10.22.26 Administration Tactics; Experian’s Ryan Rosales on Verification; Housing Market Pressures

Robbie ChrismanWelcome to the Chrisman Commentary, Daily Mortgage News Podcast. I'm your host, Robbie Chrisman. Topics on today's episode include news emanating from Washington, D.C., the competition between risk sentiment and geopolitical developments, and my interview with Experian's Ryan Rosales on expanding income and employment data coverage to improve verification speed and borrower experience, and what mortgage lenders need to do to assess the new data and prepare for future developments in digital verification. Here, take a listen to a little preview. What's been so exciting about these new integrations and just kind of the way that you see the product suite at Experian advancing and everything that it's starting, beginning to offer the mortgage industry or able to offer the mortgage industry? Ryan RosalesI think we're we're at a tipping point in the industry right now because a lot of the data source providers, they're seeing that they have a way to enable their data and these workflows and essentially help the employees that get paid through their platforms get to life events quicker, whether that's you know getting a mortgage, you know, getting a new job. And that in itself is a breakthrough for the industry because you know, traditionally you either go through one of a handful of vendors or you go manual. And then that interplay between limited choice has forced lenders to just pick a camp. And each camp has its ups and downs. And especially when we think about where mortgage lending is today, um, lenders need more flexibility. Consumers are more demanding. So, like, you know, more choice, different products, having the data flow throughout the ecosystem, it just helps out everyone. Robbie ChrismanThanks to today's podcast sponsor, Experian. Experian Verify's integration with Workday gives mortgage lenders broader access to reliable, up-to-date income and employment data, streamlining verification, enhancing efficiency, and delivering a smoother borrower experience from application to closing. To learn more, visit Experian.com slash business, slash products, slash Experian-Verify. In the book of 1984, George Orwell observed who controls the past controls the future. Who controls the present controls the past. There are plenty of current events impacting people's opinions in psychology, which in turn spill over into potential buyers, either sitting on the sidelines or buying a home. The Trump administration certainly has its proponents who often cite the reduction in illegal immigration and don't mind the price of fuel. But servicers took note that the administration plans to cut disaster aid in as few as six months and shift responsibility to states, FEMA's administrator said. Meanwhile, lenders just continue to try to help borrowers. And a quick clarification from yesterday's podcast MBA Home Base is not an LO membership to MBA per se, but is a member benefit for LOs at MBA member firms. That includes the option for LOs at non-MBA members to participate at a higher non-member rate. I'll give you one guess who got an email clarifying that. U.S. housing and mortgage markets are facing mounting pressure as 30-year mortgage rates remain elevated, pushing monthly payments higher, worsening affordability, and contributing to a seventh consecutive weekly decline in mortgage applications and a 41% year-over-year drop in total volume. Home builder confidence has fallen to its lowest level since June of 2012, as rising financing and construction costs, labor shortages, and elevated home prices weigh on demand and margins, prompting builders to cut prices, offer mortgage rate buy downs, and reduce home sizes. Limited housing supply, regulatory constraints, and homeowners' reluctance to sell or refinance are further suppressing market activity, while lower refinancing expectations have led Fannie Mae and the MBA to reduce their 2027 mortgage origination forecasts. The White House is reportedly preparing an executive order to improve housing affordability through measures such as simplifying mortgage insurance cancellation, expanding GSE title insurance pilot programs, reducing VA and USDA loan premiums, and lowering GSE refinance guarantee fees, likely ahead of the midterm elections. While proactive mortgage insurance cancellations could pressure insurers' earnings, the impact is expected to be manageable through potential share buybacks, while title insurers face limited exposure given the small contribution of refinancing to premiums. Moreover, the absence of proposed FHFA premium cuts should limit competitive pressure on private mortgage insurers. Overall, these initiatives are likely to have a modest impact on mortgage insurers, title insurers, and the broader mortgage market, with implementation challenges and persistently elevated interest rates limiting their near-term effectiveness. For today's interview, I wanted to welcome to the show Experian's Ryan Rosales to talk about expanding income and employment data coverage to improve verification speed and borrower experience, and what mortgage lenders need to do to assess the new data and prepare for future developments in digital verification. He's SVP and GM of Verification Solutions and head of EVH Mergers and Acquisitions and Business Ventures. Normally I'd read the rest of the bio, but that's a long enough title for a satisfactory introduction. So you are the SVP and general manager of verification solutions and head of the EVH Mergers and Acquisitions and Business Ventures. You sound like a very busy man. You explain your job in a little more detail for people. Ryan RosalesMy background and experience is I've helped launch some new verticals in our North America business, you know, starting with the mortgage one. And when we got into uh we want to enter the verification space, you know, we did that through acquiring data sets from employers, uh, namely the payroll stuff through HR compliance outsourcing. That's our employer service business. And my world is like strategy, MA, venture investments, and strategic partnerships to build those businesses. And, you know, there's an opportunity for me to take PL responsibility. One of the businesses