In a week expected to mark the close of a divided race for the U.S. presidency, mortgage loan officers are standing by the motto of, “Let’s control what we can control.“
As they navigate the anxieties of homebuyers and market shifts, they told HousingWire they’re encouraging clients to move forward with their applications rather than waiting on campaign promises.
With the election nearly behind them, they are hopeful for less uncertainty ahead, especially after an uptick in mortgage rates that runs contradictory to the Federal Reserve‘s rate cut in September. Most expect that as the political dust settles, rates could stabilize or trend downward, regardless of who occupies the White House — Donald Trump or Kamala Harris.
“The mood amongst our loan officers is a cautious excitement to get the election behind us finally,” said Todd Bitter, chief sales officer at UMortgage, which has about 300 sponsored loan officers across 39 active branches. “Most seem to think that, regardless of the winner, business will return to normal since the general homebuying public seems on edge.”
Bitter said this election reminds him of Y2K, in reference to a computer programming shortcut that was expected to cause issues when the year changed from 1999 to 2000. Bitter said that, “Wednesday, we will all wake up with little difference in our lives. Of course, depending on your views, it matters who wins, but little will change overall. The divisiveness that politics have become has created something from nothing.”
The political toxicity, however, has added some volatility to mortgage rates. After the Fed slashed 50 basis points to its benchmark rate in September, the 30-year fixed mortgage rate went down to 6.25%, according to HousingWire’s Mortgage Rates Center. But as the race advanced, rates picked up, reaching 6.86% on Monday. (The Fed is meeting again this week and is widely expected to announce a cut of 25 bps.)
“We’ve seen an uptick in the 10-year Treasury yield that has been as low as 3.6%, and now we’re up to 4.25%. The speculation is that at least some of the drivers here are market participants thinking that the odds of a Trump administration, and particularly the odds of a red wave, have increased quite considerably, and that would potentially be putting upward pressure on rates,” Mike Fratantoni, senior vice president and chief economist for the Mortgage Bankers Association (MBA), said last week during a conference in Denver.
The explanation is that there would be larger deficits under a Trump administration based on estimates from the Committee for a Responsible Federal Budget, which compared Trump’s and Harris’s economic proposals. Per the MBA, the 30-year fixed rate is projected to decline from an average of 6.3% in 2024 to 5.9% in 2025.
“I do believe that we are in a downward trend for rates,” said Kevin Leibowitz, CEO of New York-based broker shop Grayton Mortgage. “I do believe in the invisible hand — either party can say what they want, put policies into place or remove regulations, and the market will do what the market will do.”
Leibowitz’s general advice to his clients is to “lock a mortgage rate and move on,” since “timing any financial market is difficult.”
All in all, mortgage professionals don’t think Trump or Harris have offered a “panacea” for the housing market’s main struggle — the lack of supply.
“My advice is business as usual,” Bitter said. “The $25,000 Kamala is offering will never get through Congress, so waiting is going to cost more in house appreciation.”
Shannon Hoff, a senior mortgage adviser at American Pacific Mortgage — a lender with 1,685 sponsored LOs and 426 active branches — said that polls show both candidates “neck and neck,” so it’s unclear whether the election results will be known on Tuesday or Wednesday.
“I know that many articles are saying that under Trump, rates will be higher, but businesses will be healthier. Under Harris, they say the opposite will happen. However, a big problem homeowners have is financial and economic noise,” Hoff said.
“There is a bunch of noise, so some people are deciding to do nothing. As an LO, it is my job to educate my clients so that paralysis is not the issue. Homeownership has many more benefits than renting. It is just finding the individual ‘why’ for each potential client.”
