Cloud-banking software company Blend Labs posted a $39.6 million operational loss for the second quarter of 2021, its first as a publicly traded company.

The firm, led by Nima Ghamsari, saw both a rise in revenue and a widening of operational losses in the quarter. Revenue ticked up to $32.1 million, up 46% over the $22 million the company posted in the prior year. Similarly, operational losses nearly doubled from roughly $20.8 million a year ago. The company has repeatedly said that it is focused on long-term value potentiation over short-term profitability.

“In the second quarter we continued to expand our customer base and grow within existing customers, closed a large acquisition that will accelerate the advancement of our platform, and executed a successful IPO with strong investor interest and support,” Ghamsari said in a statement.

Blend’s white-label technology is what powers mortgage applications on the websites of traditional banks such as Wells Fargo and U.S. Bank, as well as large credit unions and even some tech companies. It checks income, it verifies identities and has become a key consumer-facing processing tool for some of the largest mortgage lenders in the country.

Over the last two years, Blend has acquired its own mortgage insurance firm and title insurance firm. The latter deal, a $422 million investment in Title 365, closed in the second quarter. The company said it’s integrating Title365 into its system.

The startup claims it helped 291 clients process roughly $1.4 trillion in loan applications last year, and has compared its ultimate goal of processing like a mortgage as intuitive as someone selecting a movie curated for them by Netflix.

“I think every lender out there recognizes that to be competitive, successful in the market, they need to be able to have seamless digital experiences for consumers,” Blend President Tim Mayopoulos told HousingWire in late July. “That’s what people are looking for in every aspect of their life, whether it’s buying something on Amazon or ordering a movie on Netflix. People want to be able to interact with their bank or their credit union or their lender in exactly the same way.”

In its second quarter statement, Blend said total banking transaction volume climbed to over 520,000, an increase of 51% year over year. It also said it now has deals with 32 of the top 100 U.S. financial services firms by assets under management, and 28 of the top 100 nonbank mortgage lenders in the country. New clients include lender and servicer Mr. Cooper, retail lender KeyBank, credit card company Bilt Technologies and credit union BECU.

The company went public in July, selling 20 million shares of Class A stock at $18 apiece, raising $360 million.

Blend is projecting between $226 million and $232 million in revenue for 2021. Pro forma revenue, which includes the Title365 transaction, is expected to be in the range of $365 million and $371 million, the company said.

At the close of trading on Thursday, Blend’s stock was trading at $19.78 a share.

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With its wide variety of museums, theaters, parks, and professional sports teams, Chicago is arguably the cultural epicenter of the Midwest. From Millennium Park to the Magnificent Mile, Chicago has a signature urban vibe that’s entirely distinct from other major cities.

Though this lakeside metropolis is fondly referred to as the Windy City, real estate agent Michael Scanlon simply calls it “home.” Scanlon has been investing in the Chicagoland area for quite a while, and now he shares his firsthand financial successes with other real estate buyers as a top-performing local agent.

Investing in Chicago can be quite profitable, but it can also be complicated. The nuance of different neighborhoods requires a knowledgeable local agent to maximize investment potential. Scanlon shares his thoughts on Windy City real estate in his own words.

Real estate background

I have been a real estate agent since 2019, but I was an investor myself prior to that time. I have my MBA in finance, so I’ve invested heavily in real estate as well as a number of alternative investments.

In the last 12 months, I have personally done 87 transactions as an agent. I now run a team, and I hope to do 200+ transactions in the next 12 months with them.

I work with all types of clients, but my focus and specialty is investment properties, so I tend to search for investors as clients. In addition, I do a high volume of listings and have helped a number of family and friends.

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What makes the Chicago real estate market unique?

Chicago is one of the most affordable major cities. Downtown we can get cap rates of 4%-7%, and many of the suburbs can get into double-digit cap rates. We have all the amenities of a major city, along with a higher average income than most areas with these cap rates.

What kind of numbers can investors expect in Chicago?

