Hedging, Data Mapping, BER Letter, PPE Tools; AI Ramifications; Atty. Mitch Kider Joins Big Picture

Nearly every lender is at least learning about AI, but on the flip side there are things like New York’s ban on data centers. Lenders and vendors are not the only ones riding the tech wave, and no LO wants to be behind their client in tech knowledge. Consumers are now researching affordability, neighborhoods, and monthly payments long before contacting a lender. So, the next competitive advantage in mortgage lending lies in engaging buyers earlier through real-time affordability tools, personalized insights, and integrated financing experiences that build trust before rate shopping begins. In today’s purchase-driven market, where monthly payment matters more than purchase price, lenders that help consumers make informed decisions from the outset are better positioned to win business and improve outcomes for borrowers, agents, and loan officers alike. Put another way, the future belongs to lenders that combine advanced technology with human expertise, earning consumer trust early and serving as trusted advisors throughout the entire homeownership journey rather than simply processing mortgage transactions. (Today’s podcast can be found here… this week’s ‘casts are sponsored by Zillow Home Loans, Zillow’s in-house mortgage lender. By integrating Zillow’s real estate platform with financing, Zillow Home Loans helps buyers move from dreaming about a home to holding the keys, and loan officers focus on guiding buyers with care and confidence. Today’s has an interview with Polunsky Beitel Green’s Allan Polunsky, Jay Beitel, and Marty Green on the evolution of the mortgage industry from a legal perspective over the past five decades, and the legal and regulatory challenges lenders face today.)

Lender and Broker Software, Products, and Services

Does your pricing engine create more friction than flow? When locks stall, pricing needs repeated validation, and teams step outside the loan to keep work moving. Small inefficiencies compound into systemic drag that slows execution, reduces volume, and increases margin risk. These are not isolated issues; they may signal your PPE is working against you. The Optimal Blue® PPE helps eliminate those roadblocks with real-time pricing accuracy, seamless in-loan workflows, and intelligent automation that keeps the lending process connected from price through lock. With aligned data, modern LOS integrations, and AI-powered monitoring, lenders gain speed, confidence, and clarity across every loan. Move from friction to flow with a PPE built for today’s lending demands. See what modern should look like and take control of your execution with the Optimal Blue PPE.

Our friends Joe Garrett, Mike McAuley, and Steve Stone at Garrett, McAuley & Co. have been helping lenders make sense of the servicing world for a long time, and they’ve just rolled out something genuinely useful. It’s called PULSE, a free, confidential Subservicer Health Check. In under ten minutes it tells you how your subservicer is actually performing, benchmarked against other lenders, not just what shows up in the monthly report. If subservicing is on your plate, take the PULSE Health Check here.

AmeriHome is raising the bar with exciting enhancements to its non-Agency product suite. Connect with them to learn about expanded AUS Jumbo eligibility featuring higher loan amounts, new DSCR-eligible property types, including Non-Warrantable Condos and increased maximum pricing caps on select products – and that’s not all! AmeriHome is now available on LoanNEX! Through this new partnership, approved Sellers can gain access to competitive financing solutions designed to help drive volume, increase flexibility, and improve efficiency. Connect with them to learn more! Are You Ready for UAD 3.6?  Join experts from Freddie Mac and AmeriHome for a must-attend webinar on July 22 at 10AM PT where we’ll break down what’s changing with UAD 3.6, critical timelines you need to plan for, and immediate steps to prepare your systems, workflows, and partners. Reserve your spot today!

“Markets, borrowers, and opportunities change. The next opportunity may already be in your database. A loan that didn’t work six months ago may be worth another look today. Join Arc Home on Wednesday, July 22 at 2:00 PM ET for a webinar focused on finding more opportunities in your existing database. We’ll review updated Clean Slate Full Doc and Alt Doc programs and our new Clean Slate DSCR for borrowers with past credit events. We’ll also cover our new Closed-End Second for brokers and HomeEQ, our digital HELOC for Correspondent. See how strong pricing, technology and personal support can help you win even more second-lien business without replacing a homeowner’s first mortgage. Through real borrower scenarios, we’ll show where each solution fits and which past clients, previous declines and existing leads may deserve another conversation. More loans from the leads you already have. Register today.”

