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Mortgage Today (AM) - 11/05/26

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November 5, 2026

**WTMS Blog Today = What's up in Mortgage Today (AM) - 11/05/2026** UMBS are taking a breather after last week’s rally, with 30-year UMBS 6.0 down 7 ticks to 100.14 as the open skews risk-off ahead of Friday’s jobs report. Ginnie 6.0s are off a smaller 3 ticks at 100.18, and production coupons are mixed into the first hour. The 10-year hovers near 4.90 percent, still roughly 40–50 bps below early-October peaks. Yesterday’s post-election bid faded as corporate supply and stronger labor prints nudged yields higher. Rate sheets should reflect mild morning weakness, with lender dispersion driven by coupon mix and convexity. Several cross-currents explain the pause: initial claims fell to 189k (below all estimates), unit labor costs cooled with Q3 productivity up 3.6 percent, oil bounced after a two-day skid, and mega-cap corporate issuance added duration to dealer balance sheets. Even so, Wednesday’s bull-flattening on a Democratic sweep left term yields near eight-week lows as markets priced less fiscal impulse and lower oil risk. Net: the path of least resistance is choppy range-trading into Friday’s NFP. GNMA performance is modestly firmer versus conventionals this morning, with Ginnie 6.0s down less than UMBS on the day. Mortgage supply remains light, and the recent rally tightened primary/secondary spreads only modestly as lenders held back pass-through. Watch for coupon leadership: 6.0s and 6.5s still carry the liquidity baton, while deeper-discount shelves remain more volatile on intraday reprices. Servicers should continue monitoring VA and FHA prepay cohorts with cash-flow sensitivity as rate volatility stays elevated. Treasuries sit in a holding pattern: the 10-year trades around 4.90–4.93 percent, the curve a touch flatter after yesterday’s rally, and the Street digesting a steady quarterly refunding path. With midterms clearing a headline overhang and crude easing from last week’s highs, term premiums compressed but remain jumpy into payrolls. Expect near-term direction to hinge on Friday’s jobs data, oil headlines tied to Iran de-escalation prospects, and any renewed strain in AI/data-center funding. On the origination desk, borrowers remain highly rate-sensitive: purchase apps fell 2 percent week-over-week and sit 19 percent below last year, while refi volume is essentially flat. ARM usage climbed to 11.3 percent, the highest in over a year, as buyers trade term for payment relief. Equity remains the bright spot—HELOC/second-lien execution is competitive and fast—while Zillow’s 3.5 percent FHA down-payment assistance (via a forgivable second) in many states raises the bar on first-time-buyer competitiveness. Tactical takeaway: lenders should expect two-sided risk into NFP with spreads sticky and production coupons prone to intraday swings. Borrowers focused on payment can benefit from ARM ladders, buydowns, and targeted equity solutions. Sales teams should prep for quick turnarounds and reprices today and keep borrowers informed that tomorrow’s labor print could reset the tone for next week’s rate sheets. **Locking vs Floating** The late-October bond rally has stalled at a logical resistance area, leaving two-way risk elevated and favoring discipline over complacency. With headline sensitivity (oil/AI credit) high and major data (PCE/GDP now past, NFP due Friday) steering the tape, floating only makes sense with time and price cushion. Near-term bias leans defensive: lock gains on loans inside 15–20 days, especially in production coupons, and reserve floats for files with longer buffers and clear rate-improvement triggers. Be nimble around tomorrow’s jobs report, and respect intraday reprice risk if supply or headlines hit. **Today's Events** October Challenger job cuts (5:30 AM ET) and Initial/Continuing Jobless Claims (8:30 AM ET) set the tone ahead of Friday’s payrolls, with Fed speakers later in the day keeping headline risk alive. **Bond Pricing** **UMBS 30 yr** | Coupon | Price | Intra-Day Change | **GNMA 30 yr** | Coupon | Price | Intra-Day Change | **Treasuries** | Term | Yield | Price | Intra-Day Yield Change |

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Mortgage Today (PM) - 11/04/26

