With mortgage rate cuts seemingly a distant mirage following the Federal Reserve’s meeting this week, the President and CEO of United Wholesale Mortgage (UWM) is optimistic that a cut this year could be very real.
On UWM’s YouTube channel, Mat Ishbia can be seen in a new video, less than four minutes long, offering #3Points.
“Higher for longer doesn’t mean higher forever,” Ishbia says in the video, getting into his first point. “We still believe there will be a rate cut before the election this year and I think it's going to be even sooner than that; that’s my personal perspective.”
This follows the Fed’s Open Market Committee meeting, during which Chairman Jerome Powell announced that the 5.25-to-5.5% benchmark rate would not budge anytime soon, as inflation is nowhere near the Fed’s 2% goal.
While economists were generally in agreement that mortgage rates have little chance of dropping much for the remainder of the year, Ishbia encouraged loan originators to buckle up.
“Get prepared,” he said. “Follow up with your past clients because when rates drop that opportunity is going to be there.”
Ishbia offered more commentary on the industry in his latter two points.
“There’s more houses for sale, values are going up," he said. "This is good for our economy, good for our industry, good for opportunities for when those refis come."
Lastly, UWM’s CEO announced a new second lien program coming from Freddie Mac that’s pending approval by the Federal Housing Financing Agency (FHFA).
“Freddie Mac wants to be able to buy certain single-family, closed-end second mortgages,” Ishbia continued. “It’s basically to help people get cash out of their house if they have a low interest rate and don’t want to do a cash-out refinance.”
The program is going to be a limited pilot to start, Ishbia pointed out, but yet another piece of good news. “The best part is Freddie Mac is out there saying how can we make things better, how do we help borrowers and loan originators be successful in this rate environment?”