Truework, a Checkr Company, is the unified income, employment, and asset verification platform built for mortgage lenders, replacing slow, manual processes with fast and automated reports pulled directly from payroll providers and other authoritative data sources. Lenders see up to 50 percent cost savings on verifications, with faster turn times and higher accuracy. Trusted by 4 of the top 5 lenders in the US, Truework delivers verification results your team can rely on. Learn more.

Planet non-Agency correspondent is built around the way you do business, offering operational flexibility and support from underwriting through servicing. Choose delegated or non-delegated delivery based on each loan and your business needs. Before loan submission, leverage our scenario desk for bank statement income calculations, non-warrantable condo approvals, and quick evaluations of complex lending scenarios. Forward commitments, flexible reliance letter options, and rated residential and commercial servicing platforms give you the operational flexibility and specialized expertise to support your non-Agency business at every stage of the loan lifecycle. Heading to Western Secondary? Schedule a meeting with SVP Correspondent Sales Jason Mac Gloan, or SVP Non-Agency Lending Tim Fisher, or Regional Sales Managers Jennifer Salsbury Caldwell, or Tiffany Ta.

It’s no secret, CPAs hate writing mortgage letters for NonQM Loans. They’re too busy doing taxes and don’t know what verbiage lenders are looking for. National EA Solutions knows exactly what lenders require and can turn around your Business Expense Ratio letters and other accountant letters in 24 hours. Save the back and forth with underwriting. Our EAs are licensed in all 50 states, understand lender guidelines and know exactly how to write verification letters that lenders accept the first time. Click here to order your verification letter today!

“Tired of the stress that comes with preparing your quarterly MBFRF and MCR reports? Every quarter, mortgage lenders juggle tight deadlines, resource management, and data accuracy. But it doesn’t have to be a hassle. With RM Select, we streamline the entire process. Our experts handle everything from data mapping to managing roll forwards and rounding, delivering ready-to-upload reports that save you time and effort. Say goodbye to quarterly reporting headache—we’ve got it covered. Read our blog to learn more and contact info@richeymay.com to schedule a demo.”

The Chrisman Marketplace is a centralized hub for vendors and service providers across the industry to be viewed by lenders in a very cost-effective manner. We’re adding new providers daily, so check back often to see what’s new. To reserve your place or learn more, contact us at info@chrismancommentary.com.

AI’s Ripple Effect is Being Felt

Today on The Big Picture at noon PT, Laird Nossuli and Bernard Nossuli, CEO and COO of iEmergent, respectively, join attorney Mitch Kider and Rob Chrisman for a conversation on market intelligence and strategic growth. The discussion explores how lenders can use data, often driven by AI, to identify opportunities, adapt to changing demographics, and make smarter business decisions.

Tomorrow on the Last Word at 10AM PT, Brian Vieaux, Kevin Peranio, Christy Soukhamneut, and Coby Hakalir break down the week’s biggest market signals, agency developments, AI’s impact on lenders, and industry storylines. The discussion focuses on what the industry got right, what it missed, and what lenders should be watching next.

Yes, artificial intelligence is beginning to move beyond basic productivity tools and into core mortgage operations, with the most promising applications emerging in voice automation, document intelligence, and pre-underwriting rather than replacing loan officers or underwriters.

AI agents are increasingly qualifying leads, handling inbound and outbound borrower communications, reviewing loan files, identifying missing documentation, and automating as much as 80 percent of repetitive underwriting tasks; reducing loan review times from roughly four hours to under one hour while allowing staff to focus on higher-value work that requires human judgment. Forward-thinking lenders are also connecting front- and back-office workflows, enabling AI to immediately identify documentation deficiencies and contact borrowers within minutes, significantly shortening loan cycle times, and improving the borrower experience.

Despite the rapid pace of technological advancement, industry adoption remains in its early stages, with many lenders still limited to general-purpose AI tools rather than production-ready mortgage applications. For mortgage executives, evaluate AI vendors based on proven production deployments rather than polished demonstrations; prioritize providers with deep mortgage expertise capable of handling complex regulatory and underwriting scenarios; and make data security, privacy, and model governance non-negotiable, ensuring borrower information is never used to train public or competing AI models.