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November 4, 2026

**WTMS Blog Today = What's up in Mortgage Today (PM) - 11/04/2026** UMBS ripped higher into the close, with 30-year 6.0s up 50 ticks to 100.24 as the 10-year Treasury yield fell about 8 bps to 4.89%. The bid was driven less by the midterm headlines and more by another sharp selloff in large “neocloud/AI” names and a ~$20 slide in oil since Friday. That combo rekindled a safety bid across the curve and pushed rate sheets better in the afternoon. For originators, it’s the cleanest improvement in several weeks, but it still looks tactically fragile. Ginnie Mae performance joined the rally, with 30-year GNMA 6.0s up 0.38 to 100.24. FHA/VA locks benefited as spreads held in and volatility cooled, helping buydown math pencil a bit better. Pipeline takeaway: today favored rate-term scenarios and clean FHA/VA files, while cash-out remains price‑sensitive. The 10-year’s break back into the high‑4.8s is welcome, but context matters. Recent rallies have depended on tech jitters and oil softness more than a broad, durable “lower inflation” narrative. Without confirmation from next week’s data, a quick retest of 4.95–5.00% is still in play. Treat this as an opportunistic dip, not a new trend—yet. Earnings underline the operating reality. UWM swung to a $213M profit primarily on smaller servicing/hedging hits and expense cuts, even as volume slipped and gain-on-sale narrowed. Pennymac posted $29M overall, but production turned negative while servicing carried the quarter and MSR sales were teed up to trim debt. Translation for sellers: margins remain thin, execution discipline and coupon selection matter, and MSR is the ballast. Demand remains tentative despite modest rate relief. MBA-reported purchase apps fell again and are roughly 19% below last year, while refi remains pinned by the massive low‑coupon cohort. ARM share continues to creep up as payment‑hungry buyers hunt for incremental savings and sellers increasingly negotiate concessions over price cuts. Credit policy continues to evolve beneath the surface. Several lenders report early borrower savings from broader use of alternative scores in agency funnels, but investors will want more performance data before repricing credit risk en masse. Expect uneven adoption across channels, and price each loan to the best final takeout, not just the first DU/LPA pass. **Locking vs Floating** The rally looks more “tech jitters + oil drop” than a confirmed macro turn; it’s a tactical gift, not a green light. For near‑term closings, locking into the improved 10‑year range with triggers near 4.95%/5.00% makes sense, as a quick reversal is possible without supportive data. More risk‑tolerant pipelines can float selectively, but only with firm stop‑loss rules and attention to coupon liquidity. In short: lock the wins you need, float the basis you can defend, and keep buydowns hedged. **Today's Events** ADP jobs (Oct): 86K vs 69K forecast, 90K prior Trade Gap (Sep): -$105.0B vs -$108B forecast, -$105.6B prior S&P Global Composite PMI (Oct): 55.9 vs 57.6 forecast, 58.4 prior S&P Global Services PMI (Oct): 56.1 vs 57.9 forecast, 58.8 prior ISM Services Business Activity (Oct): 53.8 vs 56.5 prior ISM Non‑Manufacturing PMI (Oct): 54.5 vs 54.8 forecast, 54.9 prior ISM Services Employment (Oct): 51.4 vs 50.1 prior ISM Services Prices (Oct): 73.0 vs 74.0 prior **Bond Pricing** **UMBS 30 yr** | Coupon | Price | Intra-Day Change | **GNMA 30 yr** | Coupon | Price | Intra-Day Change | **Treasuries** | Term | Yield | Price | Intra-Day Yield Change |

