Morning Brief — Wednesday, April 8, 2026

Today's Headlines

Fed Policy

March FOMC Minutes Released Today: Fed Held at 3.50%–3.75% with Tariff Inflation as the Central Concern

The Federal Reserve published the minutes from its March 17–18 FOMC meeting this morning, confirming the committee voted to hold the federal funds rate at 3.50%–3.75% and providing deeper context for the decision. The minutes reveal that tariff-driven goods price inflation was a central theme, with multiple participants noting that core goods prices had risen at a pace well above what would be consistent with the Fed's 2% target — a trend they attributed directly to tariff pass-through into consumer pricing. The committee also flagged elevated uncertainty around Middle East energy developments as a material input to the economic outlook. Perhaps most telling: Powell's post-meeting language that inflation "isn't coming down as much as hoped" was echoed throughout the minutes, reinforcing the message that the Fed is not in a position to cut. The updated dot plot median now projects just one rate cut for all of 2026, down from earlier expectations of two to three.

Applications Data

MBA: Mortgage Apps Fall 0.8% for Week Ending April 3 as Refi Index Hits Lowest Point Since December

The Mortgage Bankers Association's weekly applications survey for the week ending April 3 showed total mortgage application volume declined 0.8%, driven almost entirely by a 3% drop in refinance activity. The refi index is now at its lowest level since December 2025, not surprising given that the 30-year rate spiked 0.65% through March before stabilizing. The one constructive data point: purchase applications rose 1%, a modest but meaningful signal that some buyers are still moving despite rate volatility. On a year-over-year basis, purchase apps remain 7% below the same week in 2025. For brokers, the message in this data is straightforward: the refi wave that briefly emerged in February and early March has been cut off, and the focus returns to purchase pipeline development and the Non-QM products that can unlock transactions conventional underwriting cannot close.

CPI Preview

March CPI Releases Friday at 8:30 a.m. ET: First Report to Capture Real Tariff-Driven Consumer Price Increases

This Friday's Consumer Price Index release for March 2026 is the most consequential inflation data point of the quarter, and possibly the year. Economists are forecasting headline CPI at 3.70% year-over-year and 0.93% month-over-month, reflecting the combined impact of sharply higher energy costs driven by the Middle East conflict and the initial pass-through of tariff-driven goods price increases in categories like electronics, apparel, and household products. Unlike February's report, which largely preceded the tariff escalation cycle, March CPI will be the first clean read on what tariffs are actually doing to consumer prices. If the print comes in above consensus, the bond market reaction could reprice the entire rate outlook for Q2 and beyond. If it comes in below, there is potential for meaningful Treasury yield relief heading into the following week. Nobody should be floating into Friday without a deliberate strategic reason.

Rate Stability

After a Brutal March, the First Week of April Has Seen Just 4bps of Rate Movement — A Calm Borrowers Can Use

Following the most volatile month in the mortgage market in over a year, April has opened with unusual rate stability. Data from Mortgage News Daily shows the average top-tier 30-year fixed rate moved just 0.04% across the first five business days of April, compared to a 0.65% surge through March 27. Today's 13-basis-point improvement on the 30-year rate adds to a picture of temporary equilibrium as markets wait for Friday's CPI. For borrowers currently in pipeline, this window matters. The 10-year Treasury yield pulled back to approximately 4.26% today after hitting 4.34% yesterday, reducing some of the rate pressure created by Tuesday's bond sell-off. This is the kind of intraday improvement that creates a same-day lock opportunity for transactions ready to close, particularly before Friday introduces a new variable into the pricing equation.

Non-QM Spotlight

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DSCR Loans When the Math Still Works: Qualifying Investment Properties Without a W-2 in Sight

With 30-year rates at 6.25% and DSCR-specific pricing in the 5.875%–7.375% range depending on LTV and property type, real estate investors can still find deals where the property's rental income clears the debt service coverage threshold. DSCR underwriting ignores the borrower's personal income entirely and focuses exclusively on whether the subject property generates enough monthly rent to cover the loan payment, typically at a 1.0x–1.25x coverage ratio. For investors who show little taxable income due to depreciation and expense deductions, DSCR is often the only conventional path to acquisition financing. Short-term rental portfolios on platforms like Airbnb are increasingly eligible under DSCR frameworks, with some lenders accepting market rent schedules based on AirDNA or comparable STR data rather than existing lease agreements.