Ultimately, the greatest competitive advantage may not come from AI itself, but from lenders willing to rethink traditional workflows, accelerate borrower engagement, and use automation to enhance (not replace!) the human expertise that remains central to successful mortgage origination and servicing.

Capital Markets

As borrowers increasingly shop rate aggregators before ever talking to a loan officer, the margin a lender captures on execution is what funds the ability to compete on price. In MCT’s case study, How American Federal Mortgage Captures a 25 BPS Lift Over Best Efforts with MCT, readers will see how COO Mark Young’s team combined MCT’s pricing engine, real-time best execution, and hands-on advisory to sustain a 25 basis point lift over best efforts across two years, the same average opportunity MCT sees for lenders moving from best efforts to mandatory. The case study details how that lift has funded reinvestment in marketing and pricing flexibility, helping American Federal Mortgage grow from roughly $450 million toward a targeted $600 million in production this year, while ongoing monitoring of pull-through and margin keeps the desk informed on where it stands.

Turning to interest rates, and therefore the bond market, a second consecutive downside surprise in inflation data (PPI decreased 0.3 percent month-over-month in June) reinforced the bond market’s conviction that the Fed is unlikely to hike rates later this month, allowing Agency MBS and U.S. Treasuries to rally yesterday, led by shorter maturities. Treasury prices also benefited from moderating oil prices and comments from New York Fed President Williams suggesting inflation may have peaked. Agency MBS outperformed Treasuries as spreads tightened and higher-coupon securities led gains despite light summer trading volumes. At the same time, unusually wide TBA bid-ask spreads highlighted the importance of discipline in a market where traders should rely on multiple pricing sources, actively negotiate with dealers, and cultivate strong counterparty relationships rather than passively accepting quoted levels in a seasonally illiquid environment.

On the Fed front, Chair Warsh’s Senate testimony offered no new policy signals, leaving markets focused on incoming economic data. The latest Beige Book portrayed an economy that continues to expand at a modest pace despite persistent crosscurrents, with consumer spending, manufacturing, construction, healthcare, and professional services supporting growth even as higher fuel costs, tariffs, and geopolitical uncertainty weigh on discretionary spending and profit margins. Labor markets remain stable with modest hiring and wage growth, while inflation pressures are still elevated but generally moderating as price increases slowed or held steady across all districts despite rising input costs. Overall, the report reinforced a “steady but cautious” tone; one of resilient growth, gradually easing inflation, stable financial conditions, and a Fed likely to remain patient as it monitors evolving risks.

Mortgage credit availability tightened again in June, falling to its lowest level of the year as lenders pulled back on FHA and VA streamline refinance programs, particularly for higher-risk borrowers, leaving government-backed lending standards nearly 4 percent tighter than at the start of the year and 46 percent below pre-pandemic levels. Yet despite more restrictive credit, affordability pressures continue to shift mortgage production toward Ginnie Mae, whose share of Agency issuance has reached record highs as borrowers increasingly rely on FHA and VA financing over conventional loans. For MBS investors, this changing issuance mix is reshaping risk profiles, as Ginnie Mae borrowers generally have lower credit scores and higher delinquency rates, while slowing home price appreciation is also tempering loan size growth across both government and conventional production.

Today’s economic calendar kicked off with the July Philadelphia Fed Index (optimistic), weekly jobless claims (208k, so the job market continues to be strong), and June Retail Sales (+.2 percent, ex-auto -.2 percent, about as expected). June retail sales were expected to post a modest headline decline of 0.3 percent due to lower gasoline prices. Underlying consumer spending remained resilient, supported by solid gains in auto sales and other core retail categories. Later today brings May Business Inventories, the July NAHB Housing Market Index, June Pending Home Sales and Fed remarks from Dallas Fed President Logan, Kansas City President Schmid, and Vice Chair for Supervision Jefferson. We begin the day with Agency MBS prices slightly down (worse) from Wednesday’s close, the 2-year yielding 4.16, and the 10-year yielding 4.58 after closing yesterday at 4.55 percent.