Jordan Keck reports mortgage rates rose to 6.91% and warns that missed student loan payments can disqualify borrowers from government-backed mortgages. The Fed held rates steady citing tariffs as an inflation risk, the US and UK cut car tariffs from 27.5% to 10%, and March home prices climbed 0.6% month-over-month, beating forecasts.
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Good morning and happy Friday. Jordan Keck here, your lender buddy, with your weekly market update. Remember, this weekend is Mother's Day weekend as well, so this is probably your last chance to get something if you haven't already. Make sure that you are not missing out on that. First, interest rates this week moving up a little bit from last week. Moving from 6.83% to 6.91%. That's the national average for lenders across the country for conventional top-tier scenarios. So again, every lender is going to be a little bit different on that. Every scenario is going to be different. And so if you have specific scenarios, check with me. That is not a rate quote. That is an indication of where the market is moving. As far as the weekly mortgage tip, I wanted to talk about federal debt delinquencies. Especially right now, as the student loans are coming out of deferment after being in deferment for years. A lot of servicers are not doing a great job of handling this. And as a result, you've got millions and millions of borrowers who are delinquent on their student loans, maybe not even because they were aware of it. So this is something especially for you, if you haven't already been checking your student loans, if you have them, or your clients haven't been checking them, make sure that they know if those payments have come due again, because a lot of the times people aren't even being notified or they're not being notified very well. So that prompts this discussion. If it's a federal student loan, being delinquent on that means you're delinquent on federal debt, and that can affect your ability to get federal debt in other areas, namely a home loan. Conventional loan through Fannie Mae, Freddie Mac, you know, VA and FHA and USDA loans, those are technically all government-backed loans. And so if you have delinquencies on federal debt, it may impact your ability to be able to get a home loan. Now, just because you're 30 days late doesn't mean that you're necessarily going to not be able to get a home loan. Sometimes it might just be as simple as getting paid up or it can be ignored, but especially if it's ever gone into special collections, there's any kind of a judgment or lien against you as a result of that. And this is, I've seen times that if you've gotten an SBA loan in the past for business and been delinquent, that is something that can stay on the record there and could affect your ability to get a home loan. So again, especially with student loans, big thing to keep in mind, want to make sure that people are up to date on those. You're watching them and advising your clients to do the same. As far as rates this week, the Federal Reserve met and left their overnight interest rates the same for their bank funding rate. That was pretty much expected. There wasn't really any expectation that they would change rates up or down. But what was interesting is how much they talked about waiting. You know, during this meeting, Fed Chair Powell used the term waiting 22 times, indicating that they really don't want to see rate cuts too soon with as much uncertainty as there is right now. They've been very vocal about the fact that they believe tariffs are fighting against their move towards lower inflation numbers. They think tariffs are going to be inflationary, and they'll really change the tone for rate cut expectations moving into the future at this meeting. Next up, the US did reach a trade deal with the UK. As a result of that, the US will lower tariffs from 27.5% to 10% on several goods from the UK, significantly the biggest one that on its cars. The UK will also eliminate tariffs on US ethanol used for fermented drinks, beer, wine, things like that. And both countries get improved access to each other's agricultural markets. Talks will continue for a broader agreement. This isn't a comprehensive agreement. But in the short term, it does introduce volatility, which isn't helping the bond and the mortgage market. So that's one of the components we saw towards that higher amount for rates in addition to the Fed talks. Now, the US and China haven't reached any kind of agreement yet, but the US Secretary, US Treasury Secretary, and Chinese Premier are going to be meeting in Switzerland for the first time this weekend to be able to have discussions about de-escalating the trade war between the two largest economies in the world. This is the first actual confirmed conversation between the two countries about this ever since the US imposed a 145% tariff on China, virtually halting all trade. Again, the goal on this is to really de-escalate the trade war that's been happening, see if they can come to some kind of agreement like the US did with the UK. Next up, Cotality, which used to be called CoreLogic. They, they reported home prices up 0.6% for the month of March. Year over year, we're now up 2.5%, which is a decline from the previous report showing 2.9%, meaning that prices are still up year over year, just not accelerating at the same pace they were a month prior. Now, that being said, Cotality had previously forecasted a number for the month of 0.4%, so this came in 50% higher than their expectations. Because of that, they also increased their April forecast to 0.9%, so almost a full 1% appreciation in the month alone. And a 12-month forecast of 4.9%. This is a big increase from the previous forecast they had of 4.2% in their last report, showing that they believe there's some continued strength in the market and that that's going to be accelerating going forward. As always, hopefully this is helpful. Have a great weekend. We'll see you next time. Take care.
