In this solo video, Jordan Keck delivers a weekly market briefing for homeowners, borrowers, and mortgage professionals. He begins by noting the upcoming Martin Luther King Jr. holiday and its effect on bank closings and rescission periods. He reports that average mortgage rates slipped to 7.07% after a high of 7.26% earlier in the week, attributing the recent dip to softer CPI data. Keck introduces mortgage recasting – a one‑time principal lump‑sum payment that triggers a re‑amortization to lower monthly payments without refinancing – outlining eligibility, typical fees, and loan‑type restrictions. He then discusses broader market themes, emphasizing a “higher‑for‑longer” rate narrative driven by stronger‑than‑expected job numbers and the uncertainty of future Fed cuts. Detailed CPI figures are presented: December headline inflation rose 0.1% YoY to 2.9% (vs. expectations), while core inflation rose only 0.2% YoY, dropping to 3.2% YoY, which helped rates rally lower. Keck reviews Mortgage Bankers Association data showing purchase applications up 27% week‑over‑week (down 2% YoY) and refinance applications up 44% week‑over‑week (up 22% YoY), noting the holiday‑week distortion. Retail sales for December increased 0.4% (below the 0.6% forecast) with core sales up 0.7%, further supporting rate declines. Finally, he reports initial jobless claims at 14,217 (low) and continuing claims falling to 1.86 million, describing the labor market as relatively quiet. He closes by encouraging viewers to share the update and sign up for future briefings.
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Good morning and happy Friday! Jordan Keck here, your lender buddy, with your weekly market update. Kicking off, I want to remind you that Monday is a holiday, Martin Luther King Jr. Day, so banks will be closed. I'll still be available if you need anything, but just know that there is no closings happening that day and it does not count as a waiting period day for closing disclosures and right of rescission periods for refinances. So hope you have a great long weekend, get to enjoy some time. As far as interest rates go, moving down this week from 7.15% last week to 7.07% this week. That is just a snapshot on Fridays though. We actually came down from a high of 7.26% on Monday and Tuesday. So from last Friday it went up and then back down to to overall be lower week over week. So we will take that. That's on the heels of some news from the CPI data as well as some additional data we'll talk about here shortly. As far as our weekly mortgage tip, want to talk about recasting. I had a good conversation this week with somebody who's asking about it, and a recast is where you can apply additional large principal payments to a loan after you've already gotten it, and the servicer will allow you to adjust your payments lower. They'll reamortize it so that you can lower your payments without having to refinance. Now, the alternative, usually if you just make a one-time lump sum payment, then you don't actually pay any less for your payments. You just end up paying less in interest and you pay off the loan faster than you ordinarily would have. Recast is a great tool if you're looking for a situation where a client is buying a home, they can qualify without having to sell their current home, or maybe they're using one of our Buy Before You Sell programs. But they know they're going to have a large amount of money to put towards the loan later, and they want their payments to be lower. Recast is a great option for that. There's usually just a one-time document fee of a couple hundred bucks, and depending on the loan servicer, they may have a minimum amount of either $10,000, $5,000, $20,000 that goes towards principal, or a waiting period of maybe up to 6 months. But great option available there. Note that this is not applicable on all types of loans. Typically, it's only going to be conventional loans that allow it, and the terms are different with each servicer. So note that often it's only allowed one time for the life of the loan, and each servicer being different, it's not a guaranteed benefit written into the loan documents. It's an exception often allowed by the servicer. So if you're curious about it, have any clients who are interested in something like that, let me know. Happy to walk through and see if it makes sense. First up on our notes for this week, big picture trend here. There is a shift in the jobs trend and mortgage rates trending higher overall. I think that there's more and more of this narrative here of higher for longer. There was hope that there would be more interest rate cuts in this year. That is possible. But we did see some higher job numbers, especially last week with the Bureau of Labor Statistics jobs reports coming in significantly higher, that there's more incentive, there's more narrative in the market here about Maybe we don't get any Fed rate cuts, maybe the rates do stay higher for longer. And that's something that I would continually just say, we don't know where the market's going to go. We know home prices will go up long term. We don't know where interest rates are going to go. Lock in what you can now. And if rates go down, it's a nice benefit. If they go up, you're protected. But as always, here as professionals, we're guiding our clients on how to think about making decisions now in the face of unknown future data. Trying to predict what's going to happen is a losing game. It's gambling at best. Yes, maybe you get lucky, but nobody can predict perfectly, as we've obviously seen with the market the last few years here. We saw low rates, you know, a little bit of a dip back in September, but other than that, longer-term trend has been towards higher rates. So expect that to continue, and hopefully we are disappointed if that doesn't happen, but at least we're prepared for whatever that may be. Bring. So I just plan on them staying the same or going higher, and then we'll be wherever the market will be. We will adjust accordingly. That's what we do. The CPI— this was actually a really good one coming in this week, which rallied a lot of the rates here to move lower from their highs earlier in the week. CPI inflation for December came in only up 0.4%, but the rate was, um, the core rate was here below expectations, and that's really what inspired the markets to rally. The headline number, it was 0.1% above what was expected, year-over-year increase from 2.7% to 2.9%, but the core rate, which strips out food and energy prices, only increased 0.2%, which was down from the expected amount of 0.3%, leaving the core rate to drop year-over-year from 3.3% to 3.2% when it was expected to stay the same, and that was enough for markets to be able to rally and help improve interest rates there. Next up, the MBA, the Mortgage Bankers Association, reported that purchase mortgage applications were up 27% last week, down 2% year over year. Refinances were also up 44% week over week to be up 22% year over year. While this was a big spike, take it with a grain of salt because they're comparing this to the week prior, which was a holiday week. So I'm guessing next week we're gonna see a comparison, but two full weeks here. And not see nearly as much volatility and change between those two. Lastly here, retail sales for December rose 0.4% below estimates of 0.6%, and this was further fuel in the fire of helping mortgage rates to rally with news that was beating the expectations there in a positive way for mortgage rates. Additionally, November's numbers were revised lower by 0.1%, adding to that weakness on the report, which means good news for rates continuing again that rally that was started by the CPI on Thursday. Core retail sales were up 0.7% versus the 0.4% expected, so higher on that front. But so far it seems like the markets are taking into account the headline number for the most market moving. And lastly, initial jobless claims— not a whole lot happening here. Initial claims up 14,217, which is still a very low number. Continuing claims falling 18 to $18,000 to $1.86 million. Not much happening here. You know, new claims still fairly low, continuing claims still high, but not as high as they have been. So a bit of a snooze fest overall there. As always, hopefully this is helpful for you. If you know anybody that would like to get the same information, pass it along to them. They can sign up to get it regularly if they're not already with the links below. And hope you have a great long weekend. We'll see you next time. Take care.
