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BLUELINE Blog

Downside Risks in the Mortgage Market

Published April 7, 2020

The COVID-19 pandemic is not a housing crisis in its nature, but there are several places throughout the industry where the pandemic or policy response to it has hit at some vulnerabilities in the market. For the most part, these vulnerabilities tend [...]

The CARES Act and its Impact on the Economy and the Mortgage Market

Published April 3, 2020

There are two primary concerns for the mortgage industry in regard to the pandemic: one is the secondary market losing liquidity and the primary market drying up; the other is the possibility that the pandemic will cause a wave of unemployment and lack [...]

Recent Actions Taken in Response to the COVID-19 Pandemic

The Federal Reserve (FED) has had a busy past few weeks. Since lowering the Fed Funds Rate1 and announcing their first Quantitative Easing (QE)2 actions of this crisis, they have taken several other actions to maintain liquidity and confidence in the economy. Many of these [...]

Emergency Actions in Response to COVID-19 & the Implications of the Policy Actions

In response to the COVID-19 (Coronavirus Disease 2019) pandemic, global economic conditions, and the economic uncertainty that social isolation protocols have induced, the Federal Reserve Open Market Committee (FOMC) just made its second emergency rate cut over the past two [...]

Market Commentary: The Impact of Rate Movement and Loan Characteristics on Servicing Value

In terms of the secondary market, a mortgage loan is essentially made up of two separate parts, the loan asset and the servicing asset – which may be split up, packaged, and sold separately. The largest of the two pieces is the loan asset, which is cashflow of the loan [...]

Market Commentary: The Impact of Rates, Seasonality, and Appreciation on Mortgage Volumes

Mortgage originations are booming! While this is primarily fueled by the most recent refi boom, there are other aspects to this that, right now, are also favorable and adding fuel to the fire. The loan purpose is one of the main determinants of how volume will be affected by [...]

Market Commentary: The Impact of Low Rates on Lender Profitability

Consider the direct impact of our recent favorable rate trend on lender profitability. In the paragraphs below, we examine how lower mortgage rates can equate to higher margins for lenders as seen through the primary-secondary spread.

Market Commentary: Monetary Policy Impact on the Mortgage Market

U.S. monetary policy is the purview of the Federal Reserve (Fed) and is broadly responsible for the health and stability of the economy. The Federal Reserve Open Market Committee (FOMC) is the group that decides the monetary policy that the Fed will implement in order to [...]

Market Commentary: Rates Falling, Are Volumes Responding?

Optimal Blue recently released a suite of indices known as the Optimal Blue Mortgage Market Indices (OBMMI™). These indices are calculated from actual locked rates with consumers across more than 30% of all mortgage transactions nationwide and are developed around the most [...]