at the NAR 2025 REALTORS® Legislative Meetings. Yun forecasted that new-home sales will rise by 10% in 2025 and by 5% in 2026, the median home price will climb by 3% in 2025 and by 4% in 2026 and that mortgage rates will average 6.4% in the second half of 2025 and 6.1% in 2026. “The housing market remains very difficult at the moment… Part of the delay in recovery is because the Federal Reserve has changed its outlook and appears to be on pause for a longer period.” (Today’s podcast can be found here and this week’s is sponsored by CreditXpert, the credit optimization platform that helps today’s top mortgage originators and more than 60,000 mortgage professionals qualify more applicants, make more competitive offers, reduce LLPA premiums, and close more loans. Hear an interview with Partners Credit’s Tracey King on the evolving conversation around credit costs, what lenders should understand about FICO’s role, and how early credit data signals provide a valuable lens into future market activity.)

Employment: COO position

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 Executive Opportunity: Chief Operations Officer at HMA Mortgage! HMA Mortgage (HMA), a rapidly expanding independent lender, is seeking a visionary Chief Operations Officer (COO) to spearhead significant advancements in our operational efficiency and technological integration. This pivotal executive role demands a proven leader with 10+ years of comprehensive mortgage industry experience and a profound understanding of process optimization, automation implementation, and scalable growth strategies. The COO will be directly responsible for overseeing all facets of our operational functions, from loan processing and underwriting to servicing and post-closing activities. A key mandate for this role is to lead the strategic adoption of cutting-edge technology, including AI-driven solutions and advanced workflow automation, to dramatically enhance productivity, streamline workflows, and elevate the overall customer and employee experience.

Success in this role hinges on a strong track record in managing complex, high-volume operations, successfully implementing large-scale automation initiatives, and expertly navigating the continuously evolving mortgage regulatory and technological landscape. Exceptional communication, change management, and project leadership skills are essential for driving these transformative projects and ensuring seamless adoption across all teams. HMA Mortgage is a highly respected independent mortgage lender headquartered in Pennsylvania since 2005. Being referral-based and now licensed in 30 states across the country, HMA partners with reputable local and national lending institutions to offer clients the best services and most competitive rates available. If you are a highly results-oriented executive eager to shape the future of mortgage operations and contribute to a dynamic, growth-focused organization, we invite you to explore this opportunity by contacting Managing Partner, Tom Mills, at 443-309-9346.

Products, software, and services for lenders

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“What if your technology worked for you rather than the other way around? At Optimal Blue, we don’t just promise ROI. We power it. Real returns, instead of hyped-up claims. Powered by automation, accuracy, and insight. Ask Obi is your executive AI assistant, delivering fast, reliable answers to complex profitability questions using your own Optimal Blue data. No additional cost, just better decisions and insight. Originator Assistant, available in the enhanced Optimal Blue® PPE user interface, helps loan officers structure smarter deals by identifying alternate scenarios with more competitive pricing. It spots breakpoints, suggests strategic adjustments, and eliminates human bias, so you can focus on the borrower, not the math. Rules Optimizer lets you apply a single rule across multiple investor relationships, while enhanced Lock Extensions workflows help simplify configuration and reduce complexity. Explore the new innovations from Optimal Blue.”

In today’s market, efficiency is everything. Xactus helps lenders cut costs and simplify workflows through its Intelligent Verification platform, Xactus360. By eliminating unnecessary steps and data waste, Xactus360 delivers real-time, actionable insights, all tailored to fit seamlessly into your processes. Xactus isn’t just another vendor; it’s a true partner in performance, helping you accelerate decisions and get more from every loan file. Connect with the Xactus team at The Gathering, June 8–11 in Colorado Springs, to see how Intelligent Verification can work for you. Download the Intelligent Verification white paper or email sales@xactus.com to learn more.

A peregrine falcon in a hunting dive, called a stoop, can reach over 200 mph. That kind of speed isn’t about brute force. It’s about control, precision, and knowing exactly when to move. If you’re responsible for the borrower experience at your organization, take note: Tropos brings that same kind of velocity to mortgage lending. It’s fast to deploy, smart enough to adapt in real time, and gives borrowers a seamless experience from application to disclosures, without cutting you out of the loop. When speed meets strategy, everyone wins. Experience the speed of Tropos.