Rent varies massively depending on the neighborhood in Chicago. A high-end neighborhood could get 3%-6% cash-on-cash return on a 20%-down investment. However, in some areas those numbers rise to 20% or more—though to be fair, those areas come with their own challenges. Many places in the suburbs we can still find 1% rent-to-price ratios.

How competitive is the market right now?

Chicago, much like other places, is highly competitive. Turnkey single-family homes in the suburbs are going for 10% above asking price or more. Many investment properties are getting offers over asking price within one or two days as well.

On the listing side, I am seeing seven to 15 offers on the best properties in the first two or three days. We are seeing a lot of competition in the market. However, deals can still be found with the right guidance.

What neighborhoods are you most excited about?

I personally like Bronzeville, Hyde Park, and South Shore here in Chicago. There are many areas that are on their way up, but these areas are still affordable.

One drive around shows all the institutional money pouring in. The University of Chicago is growing, and the Obama library should be going in soon. There’s an e-sports arena and a proposed casino coming to Bronzeville as well.

To complement the new construction, these areas also have beautiful older brick and greystone buildings that add a lot of character. This part of town is close to the lake and public transportation, and it has golf courses, parks, and many other desirable features.

What types of investment properties do you think investors should consider?

With leverage, the numbers are phenomenal on house hacks here in Chicago. Many other areas (Seattle, San Francisco, New York) I hear it is harder to house hack. Chicago is a tremendous house hacking market.

What kind of rental demand are you experiencing in Chicago currently?

Rental demand in the suburbs is strong. Downtown will always have some demand, but many people moved out of high rises during COVID-19, so that market has waned slightly.

More on local markets from BiggerPockets

Which real estate strategies are having the most success in Chicago?

House hacking is hot, both multi-family homes in the growing areas and condos (by the room) in desirable downtown neighborhoods. BRRRR deals are successful in some areas that may be seen as less desirable—the numbers work and there’s less competition. Buy and hold strategies can also work in a number of neighborhoods here.

What do residents do for work? Are there any industry changes expected?

As a major metropolitan center, Chicago is incredibly diverse, and we do not rely on specific industries. Some areas of Chicago have seen Amazon fulfillment centers boost their economy, but overall, Chicago is extremely well-rounded in terms of industry.

What is your post-closing referral network like?

We have a network of preferred vendors we can recommend, though every investor should do their own due diligence.

What do you love about Chicago personally?

Chicago has the best food, the most museums, and a tremendous summer culture. (As Kanye said, “summertime Chi!”) Any place in the city is no more than 30 minutes from a forest preserve and about an hour from farmland. Within the scope of Chicagoland, we have the best of two different worlds: urban and rural. It’s a great place to live and a great place to invest.

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Today, the U.S. Census Bureau reported that housing starts hit 1,534,000 for July, missing estimates. Permits, on the other hand, beat estimates, coming in at a seasonally adjusted rate of 1,635,000. Positive revisions to the previous data were made, but not by very much. This mixed bag of results reflects the typical variability in the data that occurs when not too much has been happening in housing except that monthly supply has been rising for the new home sales market. Homebuilders are navigating their housing stock well to make sure not to give up too much on the margin side of the business in the future.

The previous economic expansion from 2008 to 2019 had the weakest housing recovery ever following the bust. I have often said that both purchase applications and housing starts would be limited until we hit the period of favorable housing demographics from 2020 to 2024.

Specifically, I said that purchase applications would not get to 300 in the MBA index until 2020 to 2024. During this period, household formation will create the mortgage demand needed to push applications to that level, and purchase applications did get to this level right before COVID-19 hit in February of 2020.

When considering the future trend for purchase application data, it is best to exclude the COVID-19 makeup demand in the second half of 2020. This rule pretty much holds for all housing data. If you ignore that big move in the second half of 2020, you can see that we currently do not have a credit boom, but rather solid demand from replacement buyers.

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    We’re living through a very interesting time in the U.S. housing industry. The global pandemic hit our industry like a pair of defibrillator paddles, bringing mortgage industry CFOs to life and sending millions of dollars into new technology investment and implementation.

