r/VeteranHomeLoans

A lot of veterans don’t realize how powerful VA seller concessions can be on a purchase.

There’s a TON of misinformation out there about the VA “4% rule,” so I wanted to break it down in simple terms for fellow vets looking to buy a home.

The seller can pay:
 ALL standard closing costs
 Discount points to buy down your interest rate
 PLUS up to 4% in additional VA seller concessions

That 4% concession can be HUGE if structured correctly.

Here are some of the BEST ways veterans can use VA seller concessions on a purchase:

 1. Buy Down the Interest Rate
This is one of the smartest ways to use concessions in today’s market.

Instead of bringing money to closing, negotiate seller credits to permanently lower your interest rate. Even a small rate reduction can save hundreds per month and tens of thousands over the life of the loan.

 2. Cover ALL Closing Costs
Depending on the deal, the seller can often pay:

• Loan costs
• Title fees
• Escrow fees
• Taxes
• Insurance
• VA funding fee (if applicable)
• Prepaids

This can dramatically reduce out-of-pocket cash needed to buy.

 3. Pay Off Collections or Debt to Help You Qualify
VA allows certain debts or collections to be paid through seller concessions if needed for loan approval.

This can help veterans qualify for more house or lower debt-to-income ratios.

 4. Pay Off Judgments
If a judgment is preventing approval, concessions may be used to clear it before closing.

 5. Temporary Rate Buydowns (2-1 Buydowns)
Seller concessions can fund temporary buydowns to lower your payment during the first years of the mortgage.

Example:
Year 1 = rate reduced by 2%
Year 2 = rate reduced by 1%
Year 3 = full note rate

This can help veterans ease into higher payments.

 6. Cover VA Funding Fee
If you’re not exempt from the VA funding fee, concessions can sometimes help offset this cost as well.

 7. Prepay Taxes & Insurance
Reducing upfront cash needed at closing can make homeownership more achievable for many veterans.

IMPORTANT:
The 4% VA concession cap DOES NOT include normal closing costs. This is where many people get confused.

So in many cases, a seller can:

 Pay all normal closing costs
 Buy down the rate
 AND still contribute additional concessions up to 4%

VA loans are one of the strongest loan products available when structured correctly.

If you’re a veteran buying in today’s market, don’t leave these benefits on the table.

Home affordability is at generational lows, and the numbers behind it tell you everything you need to know about why this matters right now.

Baby Boomers hold $83.3 trillion of the $163.1 trillion in total U.S. household wealth, Millennials, who represent about the same share of the population, hold just $18 trillion, roughly one fifth of what Boomers have accumulated. Meanwhile, 2025 saw a 21% drop in the share of first time homebuyers, and the age of those buyers reached a record high of 40 years.

That gap between what one generation has built and what the next one can access is exactly why this conversation is happening more and more in my office.

Here is the thing most people get backwards. A lot of families think about wealth transfer as an inheritance, something that passes at death. But if your kid is 32 years old and struggling to scrape together a down payment while home prices are where they are today, waiting does not help them. Getting them into a home now, at today's prices, with a fixed payment locked in, is one of the most powerful financial moves a parent can make. That asset appreciates. The mortgage gets paid down. Equity builds for the next generation too. A gift that jumpstarts ownership compounds in a way that a check written decades from now simply cannot.

I have been doing this for a long time and gift situations are way up right now. Seen a ton of confusion in this sub about how it actually works, so let me break it down clearly.

There are two ways a parent can help a child buy a home. A cash gift and a gift of equity. Both are legitimate, both are allowed by lenders, and both can be structured to get your kid into a home with little to nothing out of pocket. Here is how each one works.

Cash Gift

You wire the money, the lender documents it with a gift letter. The letter needs to confirm the relationship, the amount, the property address, and that no repayment is expected. Then the lender traces where the money came from.

No seasoning required. But the paper trail is everything. The lender needs to see the funds sitting in the parent's account, and then see that money move. There are two ways to handle this. The first is a transfer from the parent's account into the kid's account, and then the kid brings those funds to closing. The second, and honestly the cleaner move in a lot of cases, is to keep the money in the parent's account entirely, source it there, and wire it directly to title, escrow, or the closing attorney. Fewer transfers means fewer questions and a cleaner paper trail. Either path works, but the lender has to be able to document the full journey from the parent's bank account to the closing table.

On a conventional conforming loan, 100% of the down payment can be a gift. There is no minimum that the borrower has to contribute themselves. That skin in the game requirement is a jumbo loan thing, not a conforming loan thing. FHA & VA is the same. 100% of the down payment can be gifted.

