Editor’s Note: The Mortgage Mix is RISMedia’s weekly highlight reel of need-to-know mortgage-industry happenings. Watch for it each Friday afternoon.
- A “tale of two economies” is exactly how Freddie Mac’s chief economist Sam Khater underscored this week’s mortgage rate surge after Freddie Mac’s Primary Mortgage Market Survey® (PMMS®) saw 30-year fixed rates rise more than 25 basis points to its highest level in 20 years.
- Inflation watch! The latest CPI reports show core inflation climbed to 6.6% in September, marking the biggest increase in 40 years. This reading came shortly after the Fed raised interest rates another 75 basis points, leaving onlookers to speculate that mortgage rates will be “fighting to hold at a 7% average rate” in the upcoming weeks.
- Foreclosure activity may have inched up in the third quarter, but it hasn’t translated to banks taking homes back, according to recent reports from ATTOM Data Solutions. Between July and September, foreclosure filings were reported for one in every 1,517 homes in the U.S., but experts say “very few” properties entering foreclosure have gone back to lenders at the end of the process.
- Fannie Mae forecasters have reduced their origination expectations, signaling that annual price growth could turn negative in Q2 2023 as rising mortgage rates strain the market. Fannie Mae Chief Economist Doug Duncan indicated that markets have increasingly and reluctantly “reflected the resolve of the Fed to lower inflation.”
- Despite rates passing 6%, the Mortgage Bankers Association (MBA) reported that mortgage applications increased 3.8% from the previous week. MBA’s Associate Vice President of Economic and Industry Forecasting Joel Kan indicated that the weekly gain “underscores the overall volatility” in the mortgage rate environment.
- Speaking of the MBA, the organization recently sent a letter to HUD Secretary Marcia Fudge requesting reductions of the annual Mortgage Insurance Premium (MIP). In connection with Black Homeownership Collaborative, this move would help reduce the cost of buying a home with an FHA mortgage and lower a significant barrier to entry for the Black community, according to the letter.