Run a DSCR Cash Flow Scenario →

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P&L-Only Loans: Skipping Both Tax Returns and Bank Statements for Self-Employed Borrowers

For self-employed borrowers who want the simplest possible path to qualification, P&L-only programs eliminate the need for both tax returns and bank statement documentation. Income is established entirely through a CPA-prepared profit and loss statement, with available LTVs up to 85% on primary residences. This approach is particularly effective for borrowers whose business structures or expense deductions make tax return income look low but whose CPA-certified P&L reflects the actual financial reality of the business. It is a faster documentation path than 12- or 24-month bank statement programs and appeals to borrowers who run cash-intensive operations where monthly deposit patterns are inconsistent or difficult to explain. P&L-only programs typically require the statement to be prepared by a licensed CPA or tax professional, and most lenders require a year-to-date update if the statement is more than 90 days old.

Review P&L-Only Program Guidelines →

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Interest-Only Non-QM: Lowering Monthly Obligations for Investors When Cash Flow Is Tight

Interest-only Non-QM loans allow borrowers to pay only the interest portion of their loan for an initial period of 5, 7, or 10 years, significantly reducing the required monthly payment relative to a fully amortizing loan at the same rate. For real estate investors, this structure can be the difference between a DSCR ratio that qualifies and one that falls short, since the IO payment is materially lower than a fully amortizing equivalent. It also preserves investor liquidity during the initial hold period, which is particularly valuable in a high-rate environment where every dollar of operating cash flow counts. IO Non-QM products are also gaining traction with high-income primary residence borrowers who prefer capital-efficient mortgage structures, particularly those with significant investment portfolios where deploying freed-up cash elsewhere may produce better returns than principal paydown.

Model an Interest-Only Payment Comparison →

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1099-Only Income: The Qualification Path for Independent Contractors and Commission-Based Borrowers

The contractor and gig economy continues to expand, and with it a growing pool of borrowers who earn substantial income through 1099s but cannot document that income through conventional tax return underwriting due to business expense deductions. Non-QM 1099-only programs allow these borrowers to qualify using just their 1099 forms, typically looking at 12 or 24 months of 1099 income and applying an expense factor to arrive at qualifying income. This approach is especially relevant for commission-only sales professionals, freelancers, independent consultants, and gig platform workers whose gross earnings are well documented but whose Schedule C-adjusted net income dramatically understates their actual financial capacity. For brokers with referral pipelines in real estate, technology, healthcare contracting, or creative industries, 1099-only qualification consistently surfaces viable borrowers who would otherwise be turned away without a Non-QM option on the table.

Discuss a 1099 Income Scenario →

Nate's Take

Today's FOMC minutes didn't contain any surprises, but they did provide the market with clear documentation of the Fed's position: tariff-driven goods inflation is real, it's tracked in the data, and it's not going away on its own. When Powell says inflation isn't coming down as much as hoped, and the minutes echo that concern across multiple participants, the implication for the rate environment is simple. There is no policy catalyst on the horizon that would force rates meaningfully lower without a corresponding improvement in the underlying inflation data. That makes Friday's CPI release about as high-stakes as a single data point gets.

Here is the practical framework for this week: today's 13-basis-point improvement on the 30-year gives brokers a tactical window. If you have a borrower who is ready to close, the lock conversation is worth having this morning. Rate stability this week has been the exception, not the norm, and a CPI print at or above the 3.70% consensus forecast on Friday could drive another leg higher in Treasury yields by end of week. The borrowers who float into that print without a clear thesis for doing so are taking on asymmetric risk. Non-QM pipeline deserves the same attention: non-agency spreads have been less volatile than agency MBS this week, but correlation can tighten quickly when rate moves are driven by inflation data rather than by technical flows.