I help build, that's verification solutions. So I've been here from the start, and you know, I have helped build the case internally, built our brand externally, and I'm excited to take us to this next phase. Robbie ChrismanOne exciting thing coming out of Experian is this Workday partnership. Experian now integrates with Workday to provide automated HR, payroll, tax compliance, and real-time income and employment verification solutions. Stepping back a little bit, what does the integration say about where income and employment verification is headed? And I mean, I feel uh selfish asking this, but but what should mortgage lenders expect from Experian going forward? Ryan RosalesWell, big picture. Experian is helping lead the market toward a broader, more open verification system built on multiple trusted data sources. And we expect the market to continue moving in this direction. And that gives lenders greater choice and how they access income and employment data. So that means greater coverage and choice that helps lenders better serve consumers across the credit spectrum. And then that creates a better borrowing experience, which is especially needed today. Robbie ChrismanYou talk about the significance for mortgage lenders of the Experian Verify integration with Workday. Big picture. Ryan RosalesThe integration adds Workday as a major new source of income and employment data within Experian Verify's growing instant verification network. And for mortgage lenders, that means greater access to the data that they need to verify borrowers instantly and move more applications forward efficiently. Robbie ChrismanThe integration with Workday, how does it expand the reach of Experian Verify? Because obviously coverage is critical when lenders are trying to verify a borrowers' income and employment. Ryan RosalesThe Workday integration adds access to millions of additional active employment records, and that significantly expands the reach of Experian Verify. And it supports Experian's path towards more than 80 million active records, and that represents more than half of U.S. payroll employees. It's a significant milestone for us because we've only been in this space for about five and a half years. And the takeaway is that greater coverage and increased competition give lenders more choice and flexibility to use the right verification solution at the right price. Robbie ChrismanBeyond expanded coverage, what can access to Workday data mean for the mortgage origination process and ultimately the borrower experience? Ryan RosalesGreater instant verification coverage, it reduces the need to request pay stubs and other documentation directly from borrowers. And that helps eliminate manual work and accelerates the lending process. So for consumers, that means less friction and a simpler, more seamless mortgage experience. And for lenders, greater verification choice also provides more flexibility to manage costs throughout the entire origination process. Robbie ChrismanLet's go through some of the nuts and bolts here a little bit. I want to know how Experian Verify accesses employment and income information through Workday because lenders care about the freshness and reliability of the information that they receive. Ryan RosalesThe way that it works broadly and simply is Experian Verify uses a transactional, it's called a GoFetch model to retrieve income and employment info through the Workday API at the time that the verification is requested. And this provides lenders with the current information directly from the source while keeping the process secure. And to be clear, the data is not stored at rest by Experian Verify, and it's only accessed only with the consumer's permission. Robbie ChrismanFor mortgage lenders already using Experian Verify, what do they need to do to take advantage of the additional Workday sourced records? Ryan RosalesThis is the beautiful part. Nothing. Nothing changes in the lender's existing Experian Verify workflow. The Workday source records are seamlessly incorporated into the same instant verification experience they use today. So the integration is live today, and lenders can already benefit from the expanded coverage. Robbie ChrismanThat sounds pretty sweet. I like doing nothing. Yeah. Ryan, I really appreciate the time today, man. Ton of exciting stuff coming out of Experian. I wish you the best of luck. Ryan RosalesThanks, Robbie. Same to you. Robbie ChrismanCompeting risk sentiment and geopolitical developments continued to drive cross-asset volatility. U.S. treasuries ended lower yesterday after another largely range-bound session turned to late selling. A weak $13 billion 20-year bond auction added pressure, and reports of U.S. diplomatic personnel departures from the Persian Gulf countries raised concerns about potential escalation with Iran. Safe haven demand has been offsetting concerns over geopolitical tensions, global fiscal pressures, equity volatility, and Fed policy. A flight to safety appears to be the best bet for getting mortgage rates to go down. Today's economic calendar is already underway with weekly initial claims in at 194,000 near the recent average, and continuing claims in at 1.728 million. Later today brings the September leading index and the Kansas City Fed Manufacturing Index for October. With stocks falling dramatically, we begin the day with agency MBS prices, better by an eighth to a quarter, the two-year yielding 4.73, and the 10-year yielding 5.04 after closing yesterday at 5.15%. Let's wrap up with a joke and some housekeeping. Leading up to a local election, two opposing candidates for county office happened to be sitting next to each other in the local diner. One turned to the other and said, You know why I'm gonna win this election? Because of my personal touch. For example, I always tip waitresses really well and then ask them to vote for me. Oh really? replied the other. I always tip a nickel and ask them to vote for you. Thanks again to Experian for sponsoring this week's podcasts. Experian verifies integration with Workday, gives mortgage lenders broader access to reliable, up-to-date income and employment data, streamlining verification, enhancing efficiency, and delivering a smoother borrower experience from application to closing.