Market Data

Mortgage Today (AM) - 11/04/26

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November 4, 2026

**WTMS Blog Today = What's up in Mortgage Today (AM) - 11/04/2026** Democrats swept the midterm elections, and mortgage markets responded decisively as Treasury yields plummeted and MBS prices rallied sharply lower. The 10-year Treasury yield fell 51 basis points to 4.91 percent, driven by expectations that Democratic control of Congress will limit additional fiscal stimulus and reduce deficit-financed spending concerns. UMBS 6.0 and other agency mortgage-backed securities recovered ground as investors fled equity risk and sought safety in fixed income. This marked a significant reversal from pre-election uncertainty, with oil prices also declining nearly 3 percent on reduced geopolitical tensions. Bond markets are now pricing in diminished likelihood of expansionary policies that would otherwise push Treasury yields higher. For mortgage lenders and originators, lower rates create an opportunity to re-engage borrowers on purchase activity and refinance conversations that have stalled since rates climbed above 7 percent. The election outcome effectively ended months of political uncertainty that had kept markets in defensive postures. Bill Pulte's absence from the MBA National conference last week signaled mounting friction between the FHFA and industry leaders, yet the Democratic sweep may reshape housing finance priorities away from executive directives toward legislative negotiation. Meanwhile, the industry is accelerating product mix shifts: ARM usage hit 14 percent of lock volume in September, non-QM climbed to 12 percent of production, and home equity products gained traction as cash-out refinancing remains viable despite higher rates. Fannie Mae reported third-quarter net income of $4.2 billion, up 17 percent year-over-year, while both GSEs continue trimming staff amid transformation efforts. These dynamics underscore how lenders are adapting their playbooks across conforming, non-Agency, and home equity channels to capture opportunities in a structurally changed market. October softness in purchase applications down 19 percent year-over-year reflects persistent affordability headwinds that a 60-basis-point rally in Treasuries alone cannot solve. Property taxes, insurance premiums, and utility costs now drive housing expense as much as interest rates, yet remain underweighted in loan qualification models. With 65.6 percent of outstanding mortgages carrying rates below 5 percent, homeowners anchored to their current loans are becoming landlords instead of moving up or relocating. Lenders who focus on borrower education around total cost of ownership, not just rate comparisons, are positioning themselves to win volume when rate expectations stabilize. The MBA's "Affordability in Action" roadmap and comparable industry initiatives are beginning to address closing cost reduction through appraisal waivers, title insurance pilots, and loan-level price adjustment reforms. Tech-enabled automation and AI-assisted underwriting continue reshaping mortgage operations as volumes persist below historical averages. Dark Matter's acquisition of House Numbers' agentic AI platform, Optimal Blue's Usherpa integration, and widespread UAD 3.6 appraisal format adoption are examples of how lenders are modernizing fulfillment to compete on speed and customer experience rather than rate alone. Fannie Mae's new AI governance requirements and Freddie Mac's mortgage compliance dataset initiative are establishing guardrails for responsible AI deployment across the industry. Lenders who invest now in auditable, explainable AI systems will gain operational advantage and regulatory confidence heading into 2027. The shift toward AI-assisted decisioning is compressing cycle times and reducing manual exceptions handling, a material efficiency gain for lenders managing leaner staffs. Warehouse lending platforms remain critical infrastructure, with lenders like Wintrust emphasizing stability and customized capital strategies during market volatility. Independent mortgage banks have struggled with loan officer retention as production tightens, with the gap between top performers and the bottom 80 percent widening measurably. MBA Homebase, a new initiative providing loan officer education and professional development regardless of company affiliation, signals the industry's commitment to workforce strengthening even as hiring demand has softened. STRATMOR data shows the mortgage M&A market is heating up, with roughly double the number of sellers and four times the number of qualified buyers signaling consolidation momentum heading into 2027. For loan officers and lender leadership, this environment rewards disciplined cost management, product diversification, and borrower-centric value creation over volume chasing. Credit scoring competition is accelerating as UWM and other major lenders adopt VantageScore 4.0 across production channels, challenging traditional FICO-only models and creating new opportunities for borrowers previously excluded by conventional thresholds. eLEND's new 500 credit score floor on FHA cash-out loans and expanding non-Agency programs demonstrate how competitive pressure is broadening credit access. Zillow's new down payment assistance for FHA borrowers, offering up to 3.5 percent DPA through a five-year forgivable second mortgage, signals retail lenders are aggressive on market share. CrossCountry Mortgage's cease-and-desist letters to former loan officers over customer refinances underscore the sharper enforcement of non-compete and non-solicitation agreements in a tightening labor market. For originators, understanding which credit scoring model your investor network prefers, and when alternative credit options genuinely expand origination capacity, is foundational to pricing competitiveness and profitability. **Locking vs Floating** Mortgage originators face two-sided hedge risk as duration extension concerns compete with convexity dynamics. If rates continue rising, mortgage spreads may widen and offer better execution opportunities; if Treasuries rally further, MBS duration shortens and forces costly hedge rebalancing. Borrowers should lock now if they plan to close within 30 days, as the election-driven rally may prove temporary absent sustained disinflation signals. Pipeline hedgers should monitor whether the Fed's December rate hike probability continues moderating and whether inflation data confirms momentum is breaking. Overall, this remains a fluid environment requiring disciplined hedging discipline and real-time market adaptation. **Today's Events** 10-year Treasury yield at 4.91 percent, down 51 basis points overnight following Democratic sweep of midterm elections. 30-year UMBS 6.0 trading around 99.90, better than Friday close by approximately 125 basis points. Core CPI reading of 0.335 percent versus 0.2 percent forecast triggered initial market sell-off before reversal. Agency MBS prices improving as flight-to-quality demand offsets earlier inflation concerns. **Bond Pricing** **UMBS 30 yr** | Coupon | Price | Intra-Day Change | **GNMA 30 yr** | Coupon | Price | Intra-Day Change | **Treasuries** | Term | Yield | Price | Intra-Day Yield Change |

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