Gift of Equity

This is the one most people do not know about and it is honestly the more powerful move when the parent owns the home the kid is buying.

A gift of equity is when you sell your home to your child below market value. The gap between market value and the sale price is the gift, and it counts as their down payment.

Here is a real example. Home is worth $400,000. You sell it to your kid for $400,000 but gift them $80,000 in equity, which covers the full 20% down payment. You also pay $10,000 in closing costs as a seller concession. Your kid's loan is $320,000, no PMI, and they bring close to nothing to closing.

Why does 20% matter so much? Because hitting 20% down on a conventional loan eliminates private mortgage insurance entirely. PMI can run $100 to $300 per month or more depending on the loan size. Getting rid of it permanently is a big deal.

If you are going FHA, try to structure at least 10% down in the gift. FHA mortgage insurance works differently than conventional PMI. If you put down less than 10%, that insurance stays on the loan forever. Put down 10% or more and it falls off after 11 years. That one decision can save tens of thousands of dollars over the life of the loan.

Will You Owe Gift Tax?

Almost certainly not. The annual gift exclusion is around $18,000 to $19,000 per person per year. Two parents gifting to one child can double that without any filing requirement at all. For anything above that you file a Form 709, but that amount just counts against your lifetime exemption, which is currently around $13 to $14 million per person. You would have to give away more than $13 million over your entire lifetime before you owe a single dollar in gift tax. For nearly every family reading this that number is essentially irrelevant.

If you are already approaching the lifetime exemption, please do not take mortgage advice from Reddit. Get a tax attorney.

Bottom Line

An estimated $68 to $84 trillion is set to leave the hands of Baby Boomers and find ownership with their children and grandchildren over the next two decades. A lot of that transfer is going to happen at death. But for families where the kids are trying to buy a home right now, waiting is not a strategy. Getting them into real estate today, with equity working in their favor from day one, is a better use of that wealth than leaving it on the sideline.

A cash gift works great when your kid is buying from a third party seller and needs help with the down payment. A gift of equity is the more powerful tool when you own the home they are buying. Either way, get your mortgage team involved early. The structure of how funds move matters just as much as the amount, and getting that wrong can delay or derail a closing.

Yesterday, someone dumped $20B in Treasury futures in under an hour, a huge block trade day.

Yesterday I said there was no clear reason why the bond market sold off. Now we know.

Turns out it wasn't the whole market, it was one (maybe two) massive institutions executing a coordinated dump in near-silence. Someone quietly put through around 10 block trades totaling over $20 billion in Treasury futures, roughly 136,500 ten-year contracts and 83,000 five-year contracts, all within about an hour. Block trades are privately negotiated between big institutions and only reported after the fact, which is why there was no visible catalyst at the time. The move was happening in the background.

The 30-year yield briefly hit 5.20%, the highest since 2007. The 10-year touched 4.69%. Some are calling it the return of the "bond vigilantes", big money punishing the U.S. for its fiscal trajectory by selling Treasuries and forcing yields higher.

The silver lining: the rest of the market didn't follow. Other participants had every chance to pile on and mostly held their ground, which means this isn't (yet) a broad-based panic, just one very large, very deliberate bet that yields are heading higher.

Still no idea who. Best guesses are Japan or China quietly reducing U.S. exposure, or a big macro hedge fund making a directional bet. 60% of fund managers surveyed by BofA think the 30-year hits 6% this year, so there's no shortage of people with a bearish view.

Instrument	Price	Daily Change
UMBS 5.0	96.96	+0.16
10yr Treasury	4.634%	-0.033%

As of 8:09 AM EDT

Lock or Float?

With yields still elevated and one or two whales potentially not done selling, floating is a risky play right now. The 10-year at 4.634% is off yesterday's highs but still well above recent comfort zones. MBS prices are up slightly this morning, which means lenders may reprice for the better, but that improvement could evaporate fast if the bond selling resumes. If you're closing within 15 days, lock now. If you have 30+ days, you could cautiously float and watch whether this morning's relief holds through the week, but set a trigger to lock if the 10-year breaks back above 4.70%.

Curious what your rate should actually be? Post your scenario in the Ultra Thread. Verified brokers run live quotes using your credit, LTV, loan type, and occupancy. No personal information, no calls, no sales pitch. Find out if you are getting a fair deal or leaving money on the closing table.  r/MortgageBrokerRates Ultra Thread

Curious if anyone here has used their VA home rights recently and if they were able to get up to 4% concessions and any additional concessions IE closing cost partially or all covered.

Every situation is different but curious to hear what your purchase price was vs asking price. What did you end up overall negotiating.