    The old debate over the primacy of best-of-breed tech stacks versus an all-in-one platform was resurrected and taken to new heights. With volumes at historic highs and escalating competition from new fintech lenders, choosing the wrong option could have major ramifications for a lender. These industry factors have brought this debate to the forefront of lenders’ minds.

    But how can we differentiate between a true end-to-end platform versus a tightly integrated collection of disparate tools? Actually, it’s never been easier. All we have to do is look at performance.

    Start at the beginning with the point of sale

    Over the past few years, we’ve been watching a boom in point-of-sale (POS) and consumer portal technology, where the consumer’s borrowing journey really begins. Development of this technology was slow initially compared to other markets, but COVID has accelerated it into high gear. Today, a great many lenders are focused on enhancing and improving the front end of the business.

    This is not a bad thing. The POS is an important part of the overall process of originating a loan, more so in a world where the vast majority of borrowers are interacting with lenders online. The POS is a fantastic tool for dealing with prospective borrowers and guiding them into the loan origination process. Once there, the consumer portal on the front end can be a powerful communication tool to keep the borrower engaged through underwriting and processing.

    But that work is futile if the lender ignores the back end of the process. The loan manufacturing or fulfillment part of the process is where the promises made to the borrower during the application process are paid off.

    Sure, consumers love it when they can complete an application for a new loan in just a few minutes. But when it then takes another 45 days — or longer — to close the loan, are you truly providing a better customer experience?

    When we look at some of the new POS technologies that have been connected to legacy origination systems, we see that uneven experience that mortgage borrowers just don’t like. It may be poor integrations or otherwise disjointed connections, but it always leads to problems with the overall process and experience.

    One glaring example of this is asking the borrower for the same information multiple times through the lending process — a key contributor to low net promoter scores.

    On the other hand, all-in-one solutions don’t have to share important borrower information with outside systems. Therefore they provide the lender with the opportunity to offer the borrower that full service and high level of customer satisfaction on both the front and back ends of the transaction.

    This is especially true of all-in-one solutions that offer dynamic tasking. A platform that serves as the lender’s single system of record with a contiguous back end can use dynamic tasking to track the exact data requirements throughout the process, making it possible for the lender to request the correct information only once.

    Fast and furious in the lending world

    Lenders are under constant pressure to move faster. When they don’t, consumers become unhappy. This is particularly true for the newest group of homebuyers.

    Millennials, in particular, have high service expectations. It can be very hard to satisfy these borrowers without a streamlined and automated process, with the ability to close very rapidly. Remember, these borrowers have grown in the age of robust technology, online banking, and the Amazon Effect. Instant delivery of data and products is expected.

    Lenders can leverage everything they need with the technology we have available to close loans in a very short time frame. Of course, you have to work with your third-party service providers such as Verification of Assets (VOA), Verification of Income (VOI), and the tools the GSEs provide and make sure that things like the property appraisal arrives in a timely manner.

    When you can process data in an event and data driven system instead of a form-based system, everything moves faster. A data-centric approach utilizing a single system of record is the way to accomplish this.

    Lending done right…end to end

    To meet the demands of today’s mortgage borrowers you have to rely on the best technologies available. Loan origination system developers, for the most part, have focused their efforts on loan processing through the post-closing process. They know this space quite well and no fintech firm has, as of yet, been able to displace traditional LOS providers in the mortgage space.

    But because so many lenders have been focused on the front end of the process for so many years, many product teams and developers have fallen behind when it comes to streamlining these back-end processes. The act of sending a loan through the system and on to post-close was becoming an overlooked part of the process. Despite this, achieving back-office efficiencies is a real opportunity for lenders right now.

    The POS boom gave lenders some new efficiencies on the front end, but poor integrations and the inherent problems associated with connecting disparate information systems did not extend those same benefits to the back office. As a result, borrower expectations still have not been met.

