pmuolo@imfpubs.com  

In the wake of interest rates falling to historic lows the past week, originators found themselves happily swamped with new business while owners of mortgage servicing rights – a volatile asset for sure – were bracing for asset markdowns that might force weaker players to close their doors.

At least, that was the general mood of the industry as this weekend approached. The cause behind the rate mayhem: economic fears tied to the coronavirus, which originated in China before spreading to Europe and America.

Oddly enough though, last week’s rate dive was beginning to reverse somewhat, with loan officers reporting higher mortgage rates being offered every day this week.

“This is crazy,” quipped New Jersey loan broker Brian Benjamin of Two River Mortgage, blaming the general media for misreporting on the rate situation.

Benjamin fears that if the Federal Reserve doesn’t intervene by hiking its MBS acquisitions (which would cause rates to fall) the application tsunami will peter out. For more analysis on the situation, see the new edition of Inside Mortgage Finance.