Happening today! Operations leaders! Looking to modernize your operations? Join Vesta and Truv on June 4 at 2pm EST to see how modern lenders are verifying income and employment. You’ll see how a powerful API integration delivers real-time income and employment data, reduces manual processes, and improves the borrower experience. With insights from Vesta’s Graham Young and Truv’s Richard Grieser, this session is a must for lenders looking to modernize operations. Register today to reserve your spot.

What Happens When Mortgage Ops Meet Genius Tech + Expertise? You get Indecomm’s Genius-enabled services: Genius tech that delivers, talent that gets it, and workflows that work. Our Genius-powered solutions combine SaaS, AI, automation, and proven mortgage process pros to help lenders scale smartly and keep costs in check, without reinventing the wheel. With GeniusWorks, go from underwriting to clear-to-close in one seamless flow, or tap us for fulfillment support, underwriting, quality control, or post-closing support via our Post-Close HUB. We don’t just bring the tools—we bring the talent to wield them. That means fewer errors, faster cycles, and scalable support that flexes with market demand. It’s modern mortgage execution. No bloated tech. No long ramp-up. Just real outcomes. That’s Genius@Work. Learn more at Indecomm.com.

Correspondent and broker product developments

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“APB Wholesale: Built for Brokers Who Want to Win. At APB Wholesale (the wholesale arm of the mortgage division of American Pride Bank) we don’t just partner with brokers. We go to battle with them. Our product lineup? Stacked. Think VOE-only, DSCR for first-time investors, conventional, and non-QM solutions that actually solve problems. Need pricing now? Our platform delivers instant scenario pricing. Need a decision fast? You’ll have it in 24 hours or less. Our team is all-in on high-touch service, zero drama, and maximum pull-through. We’re here to help you close more loans, faster. Become an approved broker today and visit apbwholesale.com.”

“Do you have Realtors that have listings with assumable low rate first mortgages? Symmetry can help fill the gap between an Assumable First and Sales Price! We need 10.01% down for a primary residence up to $500K loan amount and we can help make up the rest with our Interest Only* HELOC for qualified borrowers! Help unlock New Possibilities with Assumption Loans for your pre-approved database. Increase Buying Power with lower rate assumable first mortgage & our Interest Only* HELOC. Free up cash to improve property by using our HELOC to make up the difference. Provide strategic solutions to both your clients and realtor partners. We will treat 2nd as a purchase if submitted within 120 days from closing the 1st, and we can close fast once we have your full package with appraisal and assumption paperwork. Reach out for more details or questions. Have a great day! *Interest only payments during draw period (plus annual fee). Symmetry Lending.”

Thinking about the cost to produce a loan

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Whether it’s $12 or $13k per loan, do you really think that you’re going to markedly lower the cost to produce a loan this quarter? Or next quarter? As Mike Yu, Jeremy Potter, and Sasha Stair discussed Monday, the biggest piece of “cost” is compensation, so unless you’re going to offshore everything, or pay LOs 25 basis points, changes in efficiency, automation, and technology will only take you so far.

As Mike said, "You cannot add technology without subtracting something else and expect costs to change." Yes, there’s some room for cost improvement, and, as LOs know, also ... many costs are not within a lender’s control, similar to home “affordability” costs also include insurance, HOA fees, or property taxes.

If you cannot immediately lower costs, has your customer experience, given how complex a home loan is, improved when compared to other lenders? In a commodity business, the question must be, “Are lenders measuring the right things?” Operational costs and sales/marketing are the two levers lenders do control. Lowering a lender’s marginal cost is important… how is your accounting department measuring it?

Lenders are great at considering new processes, new meetings, and therefore costs, but what about eliminating tasks or eliminating steps, cutting touches per loan, removing meaningless meetings from calendars, and so on? If you are not projecting to subtract something along the way, how are you going to cut costs? How will you achieve additional profitability or sales opportunity?