    A better solution will have a fully integrated POS built into the LOS, creating a single system for end-to-end loan origination. It’s far easier for an LOS developer to add these front-end tools than it is for a POS developer to launch a new LOS.

    Ultimately, the future belongs to lenders who have the tech stack to meet the changing demands of the borrowers they serve. More lenders are realizing that this means choosing an end-to-end, all-in-one mortgage lending origination solution. Fortunately, the technology exists and can meet this critical lender need.

    Michael Farris is vice president of strategic solutions at Origence.

    This column does not necessarily reflect the opinion of HousingWire’s editorial department and its owners.

    To contact the author of this story:
    Michael Farris at

    To contact the editor responsible for this story:
    Sarah Wheeler at

    The post Why mortgage lenders should be using a single platform appeared first on HousingWire.

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    For better or worse, trends in the mortgage industry tend to mirror corresponding trends in the overall real estate market. But there are definitely a few main things to looks out for — many of which are carrying over from a turbulent 2020 and early 2021 — when it comes to the upcoming landscape for the rest of 2021:

    • Lack of inventory
    • Fluctuating interest rates
    • Increased adoption of technology

    Inventory issues

    Emerging out of the pandemic, the first half of 2021 showed that there is a historically low housing inventory across multiple markets in the U.S. Like so many other production pipelines, the construction of new homes, along with shortages in building materials like concrete and lumber, caused a significant decrease in new homes for purchase.

    In addition, a vast majority of people spent more time at home in 2020 than ever before in modern history. As homes morphed into offices and schools over the last year, many people are looking to move, realizing they might want to start thinking about whether they need more space.

    The subsequent lack of inventory, coupled with the high demand, has caused buyers to compete for properties, offering incentives and prices way above the asking price. Most buyers end up making multiple offers, working with brokers over more extended periods due to increased competition.

    Typically, this dynamic tends to favor the seller because, thanks to the lower interest rates, buyers are willing to borrow more and pay less interest over the life of the loan. Low housing inventory and the general uncertainty in the economy all factor into the current market price for homes and interest rates.

    All about the rates

    The lack of inventory might have caused a lull in terms of new loan originations, but thanks to some incredibly low interest rates, which are projected to stay in the low 3’s throughout this year, that lull was primarily made up for by a considerable increase in refinancing loans until about mid-year. For homebuyers, the ability to get locked into a low interest rate proves to be a great opportunity. With competition and, by extension, housing prices being extraordinarily high, prospective homebuyers can counterbalance this by locking in a low rate.

    Push for tech

    When COVID forced the real estate industry to get digital, gasoline was thrown on the same trend within mortgage lending. Still, there remain processes within the mortgage industry that remain antiquated, relying heavily on the mantra that it’s “just the way it’s been done” for decades. In the end, what it comes down to is customer experience and the truth of the matter is that progressive technology platforms should improve that experience and overall outcome.

    With the myriad of the proptech and fintech apps out there, homebuyers can apply and qualify for a mortgage via mobile apps while they’re literally standing in the house they wish to buy. Like in so many other industries, the customer is driving the need for innovation.

    In turn, mortgage companies need to get with the times, implement technology and improve efficiency. In addition, on the real estate side, the days of having only the traditional open houses are gone. The virtual home touring technology that has served as a stop-gap is here to stay, and prospective homebuyers have come to expect virtual walkthroughs and realistic 3D renderings.

    On the mortgage side, recruiting has gone virtual as well, which has been and will continue to be another significant adjustment for the industry. So much of the mortgage industry is based on relationships, most of which are typically forged and maintained in person. For most of 2020, almost all of that moved online, which created its own kind of challenges for recruitment.

    Utilizing data from AI to understand key players in the industry based on their match to an organization, culture and leadership has allowed mortgage recruiters to use passive recruiting as a tactical growth tool. Companies that can build their recruiting pipelines into a software platform incorporating CRM functionalities will be the ones who continue to adjust successfully.

