Apr. 28: Pres. of Production, LO jobs; non-QM, reverse, productivity, AVM, AI tools; investor & lender results: it's still tough out there

“Rob, the local chapter of my state’s mortgage organization is having an axe throwing night. Can you put it in your Commentary in upcoming events?” Uh, no. There’s plenty of other things going on, true or rumored, to put in this Commentary. “Rob, are you hearing companies are continuing to cut back personnel and expenses even more?” Yes, absolutely. Arguably there are still too many lenders and not enough loans. “Rob, have you heard that Fannie had another batch of layoffs Friday?” It is rumored that the environmental, social, and governance (ESG) team at Fannie was dismissed. (That should surprise no one, given the priorities of the current Administration.) “Rob, have you heard that DOGE has instituted caps on USDA loan amounts?” I haven’t seen anything in writing, but DOGE cuts in recent months have hit the USDA hard, very hard, so it wouldn’t surprise me. “Rob, have you heard that scammers put fake lenders and vendors are on the internet?” Kind of… I know that Google is suing alleged scammers of over 10,000 fake Maps listings. My bet is that there are some mortgage-related falsifications there. (Today’s podcast can be found here and this week 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 Mark Cunningham on the state of tech evolution in the industry, how to win business, and where automation will actually translate to cost savings.)

Employment & new moves

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Innovation at LeaderOne Financial isn’t just about technology. It’s about empowering people to deliver lasting value. Recently, Wyatt Hansen, VP of IT Services, was spotlighted in Fintech Magazine for his role in streamlining lending operations and maximizing returns without overspending on tech. “We don’t focus on technology to replace our team, but to complement them,” says Michael Brady, CTO. “This provides more time for the care of the customer and our team who are creating lasting relationships. That, in turn, strengthens our capital and control pillars to remain strong and growing.” Newly appointed President Randell Gillespie adds, “While others fear ‘McMortgage’ companies, we are focused on something more important: our clients and the LeaderOne pros helping them”. If you want to join a company where creativity and care drive success, connect with Staci Ann Thompson to learn more about opportunities at LeaderOne. Discover how you can help shape the future of mortgage lending.

“President of Production: National Mortgage Lender! Join a thriving, privately held mortgage banking firm with a national presence and a strong foundation in operational excellence. Founded in 2005, we are an approved Fannie Mae, Freddie Mac and Ginnie Mae seller/servicer, direct lenders for FHA, VA, and USDA, and offer a full range of portfolio and jumbo products, including a dedicated Reverse division. With licenses across all 50 states and a growing team of 250+ loan officers, we’re experiencing sustained year-over-year growth driven by innovation, integrity, and a passion for homeownership. As an ESOP company, we’re proud to invest in our people while delivering exceptional customer experiences. We’re seeking a visionary leader to oversee national production and continue expanding our market footprint. If interested, please send your resume to Chrisman LLC’s Anjelica Nixt and specify this opportunity; held in strict confidence.”

Recently Prudent AI announced the promotion of Paul Gigliotti to Chief Growth Officer (CGO), reinforcing its commitment to accelerating AI adoption across the mortgage industry. With over two decades of experience spanning Mortgage Lending, Fintech, operations, and strategic growth, Gigliotti has built a reputation for driving transformation through technology. His success in building strategic partnerships, optimizing operations, and leading go-to-marketing strategies positions him to accelerate Prudent AI’s market expansion. Paul brings a wealth of expertise to his expanded role at Prudent AI. His previous success in building strategic partnerships, driving operational efficiencies, and scaling organizations positions him to successfully accelerate Prudent AI's market expansion. A belated congratulations!

(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.)

Software, products, and services for lenders & brokers

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The emergence of voice AI will be transformative in lending. As lenders look to deploy this technology, which brings human-like AI sales assistants into the customer journey, it raises new compliance concerns that must be considered at an enterprise level. On May 6 join Total Expert Founder & CEO Joe Welu as he sits down with the Weiner Brodsky Kider PC Managing Director Mitch Kider as they explore the super power AI offers while discussing the compliance and regulatory considerations. They’ll introduce a purpose-built consent management and AI engagement framework designed specifically for highly regulated lending workflows. From re-engaging preapprovals to surfacing refinance opportunities and educating borrowers about rate changes, they’ll show you how to prioritize transparency, trust, and compliance at every step. Register now!

