Servicing, Non-Agency, AI Processing Tools; Condo Turmoil Ahead?
There’s always something in the news, whether it is Jimothy the raccoon in the Northwest, or the Canadian wildfire smoke in the Northeast which coincided with more tariffs directed at Canada. Homebuilders, and those who lend to them, know that materials from Canada are already subject to tariffs, but the new tariffs could affect building materials such as (primarily) cement, doors, heating and ventilation equipment, glass, and plywood products. Speaking of building, the artificial intelligence boom in the United States is being matched by a data center building boom. There are more than 3,000 data centers in the U.S. and another 1,500 in development, according to a Pew Research Center analysis. Properties and land are being consumed by using Eminent Domain (for the public use?), once again demonstrating the intersection of the government, law, and lending. Today, on Lender One’s Mortgage Matters at 11AM PT, Mitchell Sandler's Ari Karen discusses the mortgage litigation space, potential updates to RESPA, and storm clouds with AI from a legal perspective. (Today’s podcast can be found here. This week’s ‘casts are sponsored by JazzX, the first true end-to-end AI platform built for mortgage. From application to closing, JazzX is a new operating model that helps you scale growth, boost productivity, and transform how your team performs. Today’s has an Interview with Pivot Financial's Jennifer McGuinness-Lubbert on the importance of data integration, diversification beyond traditional Agency products to meet borrower needs, and customer-centric approaches in the evolving mortgage landscape.)
Lender and Broker Software, Products, and Services
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.
The world has changed, and lenders betting on the wrong AI vendors are at existential risk of not surviving what's coming. Most lenders think they're "AI-first" because they're swapping old LOS and POS software for new, automating minor steps, and bolting on AI agents that don't move the needle. That's false comfort. The real test is brutal: if you aren't eliminating entire positions, creating unlimited capacity, and proving substantial dollars saved, you're falling behind. AIify-it is transforming how mortgage lenders operate through what they call "out-of-app AI." It eliminates entire job functions, roles, and workflows, automating them for instant outcomes at unlimited scale. The reason they succeed is simple: 30 years in the trenches building retail, wholesale, correspondent, and servicing shops responsible for $70 billion+ in loans funded, not technologists pretending to understand what they're trying to automate. They already have clients who can prove it. Reach out to sara@aiifyit.com.
Automating individual tasks isn't the same as transforming mortgage operations. Real efficiency comes from connecting people, policies, systems, and decisions across the entire loan lifecycle. JazzX AI creates a governed intelligence layer that orchestrates work from application through post-close, without replacing your LOS. See how leading lenders are reducing cost per loan and increasing throughput. Book a demo with our team to see JazzX in action.
Asset verification has long been one of the most manual, error-prone steps in underwriting. ICE recently expanded the integration between the ICE Mortgage Analyzers and Finicity, a Mastercard company that specializes in open banking and financial data verification, to help clients streamline this process. The new integration pulls verified asset data directly from financial institutions into the underwriting workflow, automatically calculating assets and flagging large deposits. This enhancement can help reduce file defects, improve cycle times and lower repurchase risk. Read the blog here.
Symmetry can offer up to 1-million-dollar HELOCs on a primary home with 75 percent max CLTV and 720+ mid FICO. This is allowed on a piggyback or a first lien standalone! We don't require bank statements or reserves. Help your borrowers make their dreams come true. As always, we have no PPPs or EPOs. In case you missed it, we are running a current special at Prime Minus 0.25 percent margin on Piggybacks and Standalones! This special works for 1st or 2nd liens with a minimum draw amount of $200,000, 760+ mid FICO, CLTV up to 80 percent, 5-year draw term, and primary residences only. Call your AE for details! (This post is for Mortgage Professional Use Only/Not for Distribution to the Public)
As the Non-Agency market grows increasingly complex, Newrez Correspondent continues to provide lenders with a real competitive advantage through flexible underwriting solutions, specialized products, and ongoing education opportunities. While Delegated lenders have the speed and control of managing underwriting internally, certain borrower profiles and loan scenarios can benefit from the added expertise available through Newrez’s Non-Delegated underwriting process. This support is particularly valuable in non-Agency lending, where income analysis, documentation requirements, credit exceptions, and product-specific nuances frequently require a deeper level of review. Rather than delaying decisions or declining challenging opportunities, lenders can leverage Newrez’s underwriting expertise to gain clearer guidance and a more efficient path to approval. With the introduction of the Medical Professional program and a focused non-Agency strategy encompassing Non-QM, CES, and Jumbo AUS products, Newrez is well positioned to help clients broaden their lending capabilities, serve more borrowers, and increase production with greater confidence.
AI is resetting mortgage servicing: Will your platform keep up? AI is changing mortgage servicing, but the biggest shift isn’t just smarter automation. It’s giving servicers the freedom to bring their own AI agents to the platforms they already rely on. In an article featured in National Mortgage News, Sagent President Sridhar Sharma explores why the future belongs to servicers/partners where the servicing platforms they run their operations on is compatible with a servicer’s AI strategy – not against it. From AI-powered compliance that can shrink regulatory response times from weeks to hours to flexible “Bring Your Own Agents” capabilities, the next generation of servicing is about empowering servicers with choice, speed, and control. Discover how cloud-native platforms like Dara by Sagent are evolving beyond systems of record into intelligent systems of action – helping servicers automate workflows, strengthen compliance, and deliver better homeowner outcomes.
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.
