Kill the Stack Weekly: The Perfect Storm Edition
I spent an hour last Tuesday watching mortgage Twitter try to process four pieces of bad news at the same time. Tariff escalation. Iran is closing the Strait of Hormuz. Another week of rising rates. And a quiet little data point from the Community Home Lenders Association showing that FICO now charges $30 for a tri-merge credit report that cost $1.80 four years ago.
Nobody connected them. Everyone treated each headline as its own isolated problem. But they’re not isolated. They’re all hitting the same system — and that system was already fragile.
Here’s what I saw this week, and what I think it actually means.
United States
Rates are climbing, and the macro picture is ugly
The 30-year fixed hit 6.46% as of April 2 (Freddie Mac), marking the fifth straight week of increases. Mortgage News Daily had it at 6.55% by Monday. Citi pushed its expected Fed cuts to September at the earliest. Some banking giants have stopped forecasting any 2026 cut at all. 97% of interest rate traders expect the Fed to hold at the April 28-29 meeting.
Meanwhile, Mortgage Professional America is asking if this is “the perfect storm for housing” — tariff-driven inflation, a Middle East conflict rattling bond markets, and a collapsed refi market all converging at once.
My take: The macro is what it is. You can’t control rates, tariffs, or wars. What you can control is how much chaos your operation can absorb before it breaks. The lenders who built their stack around manual handoffs and status meetings are about to find out how expensive that architecture is when volume shifts and every basis point matters. The ones who built for flow — automated validation, parallel processing, event-driven data movement — will bend without breaking. The storm doesn’t create the weakness. It reveals it.
FICO is taxing every deal and nobody can opt out
The Community Home Lenders Association dropped a number that should make every lender angry: FICO’s base price for a tri-merge credit report jumped from $1.80 in late 2022 to $30 in 2026. That’s a 1,500% increase in four years. CHLA members report an average cost of $540 per file. HousingWire estimates the industry-wide impact at over $500 million.
My take: This is what happens when a single vendor becomes load-bearing infrastructure. FICO isn’t innovating. They’re extracting. And the industry can’t opt out because credit scores are hardwired into every guideline, every AUS, every pricing engine. This is the purest example of the Kill the Stack thesis: invisible costs embedded so deep in the plumbing that nobody questions them. They just get passed through — to the lender, to the borrower, to the margin. If you want to understand why origination costs won’t come down, start here.
Serious delinquencies are climbing quietly
ICE’s April Mortgage Monitor showed overall delinquency rising to 3.72% in February, with serious delinquencies up 25% in four months. FHA loans are leading the distress. This is happening even as affordability has improved year-over-year.
My take: This one’s worth watching. When delinquencies rise during an improving affordability window, it usually means the problem is structural, not cyclical. Borrowers who were stretched thin during the rate spike are now rolling into distress even as conditions stabilize. For lenders and servicers, this is another argument for real-time portfolio monitoring instead of backward-looking reports. If your servicing stack can’t surface early warning signals before a loan goes 90 days past due, you’re managing with a rearview mirror.
The CFPB is gone in all but name
The numbers are stark: CFPB enforcement dropped to 12 publicly announced actions in 2025 — the fewest in a decade. The agency is reportedly cutting examinations from roughly 600 annually to about 70, conducting them virtually, and narrowing their scope. Disparate-impact enforcement has been formally deprioritized. The enforcement vacuum is shifting to state attorneys general and state-level regulators.
My take: Whether you think this is good policy or bad policy, the practical effect is the same: compliance is about to get more fragmented, not less. Instead of one federal framework, lenders operating across state lines will be navigating a patchwork of state-level enforcement priorities. That’s a stack problem. Lenders with flexible, configurable compliance infrastructure will adapt. The ones running compliance on spreadsheets and tribal knowledge will get caught.
MBA: productivity is falling and the tools aren’t helping
Marina Walsh from the MBA reported that origination pull-through has declined over the past four years and productivity remains below 2018 levels — despite billions in technology investment across the industry. Origination costs remain elevated even as volume is forecast to hit $2.2 trillion.