Some lenders are turning to AI to do just that: cut marginal cost and increase productivity without adding more headcount. For example, Insellerate’s Aithena, for example, is helping lenders lower compliance costs, uncover missed opportunities, and boost LO productivity with real-time AI insights. CEO Josh Friend noted, “Lenders are great at considering new processes, new meetings, and therefore costs, but what about eliminating tasks or eliminating steps, cutting touches per loan, removing meaningless meetings from calendars, and so on? If you are not projecting to subtract something along the way, how are you going to cut costs? How will you achieve additional profitability or sales opportunity?”

Capital markets: tariff policy volatility is a problem

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Are you still running a complicated spreadsheet for your MBS pool bids? Join Agile on June 12th at 11AM PT for their latest webinar, Outsmart the Chaos: How Top Firms Are Fixing MBS Pooling. In this webinar, Agile’s Greg Vacura, Tawab Abawi, and Sam Farmer will walk through real-world scenarios, from managing dealer bids to simplifying swap allocations, and show how lenders can achieve operational efficiency through intelligent automation. Designed for mortgage capital markets professionals, this session will highlight the challenges lenders face today when managing MBS pool bidding. They will also demonstrate how a centralized, automated, and more intelligent solution can improve efficiency and execution. Register for the webinar or contact Agile to learn more.

Yesterday’s big news was that the Federal Reserve announced that Wells Fargo is no longer subject to the asset growth restriction from the Board’s 2018 enforcement action against the bank. Seven years. What might it mean? Wholesale and correspondent channels are a way to add assets quickly, and/or add servicing assets. Encouraging its branches to originate jumbo or portfolio products might be another. Stay tuned! Needless to say, the stock price is higher.

The next big news yesterday was President Trump doubling U.S. steel and aluminum tariffs to 50 percent from Europe, escalating trade tensions amid ongoing negotiations. Across the Pacific, rather than the Atlantic, tensions between the U.S. and China also ratcheted up again, largely over critical minerals. Xi and Trump are expected to continue talks later this week. While markets have grown accustomed to Trump’s pattern of aggressive moves followed by retreats, his unpredictable tactics are contributing to a broader global economic slowdown, data shows.

Obviously, the Federal Reserve remains vigilant about the potential inflationary effects of wage pressures as labor market conditions gradually loosen. Treasury Secretary Bessent has sought to reassure investors by stating that a government default is not on the table, though he offered no new guidance on the anticipated “x-date” for when federal funds could be depleted, keeping mid-September as the provisional estimate.

Ahead of Friday’s payrolls report, ADP employment for May (+37k, a fraction of what was expected) kicked off today’s economic calendar. We’ve also received mortgage applications from MBA, which decreased 3.9 percent from one week earlier and hit a five-week low. Later today brings final May global services PMI, the ISM equivalent, remarks from Atlanta Fed President Bostic and Governor Cook, and the Beige Book is set to be released this afternoon ahead of the June 18 FOMC decision. The Bank of Canada will also be out with its latest decision, with odds favoring no cut. We begin Wednesday with Agency MBS prices slightly better than Tuesday’s close, the 2-year yielding 3.94, and the 10-year yielding 4.43 after closing yesterday at 4.46 percent after the weak ADP data point.

A butcher cracked open his back door to get a little air. A dog ran in, grabbed a couple of beef tenderloins, and ran out.

It happened in the blink of an eye, but the owner was able to recognize that the dog belonged to a lawyer who practices nearby. He goes to his office, and says, “I was wondering if I could ask a hypothetical question. Let’s say a dog got inside my shop and stole a piece of meat. Would the dog owner be responsible for the damages, so to speak?”

“Of course,,” says the lawyer. “

Well, in that case you owe me 50 bucks because that’s exactly what your dog did earlier today.”

Without saying a word, the lawyer gets 50 dollars from his wallet and gives it to the butcher.

The very next day the butcher receives a $500 bill in the mail for the legal consultation.

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, “Compensation is Still Lender’s Largest Expense.” 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.ChrismanCommentary.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.)