LoanDepot sued, jobs report sparks hope

GM. This is Mortgage Nuggets, the daily newsletter that gives you all the best & latest mortgage news.

Everything you need to know in under 5 minutes.

  1. Strong job market, with 223,000 jobs added in December

The US labor market added 223,000 jobs in December, exceeding expectations, according to the US Department of Labor's Bureau of Labor Statistics.

By the numbers: The gain brought the total number of jobs added over the past two years to almost 11 million. The unemployment rate fell to 3.5% from 3.7% in November, which is the lowest rate since 1969 when calculated to extra decimal places.

Hourly wages increased by 9 cents, or 0.3%, to $32.82, and have risen by 4.6% over the past year. Gains were seen in leisure and hospitality, healthcare, construction, and social assistance.

 2. Loan depot sued

A group of former California employees at mortgage lender loanDepot have filed a lawsuit against the company, alleging violations of state labor laws, including failure to pay minimum and overtime wages and provide meal and rest periods.

The company, which is the seventh-largest mortgage lender in the US, declined to comment due to the pending litigation.

Between the lines: Former employees are demanding a jury trial and compensatory damages. The lawsuit comes after loanDepot laid off thousands of employees and suspended its 401K match program in an effort to cut costs in a shrinking mortgage market.

The company's CEO has said that the company remains committed to treating those impacted in a fair and compassionate way.

3. Purchase lock counts fall to 9-Year low as Fed hints at more rate hikes

The Federal Reserve's hints at further rate hikes for 2023 have reportedly caused a drop in purchase lock counts in December, marking the fewest counts in a single month since 2014.

By the numbers: According to Black Knight's originations market monitor report, mortgage origination activity dropped 19.4% from November to December, with purchase locks declining 20.5%.

Rate/term refinances dropped 11.2%, and cash-out refinances decreased by 14.1%, making up 16% of overall activity in December. The month also marked the fewest overall rate lock counts on record since January 2000.

Purchase mortgage lock counts in December were down 47% from the same month in 2021 and 33% compared to pre-pandemic levels in 2019. Overall rate lock counts were down 70% from last year's levels.

 4. Catch up quick

💼 Report: RMBS Credit May Bend, But Not Break (NMP)

📎 Redfin CEO predicts terrible consolidation (MarketWatch)

🏦 Bankers sue Rocket for allegedly failing to pay overtime wages (HousingWire)

📈 Freddie Mac: Mortgage Rates Inch Up (NMP)

5. Meme Corner

☀️ That's all for today. Great week ahead.

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