Sellers slash prices at historic pace

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1. Rocket is making VantageScore 4.0 its default credit score for eligible loans

After four months of testing 1.4 million credit reports side by side, Rocket Mortgage is making VantageScore 4.0 its preferred scoring model for eligible direct-to-consumer loans in Q4 — covering Fannie, Freddie, and eligible VA loans.

Among borrowers who got a better result with VantageScore, the average savings was $1,600 at closing.

• Rocket Pro is taking a different approach, keeping both FICO and VantageScore available to brokers so they can compare outcomes and pick the better score for each borrower. FHA, jumbo, investment, and second-home loans stay on FICO for now.

• UWM, which keeps both scores available, says roughly 1 in 4 borrowers in its pipeline is getting a better result with VantageScore — a share it expected to reach 40% by end of September.

2. Homeowners are sitting on record equity – but not using it

Homeowners with a mortgage now have $17.9 trillion in home equity, according to a new report from Cotality. Of that total, $11.5 trillion is considered "tappable,” meaning owners could borrow against it while still keeping enough equity to satisfy lenders. Yet homeowners are leaving almost all of it untouched.

Here’s why, according to CNBC:

• The richest owners are the least likely to tap. "The borrowers with the most housing wealth are often the least likely to tap it," said Cotality principal economist Thom Malone, noting that they often have little reason to move.

• Low rates have locked owners in. Anyone who bought or refinanced before or during the early pandemic likely has a mortgage rate a third or less of today's. A second loan would come at a much higher rate, which most won't take on unless they have to.

• Untouched equity keeps growing. With home prices still rising modestly in most areas, average equity per mortgaged homeowner climbed $6,000 in a single quarter to $310,000, giving owners little incentive to cash out.

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3. More Nuggets

🏡 Newrez turns servicing data Into repeat business for brokers. (NewRez)

🔐 TransUnion locks in 99-cent VantageScore pricing through 2028. (TransUnion)

🆕 New appraisal rules could vary by lender under GSE exception. (NMP)

🏘️ Google home listings go national through HouseCanary deal. (HousingWire)

📊 As fraud costs hit $275M, NAR helps real estate agents spot red flags with new digital hub. (NAR)

4. Sellers slash prices at historic pace

20.8% of listings nationwide had a price cut in September. According to Realtor,com, that’s the highest share for any month since October 2022 and the first time this year that price cuts have exceeded 2025 levels.

Here are the other key takeaways from the report:

• More homes are for sale. Listings rose 5.4% to more than 1.16 million, the closest to pre-pandemic levels yet. Minneapolis, Seattle, and Buffalo each saw increases of 28% or more.

• The West leads in price cuts. About 22.8% of Western listings were reduced, the biggest increase of any region. Salt Lake City topped all major metros, with cuts on one in three listings.

• Asking prices are falling. The typical asking price dropped 1.4% to $419,250, marking 11 straight months of year-over-year declines.

• Most sellers are cutting prices, not delisting. The share of homes pulled from the market held steady at 5.6%. In Salt Lake City and Denver, though, sellers who don't need to sell are delisting and plan to try again in spring.

5. Mortgage rates surge once again

The average 30-year mortgage rate increased by a quarter of a percentage point from last week, according to data released yesterday by Freddie Mac.

This marks the sixth consecutive weekly rise, and the largest week-to-week increase since late September 2022 — when the average rate spiked from 6.29 percent to 6.7 percent.

For the week ending on Feb. 26, right before the U.S. and Israel launched the war with Iran, the average 30-year mortgage rate was 5.98 percent.

NAR's Lawrence Yun called 7% the "new normal" last month, adding rates can only come down "once oil prices retreat and with a credible plan to reduce the budget deficit."

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

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