The riskier side of the mortgage industry is changing drastically. The Non-QM industry disappeared overnight last Monday. Rates have surged on low-down payment loans. Few lenders are still doing Jumbo loans or purchase-money 2^nd HELOC’s. FHA minimum credit scores are increasing.

The mortgage industry has been extremely resilient over the last few weeks though and continues to adapt and get loans closed despite the current environment, as evidenced by a shift to exterior-only appraisals, more flexible verifications of employment, and e-recording of deeds.

Inflation has fallen as the economy has slowed, which is good for rates short-term.

Congress passed the $2.1 Trillion CARES Act, an unprecedented stimulus relief package providing relief to both individuals and businesses, but not necessarily good for rates long-term.

The stimulus package gives mortgage holders the ability to pursue a forbearance, which is the temporarily suspension of a mortgage payment due to a borrower verbally attesting to an inability to make a payment (no written evidence required).

Please understand that a forbearance is a type of default and that anyone pursuing a new purchase or refinance mortgage can’t have a forbearance request in process. The borrower has to choose between pursuing the forbearance or the new mortgage.