In this weekly market briefing, Jordan Keck introduces his expanded commercial lending services for properties with more than five units, then reviews current mortgage rate movements (7.07% last week, 7.11% this week) and provides a mortgage tip on FHA and VA loan assumptions, outlining eligibility, cash requirements, and veteran eligibility implications. He reports December existing home sales up 2.2% month‑over‑month, a 9.3% year‑over‑year increase, and a 13.5% inventory decline, while noting inventory remains 16.5% above the prior year. CoreLogic’s rental index shows a 1.5% year‑over‑year rent increase in November, a slight slowdown from October, and discusses the lag between rent growth and CPI/PCE inflation measures. Jobless claims data reveal initial claims rising 6,000 to 223,000 (steady) and continuing claims jumping 46,000 to 1.899 million, indicating persistent labor market weakness. Finally, Keck explains the CFPB’s lawsuit against Rocket Mortgage, Rocket Real Estate Group, and Jason Mitchell Real Estate Group for alleged illegal referral‑steering and restrictions on sharing lender information, highlighting the regulatory significance under RESPA. The update concludes with a friendly sign‑off.
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Good morning and happy Friday. Jordan Keck here, your lender buddy, with your weekly market update. Quick reminder as well for anybody who is dealing with properties that are over 5 units, I am now broken commercial transactions as well. So got some great deals already in the pipeline, been able to help some clients save hundreds of thousands of dollars. By shopping around compared to what they've been doing. So you're looking for new construction, again, residential, commercial developments on it, whether it's rehab, a bridge loan financing, or permanent financing, let me know, happy to take care of you. As far as interest rates this week, moving up slightly overall, pretty steady though. Last week at 7.07%, this week at 7.11%. And again, a little bit of volatility going on, seen some good days, but not really seen a whole lot of big movements. So we'll take some stability. Weekly mortgage tip, we want to talk about FHA and VA loan assumptions. So not as common, but it's still pretty common out there to see homes being advertised as having an assumable loan. So conventional loans, not going to be assumable, but an FHA or a VA loan is assumable by a new buyer. So what does that mean? It means that buyer can qualify through the current lender, the current servicing company, You can't use whoever you want, you have to go through the current servicing company, get approved, and overtake that current loan at its exact balance and interest rate. Especially if that interest rate's been around for a few years, it could be significantly below what the market rates are. The drawbacks on this though are that you usually have to cover the difference between that loan amount and the purchase price with cash. Now that means someone had a $200,000 loan amount on a property being sold for $300,000, You've got to bring that extra $100,000 in cash in order to assume that loan. A couple things to note on these: FHA does have some time frames they have to abide by. Typically within 30 to 45 days, that can be done. VA doesn't necessarily have those same time frames, so it could take longer, and both the buyer and seller have to be very active and on top of the servicing company to facilitate this from happening. Another thing to keep in mind, if it's a VA loan that's currently on the property, you don't have to be a veteran to assume that loan. The big difference is if you are a veteran, then that loan will attach to your eligibility, and the seller regains their eligibility to use their VA loan on another property. If the person who's assuming the loan is not a veteran, then the seller leaves their VA eligibility with that home until it's paid off or refinanced. So they wouldn't be able to use that same eligibility to go buy another home with a VA loan. That being said, there might be opportunities where they can still have a VA loan on multiple properties, but that portion of their eligibility stays with that home if the person assuming it is not a veteran. If you have more questions about this, let me know. Happy to help. Just remember, I can't really help facilitate that process because it has to go through whatever the servicing company is who currently has that loan. Next up, existing home sales for December, up 2.2% for the month. This was above estimates. A lot of this is likely because we saw those who were shopping in October and November benefiting from, from the lower rates at that time. This was about a 4.24 million annualized pace, which is the strongest we've seen in the year since February. Year-over-year sales are up 9.3%, which is the strongest since June of 2021. On top of that, we saw inventory fell about 13.5% last month, even though it's still up 16.5% year-over-year, well below the pre-pandemic norms. So again, the monthly difference on it— who's wanting to list their home in December? So again, that's just kind of the normal cyclical aspect. Next up, rental index from CoreLogic showed rents up 1.5% year over year in November. This is slightly slower than the 1.7% seen in October, as we're continuing to see this trend towards slower deceleration of rent growth. Still going to be increases year over year, but not as much as we've seen previously. As you've been following for a while, you know that we haven't really seen this catch up in the Consumer Price Index and the personal consumption expenditures inflation data, which are still showing rents above 3% and 4%. So hopefully that delayed effect will continually get caught up with the current market and see those inflation numbers decline. Initial jobless claims rose 6,000 to 223,000, very— staying fairly steady, but continuing claims rose 46,000 to 1.889— excuse me, 1.899 million. Big jump on those continuing claims as it continues to hover around the highest levels it's been in around 4 years without really seeing any meaningful decline for months now. This is continuing to show that those who are laid off are having difficulty getting back into the labor market, finding new jobs, and those who are at their jobs are continuing to stay there for longer. So not seeing as big pay increases And lastly, here, wanted to touch on something that may or may not be that much in the news, but the CFPB, the Consumer Financial Protection Bureau, is suing Rocket Mortgage and Rocket Real Estate Group, as well as a particular real estate group, the Jason Mitchell Real Estate Group. Now, the reason for this is allegedly, according to the CFPB, between 2019 and 2024, Rocket Homes incentivized real estate brokers and agents with referrals and priority for future referrals in exchange for steering clients to Rocket Mortgage. Rocket also restricted the agents from sharing competing lender info, including details about down payment assistance programs. Now, this is interesting because while the CFPB and RESPA has always been very, very clear that those covered under RESPA— so lenders, real estate agents, title and escrow companies, All right, they're all covered by RESPA. You cannot resent, you cannot give or receive anything of value in exchange for or solicitation of a referral. That's always been very, very clear. This is the first time that the CFPB has actually gone after somebody for giving referrals in exchange for referrals, showing that giving a referral is in fact a thing of value. There's no money exchanging hands here, but they're saying because they were restricted and essentially required to give referrals in order to continue getting them. That's why they're going after them. And again, a lot of us know that's been a fairly common practice in the industry, whether or not it's been actually published. A lot of the times it's, hey, if you send them to me, I'll send them to you. And so really interesting to see if PB is now on this big level is actually going after that and saying that that is explicitly prohibited and we will take action to go after that. So something interesting to watch as that continues to play out. Hopefully this information, as always, is helpful. Hope you have a wonderful weekend. We'll see you next time. Take care.
