A softer-than-expected August Jobs Report pushed equity prices and bond yields lower last week. While consensus estimated 77,000 new jobs, the actual number came in at just 22,000. These results provide further evidence that the U.S. employment picture is weakening. We’re seeing firms across sectors slow or even freeze hiring as macroeconomic uncertainty builds.

Weakening Jobs Data Has Fed On Track For Rate Cuts

This jobs data brings the Fed’s dual mandate—price stability and full employment—into sharp focus. With inflation still above target and employment softening, the central bank faces a difficult decision: cut rates now to support labor markets, or hold steady to avoid reaccelerating price growth. One complicating factor is the impact of new tariffs, which have increased input costs for wholesalers but have yet to be passed on to consumers. If these costs begin to flow downstream, renewed inflationary pressure could be inevitable.

All signs currently point to a 25-basis-point rate cut at this month’s Fed meeting. Nonetheless, markets remain on edge. Key upcoming data, including the PPI and CPI reports, could shift the calculus. If wholesalers start to pass along costs as inventory cycles out, consumer pricing could suffer just as rate relief is being considered.

What Does This Mean for Borrowers and Real Estate Professionals?

Short-term rates have already fallen by more than 50 basis points across the front end of the curve, providing meaningful relief for borrowers with floating-rate mortgages or upcoming loan resets. This drop also benefits those pursuing bridge or construction financing, as pricing on short-term debt tends to track closely with Treasury yields.

On the long end of the curve, the 10-Year Treasury has dipped into the low 4% range, which supports lower rates for both conforming and jumbo fixed-rate mortgages. Although we’re unlikely to revisit pre-COVID rate levels, the market is beginning to price 30-year fixed loans in the 5.50% range and ARM products between 4.75% and 5.00%. The current rate movement represents a significant psychological shift for buyers initially sidelined by high rates.

Brokers Are Back –Why Are They Playing a Critical Role Now?

Bank underwriting remains tight, and many institutions are allocating capital toward other, more profitable business lines. This has created a surge in demand for non-QM (non-qualified mortgage) loans—products that offer flexibility for self-employed borrowers, real estate investors, foreign nationals, and other non-traditional profiles.

Unlike agency loans, most non-QM products must be originated through a licensed mortgage broker. At Insignia Mortgage, this is where we shine. Our “Individualized Lending” approach pairs borrowers with the right lender from our deep network of credit unions, private banks, and institutional partners. Whether it’s no-tax-return jumbo loans, interest-only structures, or construction and bridge financing, we help navigate financial complexity and get deals funded.

As rates shift and the credit landscape evolves, we believe now is a moment of opportunity. If you’re one of the advisors, realtors, or developers working with borrowers who don’t fit inside the traditional lending box, let’s connect asap. The Insignia Mortgage team has over a decade of success with closing non-QM loans.