CFPB sues Rocket, alleging illegal kickback scheme

🍾 Welcome back and happy new year! We hope 2025 has started well for you. Today’s newsletter is 689 words, a 2.5-minute read.

1. 30-year mortgage rate hits 6-month high

According to Freddie Mac, mortgage rates rose last week to their highest level since July. The benchmark 30-year fixed-rate loan increased to 6.91% from 6.85% the previous week. A year ago, the rate was at 6.62%.

The increase in the cost of home loans reflects a rise in bond yields, which lenders use as a guide to price mortgages.

The average rate on a 15-year fixed-rate mortgage, a popular choice for homeowners seeking to refinance, climbed to 6.13%, up from 6%. This is also the highest level since July. A year ago, the rate stood at 5.89%.

2. Mortgage applications dropped over the holidays as rates rose

According to the Mortgage Bankers Association (MBA), mortgage applications fell 21.9% in the final 2024 survey for the week ending Dec. 27.

Refinance applications dropped 36%, while purchase loan applications fell 13%. Year-over-year, refinance demand rose 10%, but purchase demand declined 10%.

✅ Get Accurate Lead Readiness Scores: AI: Propensity Modeling

Still waiting for the perfect moment to reach out to your contacts? If only there was a tool that can:

1. Analyze over 5,000+ consumer behavior data points using AI

2. Update, organize, and prioritize your lead database with “Readiness to Transact Scores”

3. Surface the leads in your CRM with the highest potential to convert

Good news, we have Aidium Intelligence's AI: Propensity Modeling! Combining AI, consumer behavior data points, and your CRM data, you get a 360-degree understanding of your contacts' readiness to transact so you can get your foot in the door sooner.

3. More Nuggets

🏘️ Is living on top of a Costco the answer to affordable-housing crisis? (WSJ)

⬆️ Jobless claims keep mortgage rates elevated. (HousingWire)

✍️ HUD seeks public comment on solutions to soaring insurance premiums. (HUD)

💸 SouthState wraps up $2bn acquisition of Independent Bank. (FutureBanking)

4. CFPB sues Rocket, alleging illegal kickback scheme

The Consumer Financial Protection Bureau (CFPB) has sued Rocket Homes, accusing the real-estate company of incentivizing brokers and agents to direct home buyers to its parent company’s mortgage arm, Rocket Mortgage.

The CFPB also sued Jason Mitchell and his firm, JMG Holding Partners LLC, for their role in an alleged kickback scheme. Rocket Homes reportedly pressured brokers not to share alternative products, like down-payment assistance programs, with clients.

The company offered incentives for referrals to Rocket Mortgage and its affiliate, Amrock, which provides title and closing services. The Mitchell Group further incentivized agents with gift cards for the most referrals to these companies. Rocket denied the CFPB’s allegations.

5. Stocks soar as Fannie and Freddie eye release from conservatorship

The agencies overseeing Fannie Mae and Freddie Mac have outlined a plan to release the mortgage giants from government control, sending their stock prices to a five-year high.

The new guidelines, released Thursday, restore the U.S. Treasury’s authority to approve any release plan, ensuring an "orderly" process. The Treasury and FHFA said this framework will help facilitate the exit from conservatorship.

The Treasury also committed to detailing plans for ending conservatorship, seeking public input, and consulting with the Financial Stability Oversight Council and the president. The process could take years, with analysts expecting a release around 2026-2027.

☀️ You’re all caught up. See you on Wednesday!

🚀 Wanna help our newsletter grow? Forward it to a friend or colleague.

Would you like to receive a ready-to-send weekly marketing email for your realtors and/or clients? Start your 30-day free trial here.

Was this email forwarded to you? Subscribe here.

Interested in advertising to 40k+ loan officers? Get in touch.