In a world where borrowers expect everything on demand, why are pre-approvals stuck in the slow lane? QuickQual gives borrowers and agents the freedom to generate pre-approval and pre-qual letters instantly, always within lender-set limits. Faster deals. Fewer headaches. Happier borrowers. Modernize your pre-approval process.

HouseCanary delivers the real estate industry’s most accurate automated valuation model and property analytics platform, now available to mortgage specialists nationwide. With a dataset covering 136 million properties across 14,000 ZIP codes, HouseCanary empowers lenders and loan officers with instant insights for underwriting, pre-qualification, and client engagement. Featuring the first AI assistant in real estate, HouseCanary combines transparent pricing with enterprise-grade data and forecasting tools, previously reserved only for major lenders, to help you accelerate decisions, mitigate risk, and build stronger client relationships. Trusted by top financial institutions, HouseCanary is redefining how mortgage professionals access, analyze, and act on property data, making every step from lead to close smarter and more efficient.

FREE EBOOK: Helping Borrowers Navigate Loan Products & Pricing: A Loan Officer’s Guide to Winning Trust and Closing More Loans. Today’s borrowers are overwhelmed with fluctuating rates, rising home prices, and a maze of loan options. A loan officer’s ability to simplify the process and offer clear, fast solutions is the ultimate advantage. In Maxwell’s eBook, LOs will learn how to quickly deliver personalized, easy-to-understand loan comparisons that build borrower confidence and set you apart from the competition. Discover time-saving strategies, tech tips, and proven methods to create a seamless borrower experience—and close more deals. Click here to download “Helping Borrowers Navigate Loan Products & Pricing: A Loan Officer’s Guide to Winning Trust and Closing More Loans.”

Correspondent & wholesale product news

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The fastest-growing segments of the mortgage market aren’t fitting into the traditional box, and that’s exactly where non-QM thrives. On Thursday, May 1 at 2 PM ET / 11 AM PT, NMP’s Non-QM Masterclass Series continues with Part Two: Who Does Non-QM Serve Best? Paul Jones, SVP of non-QM Business Development at Logan Finance, will break down the borrower profiles driving today’s non-QM demand, including self-employed borrowers, gig workers, 1099 earners, investors, and foreign nationals. You’ll learn how to identify these clients early, understand their unique financial profiles, and align them with smart, flexible solutions that traditional lending can’t touch. Reserve your spot here.

“Despite the current turbulence in the overall mortgage landscape, Citi Correspondent Lending remains committed to responsible growth based on a consistent client-centric approach that offers opportunities for lenders to optimize loan delivery. A prominent element of this is our Mandatory Desk, which features bid tape AOT and two-way pair off options, solutions that can help sellers realize higher returns and mitigate risk. Whether a current or prospective client, reach out to the Account Executive supporting your location to learn more, or schedule time to meet with us at the upcoming Secondary and Capital Markets conference. Prospective clients can also complete and return our Prospective Client Questionnaire. We welcome the opportunity to share details regarding opportunities Citi offers now and what’s on the horizon.”

Last week, PHH Mortgage launched a proprietary reverse mortgage product known as EquityIQ®. The product is available through the Company’s wholesale network and marketed under PHH’s reverse mortgage product brand, Liberty Reverse Mortgage. “Our release of the EquityIQ product is the latest example of how PHH continues to provide new opportunities for its partners to grow their businesses,” said Rich Bradfield, Executive Vice President and Chief Growth Officer. “We believe EquityIQ can be a valuable option for our wholesale partners and their clients, and we look forward to continuing to expand our product options to meet our customers’ needs.” To learn more about EquityIQ, go here.

Lender & investor earnings tell a tale: it’s a tough business

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Mr. Cooper Group reported first-quarter 2025 results that reflect a mixed environment for mortgage production and servicing, as the company emphasized operational stability and strategic expansion despite a slowdown in origination volume. Overall origination slowed while Mr. Cooper’s purchase loan mix increased significantly: Purchase transactions accounted for 72 percent of funded volume in Q1, up from 65 percent in Q4, demonstrating a shift toward purchase-centric business even amid broader market weakness. Mr. Cooper’s refinance recapture rate jumped to 51 percent in Q1 from 35 percent in the prior quarter.