    The rest of this year, we will see a strong housing market as the economy continues to recover in the post-COVID-19 world. The real estate and mortgage industries are constantly evolving, as are those who work within those industries. We can do well to remember that “in the midst of every crisis lies great opportunity,” including the expansive opportunities in the real estate and mortgage realms.

    Eric Levin is EVP of Client Development at Model Match.

    This column does not necessarily reflect the opinion of HousingWire’s editorial department and its owners.

    To contact the author of this story:
    Eric Levin at

    To contact the editor responsible for this story:
    Sarah Wheeler at

    The post 3 mortgage industry trends that will define the rest of 2021 appeared first on HousingWire.

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    The recent changes to the Federal Housing Finance Agency (FHFA) leadership and regulatory environment will greatly affect the broker community, products and services. HousingWire recently sat down for a conversation with Flagstar Bank President of Mortgage Lee Smith and SVP of National Sales for TPO John Gibson to discuss how brokers can continue to maintain momentum even with these changes.

    HousingWire: There were recent changes to leadership in the Federal Housing Finance Agency (FHFA) that are going to impact the broker community. What were the changes and how is that going to impact the broker community?


    Lee Smith: With the appointment of Sandra Thompson as acting director of the FHFA in June, the agency is going to be more focused on affordability, risk management and liquidity. And that’s good news for consumers, brokers and the industry as a whole.  

    Thompson’s decision to eliminate the adverse market refinance fee, which added several basis points to the cost of every refinanced agency loan over $125,000, is pro-consumer, increases the competitiveness of GSE loans and should be positive for prospective refinance customers. 


    John Gibson: We’re hearing rumblings about more affordable housing options under the new leadership, and any expansion in offerings should be good for originators. The question now is about other caps, such as the sale of investment properties and GSE limits on purchases via the cash window, and whether we’ll see any movement there.

    HW: How can lenders maintain momentum with the Government Sponsored Enterprise (GSE) investor property cap?

    LS: Earlier this year the Federal Housing Finance Agency imposed a 7% cap on purchases of second-home and investment property mortgages from any one lender. This obviously caused many lenders to re-think their sales strategies around non-owner-occupied loans.

    We believe we have an advantage at Flagstar. As a bank, we not only have a balance sheet and are well-capitalized—which means we can put loans into our portfolio—but we also have a robust residential mortgage-backed securities program. We’re the perfect partner for brokers originating non-owner-occupied loans and looking for an aggregator to sell those loans to. In the second quarter, we were the third largest RMBS issuer in the country, with two of those securitizations being for non-owner-occupied loans. And we have more securitizations planned for the remainder of this year.

    HW: How does Flagstar Bank help brokers maintain their business even as the industry continues to evolve?

    JG: The industry is evolving and change is the norm. At Flagstar, we’re always looking at the products and services we provide our business partners to find ways to help them grow. Flagstar has been in the TPO business for almost 35 years. We’re one of the only federally regulated entities operating in the broker space. For us, it’s all about listening to our broker partners, making investments to give them ease of use, and counseling, educating and advising.

    From a secondary and capital markets perspective, we have some of the best minds and leaders in the industry at Flagstar. They bring value to our broker relationships that are unbeatable.  And as our merger with New York Community Bank unfolds, the ability to expand our product set and become more strategic and more innovative will only grow. Ultimately, it’s about more resources to support our brokers and deliver the best, most diverse products available.

    HW: What changes in the mortgage industry should brokers and lenders focus on the most right now and why?

    LS: There are a lot of changes happening in the mortgage industry right now, and all participants need to be flexible and nimble enough to react. 

    We’ve already discussed the changes at the FHFA, but the regulatory environment, in general, is likely to get tougher and technology is likely to continue to disrupt the industry as consumers become ever more comfortable using their mobile devices and other technologies to conduct business. Finally, Ginnie Mae has a proposal out for comment around eligibility requirements for single-family MBS issuers which could impact the landscape in Ginnie Mae markets.

    With respect to technology, we continue to invest in it to improve the customer experience for our brokers—and ultimately our borrowers—and to ensure that doing business with Flagstar is seamless and easy. Besides making direct investments in technology, we also partner with fintechs that we believe can help make us better, more efficient and improve the overall customer experience. We’re open-minded but focused on a great experience for our customers and partners.

