Interest rates

September's news roundup for the mortgage industry includes the impact of the Federal Reserve's rate cut on mortgage appetites, lenders continuing to launch and settle lawsuits and more.

Marc Rowan said he doesn't see a reason for the Federal Reserve to keep cutting interest rates to stimulate the U.S. economy.

Mortgage applications were up and rates were down in the wake of the Federal Reserve's interest rate cut, but experts wonder will that be enough to counteract higher housing prices.

The regional bank has already seen a large reduction in "criticized" loans, and it expects that trend to pick up as lower borrowing costs alleviate the pain in the commercial real estate sector.

After hikes pinched profits across the industry, a move in the opposite direction could be the start of a more promising trend. But bankers caution that the immediate effects of a September rate cut figure to be small.

In August's roundup of top mortgage news: The Consumer Financial Protection Bureau sides with plaintiffs against Mr. Cooper in alleged "junk fee" lawsuit, updates to 203(k) and more.

While lower rates have piqued borrower interest, most are waiting for some key events to pass before buying or refinancing, originators said.

Lower interest rates could bolster loan demand, credit quality and securities portfolios. But they could also curb lending profitability faster than they ease deposit costs, crimping net interest margins and eating into near-term profits.

Nearly 56,000 home-purchase agreements were voided in June with the underlying cause likely affordability, a Redfin report claims.

The Federal Reserve held firm on its current interest rate levels after its latest meeting, but inflation numbers are leading to talk of potential action in third and fourth quarters.

Rate locks have increased every month this year, but May's pace came in more subdued than early-year numbers, according to Mortgage Capital Trading.

The Federal Open Market Committee held the federal funds rate at current levels, citing "lack of further progress" toward meeting inflation goals.

Banks and other financial market participants have been keyed into the central bank's communications around monetary policy expectations. But in an unpredictable economy, the guidance doesn't always hit the mark.

Citigroup's earnings topped analysts' estimates as corporations tapped markets for financing and consumers leaned on credit cards.

The company reported net interest income that slightly missed analyst estimates, a sign the benefit of higher interest rates may be waning amid pressure to pay out more to depositors. Costs rose on higher compensation and an FDIC assessment.

With high deposit and borrowing costs persisting amid the Federal Reserve's campaign against inflation, lenders face stress on their net interest margins and the potential of troubled loans ticking up.

Federal Reserve Bank of New York President John Williams said the economy is headed in the right direction, and it will likely be appropriate to cut interest rates later this year

The Seattle bank's stock price fell in 2023 amid concerns over rising interest rates and its concentration of multifamily loans. The buyer is FirstSun Capital Bancorp, which raised $175 million as part of the deal.