How to Navigate 2026

Since mid September 2025 I started to notice a trend change in the Mortgage Market. 

I am talking about the Secondary Mortgage Market which is where Lenders sell their Mortgages in order to get the funds to fund new mortgages.

The Investors that power the Mortgage Business, the big companies that buy enormous quantities of Residential Mortgages, that you never see or hear about, have sophisticated professional tools that allow them to forecast the future many months in advance.

They work in the future, not in today's environment. This is why, for example, rates come down months before the Federal Reserve announces a rate cut and why, perplexingly for most people, the day the cut is officially announced, rates may go UP!

The reason is, by the time the decision to cut Rates is officially implemented, these Investors are already working in what is going to happen in the future.

Don't wait until the Fed implements a rate cut because the market already prices itself in anticipation. 

I am observing that the economy is becoming more challenging for our business owners clients and cash is tight. I am noticing that the Big Investors that power the Mortgage Market are becoming more strict.

This means they are focusing more and more on compliance and document verification.  They are becoming "anal" about following the guidelines they impose on the Lenders they work with.

At the Lender level, this has introduced more stress and their response has been to enforce the guidelines to a point where they are becoming nonsensical, where they are starting to loose well qualified loans to be "safe". 

At the Broker Level, this has burdened us more since we now need to deliver perfect paperwork, need to fight to enforce that the lender complies with its own guidelines and cut through the Mortgage Banker's fear to get loans approved and Funded.

As an example of this changing environment, historically, after a loan received Clear to Close (CTC) status, the Funding part used to be mechanical. Something the Title/Escrow company did in the background and you hardly heard about it - it took from one to three days from CTC to Funding.

Today, I have observed that every stage of the Funding Process is being delayed or stopped:

• Funding Conditions not Met

• Funders Demanding New Items

• E-Mails Getting Lost

• Personnel not Checking their Work

• Notaries not understanding Legal Language

• Processors not Monitoring the Process

Every single point of failure in the Funding Process has occurred. 

People commit these mistakes when they are under heavy pressure and they are worried.

Another example, a couple of days ago we funded a loan that was what I would describe as the perfect loan. High Net Worth Borrower, impeccable track record, ample amount of funds, beautiful recently renovated high end property, sizeable loan amount, etc... it checked all the boxes. 

However the personnel at the Mortgage Bank got lost in the minutia of the paperwork and where there was any room for interpretation, they chose the side against the borrower - out of fear, since their delinquencies have started to climb.

I had no other recourse but talk to the Founder of the Bank and he, within a couple of hours, solved the problem and the loan finally funded.

This is not an isolated behaviour, there is turmoil on the mortgage market. Even though rates are low, it is becoming harder to get a mortgage through.

The solution? we are making our loan packaging even more fail-proof and comprehensive. This requires more work from us and from you too since we need to collect more paperwork at the beginning of the loan and be even more proactive in anticipating underwriting issues.

We have created a new process that now checks every detail from Clear to Close to Funding, to ensure that we are able to catch errors before they become an issue.

During these past couple of months we have had to create a comprehensive new set of Policies to address this new mortgage environment that now we find ourselves in.

2026 is presenting itself as an opportunity from the standpoint of low rates, but challenging since loans have become harder to put through.

2026 is also a year where Rates are expected to wildly fluctuate. We anticipate movements of 1% or more up and down - be prepared for a "rate roller coaster" but don't worry too much, there is an ocean of money coming from Europe, seeking safety in the USA. Some of this Ocean of money is going to land in the Mortgage Market, creating a force that pushes rates down.  

Presently, overall, on a 30 years fixed, you can still get something under 6% for a Primary Residence and according to our model, the rate floor sits at around 5.00% while the ceiling has a resistance at 7.5%. 

The message of this newsletter is: please be patient when working with us specially if we ask you for more documentation at the beginning of the loan. 

We get loans done and funded! our funding rate is over 98% we don't take a loan that we don't believe will fund.

Let's work for a prosperous 2026!