    Finally, as I’ve mentioned, our balance sheet and diversified mortgage platform give us a lot of flexibility and options to pivot quickly and find opportunities, depending on how regulations and agency guidelines change.

    HW: You mentioned that Flagstar has really helped brokers excel in their business. Can you elaborate on what that means?

    JG: Something we do really well is help our brokers transition to correspondents—and we’ve been doing it for decades. You can start off as a broker with Flagstar, then move to a non-delegated correspondent, then a delegated correspondent, then into bulk loan delivery. We’ll support you every step of the way, with training, nurturing and the guidance of our experienced account executives.  And once you’re a correspondent, we can help you secure warehouse lines of credit. We understand the collateral, and we’re comfortable lending against it, which may be why today we’re the second-largest warehouse lender in the country. 

    Flagstar has supported the broker and correspondent communities for almost 35 years, and we remain committed to them through every change and every evolution of the business.

    Lenders and brokers need to take a serious look at who they’re partnered with and how it will enable them to continue growing through these industry changes. Flagstar Bank offers a wide range of solutions to help brokers excel.

    The post After FHFA leadership change, what’s next for brokers? appeared first on HousingWire.

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    Local markets spotlights 5 different areas across the country, showcasing what is uniquely happening in those housing markets. Local real estate agents, loan officers and appraisers share what characteristics are currently defining their housing markets.

    Louisville, Kentucky

    Louisville, Kentucky, USA Skyline

    “It’s wild,” said Elizabeth Monarch, who runs eXp’s Kentucky operation. “It blows my mind.” Monarch is talking about not just a Louisville housing market where prices increased more year-over-year than at any time in her 19 years as a real estate agent (the average Louisville sale is roughly $280,000 a home, Monarch said). She’s also referring to a new group of homebuyers. “I’m dealing with a lot of young people who have invested in cryptocurrency,” Monarch said. These clients have either made money in cryptocurrency and are spending it on a home, the agent explained, or see the rapidly escalating real estate market as another hot investment. “In the south, if you talk crypto, people will look at you like you have 10 heads,” Monarch said. Whatever the currency, Monarch believes “consumer confidence is very strong,” and “people feel very good about spending their money.”

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    Divvy Homes, the prop-tech startup that buys homes on behalf of renters and guides them to eventual ownership, announced Friday a new round of funding that nearly quadrupled its valuation to $2 billion.

    Co-led by Tiger Global Management and Caffeinated Capital, Divvy’s latest round raised $200 million in equity, Divvy CEO Adena Hefets told Bloomberg. Existing investors and others including Andreessen Horowitz, Singapore’s GIC, GGV Capital and Moore Specialty Credit participated in the round, which pre-empted a capital raise that could have featured new investors, she said.

    “We’re aiming to bring a legitimacy to alternative home financing options,” said Hefets.

    The Divvy Homes business model is aimed at boosting homeownership; Divvy purchases the home, then rents it back to the interested party for up to three years while they build their equity, credit and savings.

    For the new renters, approximately 25% of each subsequent monthly payment goes toward saving for a down payment, setting customers up to apply for a traditional mortgage when they are ready. A customer builds up to 10% of the value of the home over their three-year lease, but can buy the home at any time.

    Despite historically-low mortgage rates in the face of the COVID-19 pandemic, many banks began tightening underwriting requirements for approvals. This forced a myriad of potential homebuyers, eager to take advantage of the low rates, to reconsider buying or being outright denied by lenders.

    Hefets hopes the Divvy model will give people a roof over their heads in a time in history when home stability is crucial.

    Tiger Global Management in particular has been a heavy hitter when it comes to funding Divvy’s homeownership goals. The investment firm led Divvy’s last funding round just five months ago when the company snapped up $110 million in a Series C funding round.