Meanwhile, Newrez’s owner Rithm Capital’s mortgage and servicing income dropped 54 percent on a quarterly basis to $146.7 million in the first quarter of 2025. Much of the swing was tied to a decline in the value of mortgage servicing rights. (MSR valuation is directly impacted by mortgage rate movement.) Rithm owns over $500 billion in servicing and took a $180 million MSR mark-to-market loss, including related hedge impact, in the first quarter.

Correspondent investor Newrez originated almost $12 billion of mortgages in the first quarter, down 32 percent versus Q4 of 2024 compared with the previous quarter. But its gain-on-sale margin increased slightly to 1.37% in the first quarter. However, pre-tax income from originations declined from $96 million in the fourth quarter to $65 million.

PennyMac Mortgage Investment Trust didn’t fare much better in the first quarter of 2025, marked by lower-than-expected loan production and profitability challenges, even as management remains optimistic about long-term returns through securitization strategies and credit-focused investments.

Although it beat expectations for the holding company, PrimeLending, the mortgage unit of PlainsCapital Bank, lost $8.3 million (before taxes) in the first quarter of 2025, but the loss was less than the company lost in Q4 of 2024. (For all of 2024, PrimeLending had a $33.7 million pre-tax loss.) “Prime” originated $1.74 billion of mortgages in the first quarter of 2025, down 26 percent from the fourth quarter.

Capital markets: the Fed is still independent in its thinking

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Last week’s news cycle (read: President Trump’s whims) leaned more conciliatory, especially toward both Fed Chair Powell and China. While it’s tempting to think this more measured approach will continue, the recent rebound in equities and stability in the bond market could just as easily encourage Trump to revert to more aggressive trade war rhetoric. His broader effort to redefine the U.S. role on the global stage is still in its infancy, and expecting a return to traditional market dynamics would be premature. For now, investors are left piecing together policy direction from tweets and off-the-cuff comments rather than reliable economic signals.

Federal Reserve officials are also signaling caution, with Cleveland Fed President Hammack suggesting a possible move by June if economic trends become clearer, and Governor Waller indicating support for rate cuts if Trump's tariffs start causing job losses. For now, the Fed plans to keep rates steady as it assesses the impact of Trump’s aggressive policies on trade, immigration, and deregulation. However, uncertainty continues to dominate, and a pressured rate cut might backfire. If the Fed’s independence is questioned, it could spark bond market turmoil, pushing up 10-year Treasury yields and, ironically, driving mortgage rates even higher.

We learned last week that durable goods orders in March rose 9.2 percent as non-defense aircraft orders surged. Additionally motor vehicle orders were up 2.3 percent, building on February’s strong gain. Shipments of core capital goods rose 0.3 percent. Housing continues to struggle as existing home sales fell 5.9 percent and were 23 percent below their pre-pandemic pace in March 2019. However new home sales rose 7.4 percent to a 724k unit pace although the majority of the activity is concentrated in the South. New home sales in the Northeast, Midwest, and West have slowed over the last twelve months. Elevated mortgage rates and a general uncertainty around future economic prospects are sidelining borrowers. Given the resilient economic data as well as potential inflation risks due to tariffs, no change to monetary policy is expected at the upcoming FOMC meeting in May.

Although there isn’t much today, this week’s calendar includes some key data, which culminates with the April payrolls report on Friday, with the first look at Q1 GDP and PCE before. Other reports of interest include updates on house prices, consumer confidence, the labor market, PMIs and construction spending. The Fed is in blackout ahead of the May 6/7 FOMC meeting and Treasury supply consists of just T-bills, though the details of the quarterly refunding will be released on Wednesday morning. Regarding MBS, attention will start to turn to dollar rolls, with April Agency prepayments released next Tuesday. The week gets off to a quiet start with today’s only data point being Dallas Fed manufacturing for April. We begin the week with Agency MBS prices roughly unchanged from Friday, the 2-year yielding 3.77, and the 10-year yielding 4.28 after closing last week at 4.27 percent.

This weekend I finally took the batteries out of the carbon monoxide detector because the constant beeping was giving me a headache and making me feel sick and dizzy.

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, “Love Them or Leave Them? The Ongoing Saga of Fannie and Freddie.” 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.)