“I once stayed up all night trying figure out where the sun went. Then it dawned on me.” Tomorrow is not only Father’s Day but it is the Summer Solstice, with the longest amount of daylight in the Northern Hemisphere (it’s not quite correct to state it’s the “longest day”), and the summer travel season is in full swing despite fuel costs. If you’ve ever wondered how airlines pick boarding groups, follow the money: they do it based on profits. “Following the money” is a common saying which often makes sense. Ralo (not the rapper) raised $2.9M in seed funding to scale its AI-native mortgage brokerage platform that “automates loan processing and reduces costs for homebuyers.” LOs know that households are always concerned about their money: Results from the 2025 Survey of Household Economics and Decisionmaking (SHED) continued to show stability in financial well-being at a level slightly below that seen just before the pandemic. Labor market indicators in the survey also remained solid, despite some softening. Additionally, the share of adults who said that price increases were a major concern declined.
Saturday Spotlight: Finance of America
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The next $14.66 trillion housing market isn’t emerging. It’s already here
Let’s talk about the elephant in the room, or rather, the massive pile of home equity sitting in living rooms across the country. Connecting clients to that cash through reverse mortgages is a lucrative opportunity for brokers today.
If you’re a growth-focused mortgage professional operating primarily in the forward lending space, you might not view reverse mortgages as a core part of your strategy. After all, the mortgage industry has historically been built around one specific moment: the home’s purchase.
But rate cycles change timing, while demographics change the market. By continuing to focus exclusively on traditional forward mortgages, you could be missing out on a parallel market that offers brokers reliable pipeline volume right now.
Finance of America is a forward-thinking leader in home equity and reverse lending. As your partner, Finance of America’s goal is to empower you with the tools to capture the full homeowner lifecycle, not just the beginning of it. That’s why Finance of America partnered to release a new white paper: The Profit Mindset Shift Hiding in Plain Sight.
This brief takes a hard look at the structural change currently driving housing finance. The traditional entry point into the market is getting tighter. Yet, there is a parallel market of comparable size hiding right in plain sight. Consider this: While total U.S. mortgage balances sit around $13.17 trillion, homeowners age 62 and older currently hold roughly $14.66 trillion in housing wealth. The new report is a practical guide designed to help you tap into that demographic goldmine to potentially win more business.
Here is a glimpse of what you’ll uncover: The full lifecycle approach: Forward lending builds home equity; reverse lending puts it to work. Learn how adapting your strategy to include reverse mortgages changes your relationship with borrowers from single-transactional to an ongoing, lifelong financial partnership. Overcoming outdated misconceptions: Reverse mortgages are no longer just a last-resort option. They have evolved into strategic financial planning tools for equity-rich but liquidity-constrained clients who want to comfortably age in place.*
Innovation in action: Discover how modern, flexible products, like HomeSafe Second, make it practical to expand into home equity solutions. Homeowners could now convert their home equity into usable capital without having to refinance out of a historically low-rate first mortgage and without adding a new monthly mortgage payment.**
Lenders who expand beyond traditional forward mortgages and embrace these home equity solutions could be better positioned for long-term growth and consistent volume over the next decade. The capital is already there. Discover how a quick mindset shift could transform your pipeline. Get the white paper.
*The right to remain in the home is contingent on paying property taxes and homeowner’s insurance, maintaining the home, and complying with the loan terms
**The borrower must meet all loan obligations, including meeting all loan obligations under the first lien mortgage, living in the property as the principal residence and paying property charges, including property taxes, fees, hazard insurance. The borrower must maintain the home. If the homeowner does not meet these loan obligations, then the loan will need to be repaid.
(For more information on having your firm’s extracurricular activities, employee growth, and your charitable side featured, contact Chrisman LLC’s Anjelica Nixt.)
Basel III: Will Basel IV be next?
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Let’s hope not. The final version of the Mortgage Bankers Association Basel III comment letter was submitted this week. Some key recommendations are briefly summarized below, and more details can be found in the Advocacy Update, which is linked here.
