- November 2, 2022
- Posted by: Bastion team
- Category: World News
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Wednesday, Nov. 2, 2022
Today’s newsletter is by Janna Herron, Yahoo Finance’s personal finance editor. Follow Janna on Twitter @JannaHerron. Read this and more market news on the go with Yahoo Finance App.
It’s no secret the mortgage market is getting hammered.
Just look at last week’s stats on new home sales and pending ones and you immediately see the ramifications of 7% mortgage rates on housing activity.
But it’s not just skittish homebuyers who are smothering mortgage lenders. It’s largely the non-existent refinance market — down around 85% from last year — as nearly no homeowner wants to sacrifice their 3% mortgage rate they secured in the last two years. Overall, mortgage activity is at its lowest point since before the turn of the millennium in 1997.
For mortgage lenders — especially nonbank ones that don’t have many non-mortgage revenue sources — this is a big problem. For instance, Mr. Cooper (COOP) logged a 26.6% drop in originations in the third quarter from the previous one. Next to report earnings are Rocket Mortgage (RKT) on Thursday, United Wholesale Mortgage (UWMC) on Friday, and loanDepot (LDI) and Home Point Capital (HMPT) next week.
So how do these lenders keep on ticking beyond cutting workers? A few other line items may hold a lifeline through this slump.
While originations remain sluggish,…