    “Over the next 10 years, we believe Divvy Homes has the potential to help more than 100,000 families become financially responsible homeowners,” Scott Shleifer, a partner at Tiger Global, told Bloomberg. The startup is part of a broader wave of companies seeking to redefine the way Americans access home ownership, he said.

    According to Hefets, almost 25,000 real estate agents work with Divvy, over three times the number that did a year ago.

    And the idea is quickly gaining popularity. Landis Technologies, a company with a similar business model, hauled in $165 million in debt and equity financing less than a month ago. The proptech startup backed by celebrities Will Smith and Jay-Z aims to help renters become homeowners through a qualification technology that determines if renters have the potential to become homeowners in a 12- to 24-month period.

    The post Divvy Homes hits $2 billion valuation after latest funding round appeared first on HousingWire.

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    Mortgage credit availability increased marginally in July following a big downturn in June, according to a report released by the the Mortgage Bankers Association on Thursday.

    The MBA Mortgage Credit Availability Index overall rose by 0.3% to 119.1 in July (the index benchmarks to 100 in March 2012; a higher number portends more mortgage credit availability). The Conventional MCAI increased 0.8%, while the Government MCAI was unchanged.

    Mortgage credit availability largely jumped on the strength of jumbo mortgages. Of the component indices of the conventional MCAI, the jumbo MCAI increased by 3.8% and the conforming MCAI fell by 3.2%, the MBA reported.

    “Credit availability slightly increased in July, driven by an increase in jumbo loan programs,” said Joel Kan, the MBA’s associated vice president of economic and industry forecasting. “The overall gain was despite another month of pullbacks in high-LTV refinance programs due to GSE policy changes.”

    According to Kan, the elimination of more high-LTV refinance loans drove most of the 3% drop in the conforming index. Lenders adding new refinance loans that target qualified, lower-income Fannie and Freddie borrowers canceled the drop in conforming mortgage credit availability.

    June of 2021 saw a pullback in jumbo ARM offerings from investors, but they spiked in July. That led to an uptick in cash-out refis and investment homes, according to Kan.

    “Even as the economic recovery is underway, overall credit supply has remained close to its lowest levels since 2014,” Kan said. “Some borrowers are still in pandemic-related forbearance status, and servicers continue to work through possible resolutions for these borrowers.”

    Mortgage credit availability dipped 8.5% in June to 118.8. It was the lowest MCAI level since September 2020, and followed more than six months of increasing credit supply.

    Mortgage applications in the week ending Aug. 6 rose 2.8% after a strong jobs report in July. The U.S. Labor Department announced 943,000 new jobs, exceeding the forecast of 865,000. It was the highest month-to-month growth since August 2020

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    Washington D.C

    Senate Democrats this week unveiled a $3.5 trillion social infrastructure framework which would include down payment assistance, but little else to address challenges low-income and minority borrowers face in the housing market.

    The framework would set aside $332 billion for affordable housing. Senate Democrats hope to pass the legislation through an abbreviated budgetary process known as reconciliation, in tandem with the $1.2 trillion bipartisan infrastructure package, which passed the Senate on Tuesday. Biden has said he will only sign the bipartisan effort if the $3.5 trillion package, which includes much of his agenda, also passes.

    But so far, the proposal contains few ambitious new programs to tackle problems in the housing market. Besides down payment assistance, there’s no proposal to close the racial homeownership gap. Nothing in the proposal would salvage the country’s aging housing stock, or train a fleet of buildings tradespeople to retrofit inefficient homes. There’s no program make low-dollar mortgages make sense for those who finance them, and no funding to create a homeownership voucher.

    Most programs in the $3.5 trillion framework are geared toward renters, not homeowners. The biggest exception is down payment assistance, which President Joe Biden campaigned on, and which housing affordability proponents have argued would help more access homeownership.

    The Senate’s version is light on details, but a legislative proposal already exists in the House of Representatives. In July, California Congresswoman Maxine Waters, who chairs the House Financial Services Committee, proposed a $100 billion down payment assistance bill to provide up to $25,000 to first-time homebuyers.

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