MBA’s recommended changes included a variety of topics to protect members and keep funds flowing in the capital markets. Mortgage servicing assets (MSAs): MBA recommends reducing the proposed 250 percent risk weight to no more than 100 percent, citing MSAs’ strong historical performance and lower realized losses. Warehouse lending: MBA urges regulators to modify provisions that would increase capital requirements on unused portions of warehouse facilities and reduce the capital requirements on the drawn portion to match the risk weighting of the underlying collateral.
Residential mortgages and private mortgage insurance (PMI): MBA supports the proposed loan-to-value (LTV)-based framework but calls for greater recognition of the risk-reducing benefits of PMI when determining capital requirements. Commercial real estate (CRE): MBA recommends broader adoption of a more granular, risk-sensitive CRE framework and lowering the maximum risk weight for high-LTV CRE loans so secured real estate lending is not treated more harshly than unsecured corporate credit. Securitization: MBA urges revisions that would reduce unnecessary capital burdens on certain securitization exposures, including lowering the risk weight on GSE-backed securities to recognize the U.S. Treasury backstop.
Communication: Where would we be without it?
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CrossCountry’s EVP Hunter Marckwardt tells a tale of going for a simple walk with a friend and coming away with a lesson.
“In the world of business, my friend is a bit of a big deal, although humble as can be. I mention the big deal portion only to set the stage on my trust for his thoughts, suggestions, and advice. Seeking wise counsel is something we all need to consider. I’m not suggesting a resume of pedigree is required, but a resume of experience and results should always be considered.
“We walked for an hour covering a lot of ground on raising boys, being husbands, our faith, our confusions/questions on life, it was great, meaningful. As we were finishing, we were talking about having hard conversations where direct and honest communication is massively important, but also how hard those conversations can be.
“He made a comment to make his point that stuck with me, he said can you imagine saying, ‘I care about you, just not quite enough to tell you the truth.’ If you let that sit for a minute, think about how many times you dance around a subject or avoid it all together. I do it more than I care to admit. If we flip the script and recognize that not sharing constructive feedback is actually a lack of care, it changes our thought process. A great quote: ‘The opposite of love is not hate, it’s indifference.’
“My son Thomas came home for the weekend. I was telling him about my conversation with my friend and asked about him getting yelled at by his coaches. He replied, ‘I used to take it personally, now I look at it as I’m valuable enough to be coached and criticized versus no comment, if you get no comments, no feedback, you might as well quit the team.’ Same message as my friend, different context, but same message.
“Bigger relationships require bigger conversations. Bigger conversations require honesty over feelings. If you can blend the two it can be amazing, but truth over feelings. Before taking feedback personally, run it through a simple filter. Do you trust the person giving it? Do they genuinely care about you and the outcome? If the answer is yes, receive it as a gift, not an attack. These conversations are like muscles, the more you have them, the stronger they get.
We can all be the person who needs to give the honest feedback and the one receiving it. None of us get better in a box. We need people around us who care enough to tell us the truth.”
Hunted finished with advising, “This week, find the conversation you have been avoiding and have it. The person on the other end deserves your honesty far more than they deserve your comfort.”
Keep the Fed’s actions in perspective
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No one has a crystal ball, and no one can predict interest rates consistently and accurately. (Otherwise, do you think they’d be helping the rest of us?) One tweet drives rates in a different direction for months. The best we can do is understand why and how rates are moving and be able to explain that to others.
In 1994, the Federal Reserve raised interest rates seven times in 12 months, one of the most aggressive tightening cycles in modern history. While short-term rates moved sharply higher, as expected, the 30-year Treasury yield barely budged. The bond market had also already priced in its own view of where inflation, growth, and long-term policy were headed.
Fed Chairman Alan Greenspan famously called the persistence of long rates a conundrum, not because it was inexplicable back then, but because it was a sobering reminder to everyone that although the Fed controls the overnight rate, the market controls the rest.