My take: This is the data point that should keep every mortgage executive up at night. The industry is spending more on technology and getting less productive. That’s not a technology problem. That’s an architecture problem. More tools don’t help if the space between the tools keeps expanding. Every new point solution adds integration cost, maintenance overhead, and another seam where data can break. The MBA data is the Kill the Stack thesis in a chart: tool accumulation without system design produces declining returns. The answer isn’t better tools. It’s fewer seams.
Canada
The renewal wall is here
CMHC reports that 1.4 million Canadian mortgages — 23% of all outstanding mortgages — will renew this year. Many borrowers locked in at 2-2.5% during the pandemic and are now facing rates north of 4%. Payment increases of 15-20% are common. A homeowner with a $500,000 mortgage renewing from 2.5% to 4.0% sees roughly $320 more per month. For a $400,000 mortgage jumping from 2.04% to 4.5%, that’s nearly $600 per month — $7,200 a year.
Fixed mortgage rates are climbing in April as Government of Canada bond yields rise above 3%, driven by the same geopolitical tensions rattling US markets. The Bank of Canada held its overnight rate at 2.25% in March for the third consecutive announcement, with the next decision on April 29.
My take: The Canadian renewal wall has been talked about for two years. Now it’s actually here. The lenders who’ll handle this well are the ones with retention infrastructure — automated renewal workflows, proactive borrower outreach, real-time rate comparison engines. The ones who treat renewals as a manual, file-by-file process are going to lose borrowers to brokers and digital-first competitors who make switching painless. The renewal wall isn’t just a risk. It’s a distribution event. The question is whether your stack is set up to capture it.
OSFI is tightening the screws on rental properties
OSFI’s revised Capital Adequacy Requirements are now in effect, tightening how rental income qualifies across multiple properties and raising capital requirements for lenders on income-producing residential real estate. The key change: income used to qualify for one mortgage can’t be double-counted for another. Banks can still use the “50% borrower-income” test to classify a mortgage as income-producing, but OSFI is watching.
Bigger picture: OSFI has signaled its next project — a draft Credit Risk Management guideline that will consolidate and modernize existing guidance, including Guideline B-20, into a single framework covering residential mortgages, commercial real estate, and corporate lending.
My take: OSFI consolidating B-20 and other guidance into one CRM framework is the regulatory equivalent of killing the stack. Instead of a patchwork of separate guidelines that were never designed to work together, they’re building a unified system. Lenders should be doing the same thing with their own infrastructure. The irony: the regulator is modernizing faster than most of the companies it regulates.
Both Sides of the Border
AI is proliferating — but watch where it lands
ICE Experience 2026 in Las Vegas was a showcase for new AI tools. Highlights: an automated conditioning engine (developed with Zillow, All Western Mortgage, and Neighborhood Loans) that eliminates manual underwriter condition tasks. Palantir and Moder announced an AI-powered mortgage ops platform with Freedom Mortgage as the first pilot. Dark Matter Technologies launched “Ask Aiva,” a conversational AI assistant embedded directly in the Empower LOS. And ICE Mortgage Technology previewed AI-backed voice and chat servicing agents.
Scotsman Guide’s latest survey confirms the trend: lenders are surging toward AI and automation, with 73% citing operational efficiency as their primary objective.
My take: The AI tooling is real and accelerating. But I keep coming back to the same question: where is it landing? Most of what I saw is AI bolted onto the existing stack — smarter features inside the same fragmented architecture. That’s useful. It’s not transformational. The real unlock isn’t an AI assistant that queries your LOS. It’s an architecture where the LOS doesn’t create the bottleneck in the first place. AI on top of a broken stack makes the broken parts faster. AI that replaces the stack changes the game.
The bottom line
This was a week where everything hit at once — macro, regulatory, structural, technological. On both sides of the border, the pattern underneath is the same: the lenders whose infrastructure was built for resilience are absorbing the shocks. The ones whose infrastructure was built by accumulation are feeling every one of them.
The storm doesn’t care about your vendor list. It cares about your architecture.
See you next Monday.
Chris Grimes is the founder of FundMore, an AI-native loan origination platform. FundMore builds agentic mortgage and lending infrastructure for institutional clients across Canada and the US.