Conventional Conforming News
The industry is in a tizzy about the upcoming condo changes from the Agencies, and every LO out there is informing the condominium associations in their areas about the changes. Earlier this year we saw condo insurance changes made by Fannie Mae and Freddie Mac. Recall that on March 18, Fannie Mae and Freddie Mac announced coordinated updates tightening condominium project eligibility standards specifically directed at reserve studies and funding. Fannie Mae issued Lender Letter LL-2026-03 and Freddie Mac published Bulletin 2026-C.
These rules aim to promote better long-term financial health for communities. And reduce risks from underfunded reserves (like sudden special assessments or deferred maintenance). If associations don’t adapt, buyers may lose access to conventional financing, which can directly hurt property values.
The big shift is that the reserve funding minimum goes to 15 percent. Under the standard “Full Review” process, lenders look directly at an association’s budget. The New Rule: Condo associations must now allocate at least 15 percent (up from 10 percent) of their total annual budgeted assessment income to replacement reserves. This becomes mandatory for loan applications dated on or after January 4, 2027 (though lenders are encouraged to implement it earlier). If an association cannot or does not want to automatically dedicate 15 percent of its budget to reserves, they can still qualify if you rely on a qualifying, up-to-date professional reserve study.
But there are strict new rules for reserve studies. Using a reserve study to justify the Association’s budget flexibility comes with much stricter parameters under the new guidelines. For example, there is no more “baseline” funding. Studies using the baseline funding method (aiming to keep the cash balance just above zero) are no longer permitted by lenders. There’s the “Highest Recommendation” Rule: If the association uses a reserve study to override the 15 percent rule, the budget must follow the highest recommended reserve allocation outlined in that study.
The 3-Year Expiration Date: The reserve study (or formal update) must be no more than 36 months (3 years) old at the time of the lender’s project review. The study must be prepared by an independent third party with specific expertise. It must also feature a full component inventory, a financial analysis of current adequacy, and a compliant funding plan. These reserve study enhancements are mandatory for loan applications dated on or after August 3, 2026.
Fannie Mae and Freddie Mac are retiring the “Limited Review” (or streamlined review) process for most established condo projects on August 3, 2026. This change forces almost all established communities into a Full Review. Consequently, lenders will aggressively audit finances, reserve balances, and reserve studies.
Capital Markets
Axios’ Matt Phillips reports that, “Four months into the Iran war, bond market traders are tuning out Trump's posts on his personal social media site, Truth Social, researchers from JPMorgan show. “For the most part, his social media posts are noise, with very little ability to move the market… Although the bulk of the president's posts about the Middle East do not have a particularly dramatic effect on rates volatility on 30-minute timescales, a handful of posts coincide with volatility on this timescale well beyond what would be expected from 'normal' volatility… the reaction of rates markets to President Trump's posts about the Middle East conflict has decayed over time despite the conflict still being ongoing.
“This doesn't mean the markets can completely afford to ignore the world's most powerful politician, especially given his unprecedented willingness to personally intervene to influence markets, from posting about individual stocks to oil and energy markets. The president's social media company is reportedly planning to sell early access to the feed to Wall Street traders, who could profit from knowing ahead of time about a Truth message that might trigger volatility. Wall Street will be more than willing to pay a premium for priority access.”
Despite a sparse economic calendar this week, bond markets have experienced notable volatility driven more by geopolitics than by fundamentals. Renewed tensions in the Middle East have lifted oil prices from recent lows, raising concerns that higher gasoline prices could reverse June's welcome decline in headline inflation, even as consumer spending has remained surprisingly resilient. Mortgage-backed securities (MBS) and U.S. Treasuries remained under pressure (read: prices down/yields up) as the defensive tone continued on Tuesday, pushing the 5-year Treasury yield to a new high for the year while other yields across the curve moved closer to their 2026 peaks. Selling activity was led by the front end of the curve, with the 2-year note weakening throughout the day yesterday as renewed strength in global equities reduced demand for safe-haven assets. Although longer-dated Treasuries have proved somewhat more resilient, they are nearing key technical levels, leaving the bond market vulnerable to a broader selloff if yields break above important resistance. Some would say that the 10-year breaking above 4.60 percent qualifies as that.
Since it’s a light news week, here’s a little primer/update on Agency MBS, which behave differently from traditional bonds because homeowners' ability to refinance creates embedded prepayment options, making MBS prices and durations respond nonlinearly to interest rate changes. That dynamic explains why investors favor stable rate environments, as they reduce hedging costs and prepayment uncertainty, while today's elevated mortgage rates have pushed many legacy low-coupon securities so far out of the money that negative convexity has largely dissipated, leaving the broader MBS market with an unusually benign convexity profile. However, higher-coupon MBS still carry meaningful extension and prepayment risk, making pool composition increasingly important, since loans with note rates close to prevailing mortgage rates can continue to refinance even when the broader coupon appears out of the money.
Today’s economic calendar kicked off with mortgage applications from MBA, which rose 1.9 percent last week as a solid 6 percent increase in purchase applications more than offset a modest decline in refinancing. Put another way, purchase demand remains resilient despite elevated borrowing costs. Even with the average 30-year conforming mortgage rate climbing to 6.69 percent for this survey, its highest level since last August, purchase applications edged above year-ago levels, while refinance activity remains modestly higher than a year earlier.
As you’ve probably heard, this week is a very light data week; accordingly, the only other economic release of note today is weekly crude oil inventories. There will also be an auction of $13 billion 20-year Treasury bonds. We begin the day with Agency MBS prices little changed from Tuesday’s close, the 2-year yielding 4.26, and the 10-year unchanged, yielding 4.63.