Today’s version of that dynamic is playing out in reverse. The Fed has been cutting its overnight rate since late 2024, slashing 175bp off the federal funds rate in just over 18 months. Yet the 10-year Treasury yield is up more than 50bps over the same period. As of early May 2026, and into June, the 10-year was hovering around 4.40 percent, much higher than many borrowers had anticipated when rate cuts began.
For community financial institutions (CFIs) fielding questions from borrowers, board members, and colleagues, this divergence demands a clear, confident explanation. The good news? The mechanics behind this are very understandable and knowing them is a genuine competitive advantage in all client conversations.
Remember that the Fed controls only one rate… The Federal Reserve directly sets the Federal Funds overnight rate, or the rate at which banks lend excess reserves to each other, anchoring the very front end of the yield curve. Instruments like overnight repo, one-month T-bills, and money market funds are highly correlated with the fed funds rate because their maturities are short enough that the policy rate dominates pricing.
Longer-term treasuries, like the 10-year, and mortgages, are a different animal. Those yields reflect what the bond market collectively believes the average short-term rates will be over the stated maturity, with adjustments for the risks of holding long-term debt. Those expectations are shaped by dozens of variables (e.g., inflation forecasts, growth projections, fiscal policy, global capital flows, etc.) that the Fed does not control.
Medium-term treasuries, like the 5-year and which many MBS traders use in pricing mortgage-backed securities, sit somewhere in between, more responsive to near-term Fed signals than the 10-year, but less anchored to overnight policy than the very front end. The longer the maturity, the more the market (and not the Fed) is in charge.
Fewer cuts mean higher long-term yields! When the Fed began cutting rates in late 2024, markets initially priced in an aggressive easing cycle, expecting multiple cuts well into 2025 and 2026. But when economic data came in stronger than expected, and inflation proved stickier than anticipated, investors revised the number of cuts downward and then eliminated them entirely.
When the Federal Reserve began lowering rates in late 2024, market participants anticipated a relatively active easing cycle. Since then, expectations have shifted. The Fed maintained its target range at 3.50–3.75 percent during its March and April 2026 meetings, and following a higher-than-expected inflation reading, data from CME FedWatch indicates a low probability of rate cuts this year, with some market participants now anticipating no reductions. Persistent inflation, higher oil prices linked to geopolitical developments involving Iran, and the prospect of a Federal Reserve leadership transition have all contributed to the evolving outlook.
This repricing matters for long-term yields. When market expectations change, in this case few overall cuts, longer term yields increase to reflect that new baseline…even if the Fed isn’t actively hiking today. In other words, the bond market isn’t reacting to what the Fed did at its last meeting but rather expressing a view about what policy will look like over the next decade. When those expectations shift, long-term yields shift with them, independent of near-term policy moves.
Father’s Day is tomorrow. It’s a good day, not necessarily for cards or Brut Cologne, to remember the significance of your Dad, as noted in the opening paragraph, but also how sometimes he needs help, as exemplified in this short video.
Visit www.ChrismanCommentary.com for more information on our industry partners, access archived commentaries, or subscribe to the Daily Mortgage News and Commentary. You can also explore the Chrisman Marketplace, a centralized hub connecting mortgage professionals with trusted vendors and solutions. If you’re interested, check out my periodic blog on the STRATMOR Group website. STRATMOR’s current blog is “Pricing That Can Help Borrowers.” The Commentary’s podcast is available on all major platforms, including Apple and Spotify.
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(Market data provided in partnership with MBS Live. For free job postings and to view candidate resumes, visit the Chrisman Job Board. This newsletter is intended for sophisticated mortgage professionals only. There are no paid endorsements by me. For the latest mortgage news, visit Mortgage News Daily. For archived commentaries, or to subscribe, go to www.ChrismanCommentary.com. Copyright 2026 Chrisman LLC. All rights reserved. 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.)
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