Fed cuts its key interest rate by a quarter-point

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1. Fed cuts rates again

The Federal Reserve cut its key interest rate Thursday by a quarter-point in response to the steady decline in the once-high inflation that had angered Americans.

The rate cut follows a larger half-point reduction in September, and it reflects the Fed’s renewed focus on supporting the job market as well as fighting inflation, which now barely exceeds the central bank’s 2% target.

Thursday’s Fed rate cut reduced its benchmark rate to about 4.6%, down from a four-decade high of 5.3%. The Fed had kept its rate that high for more than a year to fight the worst inflation streak in four decades.

2. Howard Lorber admitted to relations with brokers in company probe

Two weeks before Howard Lorber retired as chairman and chief executive officer of Douglas Elliman Inc., he said at an internal inquiry that he had intimate relationships with two of the company’s brokers, according to a report by the New York Post.

The revelation came during a five-hour videoconference call on Oct. 8 where Lorber was questioned about his personal life and allegations of sexual harassment at the firm that he ran for 21 years.

Douglas Elliman’s workplace culture was thrust into the spotlight over the summer after two of its former star brokers — brothers Oren and Tal Alexander — were each sued for their alleged roles in sexual assaults.

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3. More Nuggets

📈 Zillow reports 80% year-over-year increase in purchase loan origination. (Zillow)

🏘️ Higher mortgage rates predicted after Trump win. (Axios)

📊 Charted: Three-year change in median annual home insurance premiums by county. (ResiClub)

🗞️ Trump’s presidency signals new regulatory era for mortgages. (HousingWire)

Ad: Instantly find and interpret underwriting guidelines using AI. (Guideline Buddy)

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4. UWM profits drop sharply in third quarter

United Wholesale Mortgage reported another quarter of profits with net income of $31.9 million for the third quarter of 2024, which includes a $446.1 million decline in the fair value of mortgage servicing rights.

• This is a significant decline from the $301 million in net income reported in the third quarter of 2023 and the $76.3 million reported in the second quarter of this year.

The continued profitability comes as UWM reported an increase in loan originations, at $39.5 billion in the third quarter of 2024. That's an increase from $33.6 billion in quarter two and $29.7 billion in the same quarter last year.

5. FICO raises score price to $4.95

Fair Isaac Corp. confirmed Wednesday that it is indeed raising its prices for mortgage credit scores going into the new year.

Jim Wehmann, executive vice president of scores at FICO, wrote in a company blog that FICO's wholesale royalty will go up from $3.50 to $4.95 per score for mortgage originations.

The mortgage industry is now bracing for additional hikes from the credit reporting bureaus and other companies downstream of FICO.

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

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