A example I’m thinking of since it’s a buyers market is offering full asking price on a home . Hope it appraises and ask for concessions towards closing cost if not all and up to the VA 4% entitlement towards points, taxes and insurance.

One Year Chart for the 10-Year Treasury

If you looked at the 10-year Treasury yield this morning and felt a sense of déjà vu, you are not imagining it.

As of today, the 10-year is sitting at 4.592%, almost exactly where it was one year ago, nearly to the day. That level acted as a ceiling back then before yields spent the better part of the following months grinding lower, eventually touching the high 3s by late fall and into December.

Here we are again.

What does that mean for mortgage rates? Elevated Treasury yields put upward pressure on the cost of borrowing across the board. The 10-year is the single most important benchmark I watch every morning, because mortgage rates do not move in a vacuum, they move with it. When the 10-year is pushing 4.60%, the conversation about rates starts from a higher floor.

The chart tells an interesting story. We rallied hard off the lows in the 3.90s from just a few months ago, and now we are testing the top of the range that has essentially capped yields for the past year. Whether this level holds again or breaks through it is the most important technical question in the bond market right now.

Curious what your rate should actually be? Post your scenario in the Ultra Thread. Verified brokers run live quotes using your credit, LTV, loan type, and occupancy. No personal information, no calls, no sales pitch. Find out if you are getting a fair deal or leaving money on the closing table.  r/MortgageBrokerRates Ultra Thread

Before we get into the week ahead, a little context. The 10 year Treasury is sitting at 4.596% this morning, which is its worst level in roughly a year. That sounds alarming, and it would have been last year. But here is the important distinction: the spread between the 10 year and mortgage rates was significantly wider in 2025 than it is today. That means even though the benchmark is at the same elevated level, actual mortgage rates are in meaningfully better shape than they were at this time last year. The market has improved even if the headline number has not.

The hope right now is that the bond market treats this level as a ceiling and finds some footing here. If buyers step in at current yields and we see demand hold, that would be a constructive sign. The risk is that without a clear catalyst pulling rates lower, the path of least resistance stays higher until something changes.

And that something could come from outside the data calendar entirely. Iran remains the wild card it has been for months, and that is not changing anytime soon. Any escalation in the Middle East, disruption to oil supply, or shift in the geopolitical posture of the region can move bond markets faster than any Fed speech or economic report. It is the variable nobody can model and everybody has to watch.

Instrument	Price	Yield / Change
UMBS 5.0 (Jun)	97.35	-0.06
10 YR Treasury	96.255	4.596% (+0.005)

Now, here is what has the potential to move rates each day this week.

Tuesday, May 19th

The ADP Employment Change report prints at 8:15am and will be the first real labor signal of the week. This is a private payroll estimate, not the official government number, but it still moves markets. Pending Home Sales at 10am round out the morning.

Best case for rates: ADP comes in soft, showing hiring is cooling. That narrative supports the Fed easing sooner and puts downward pressure on yields.

Worst case for rates: ADP surprises to the upside, reinforcing the idea that the labor market is still too hot for the Fed to cut, pushing the 10 year higher and mortgage pricing worse.

Wednesday, May 20th

This is the most important day of the week. The MBA data at 7am will show us how purchase and refi applications have been trending, but the real event is the FOMC Minutes release at 2pm. This is the detailed account of the last Fed meeting and it will be parsed carefully for any language around inflation tolerance, rate cut timing, or concern about tariff driven price pressure. The 20 year Bond Auction at 1pm will also signal how much appetite there is for longer duration US debt, which directly affects mortgage bond pricing.

Best case for rates: The Minutes reveal that multiple Fed members were leaning toward cuts sooner than expected, or that inflation concerns are moderating. Strong demand at the 20 year auction would help stabilize MBS and reinforce the idea that current yield levels are attracting buyers.

Worst case for rates: The Minutes read hawkish, with language suggesting the Fed is comfortable holding higher for longer and that inflation risks from tariffs are real. A weak auction that requires higher yields to attract buyers would compound the damage.

Thursday, May 21st

Thursday is the busiest day of the week. Housing Starts and Building Permits at 8:30am will tell us whether new construction is expanding or pulling back. Jobless Claims, also at 8:30am, is the weekly read on how many Americans are filing for unemployment. The Philly Fed Business Index and the S&P Global PMI readings will round out the economic picture. The 10 year Note Auction at 1pm is the single most impactful scheduled event of the week for mortgage rates.

Best case for rates: Jobless Claims tick higher, signaling a softening labor market. PMIs show contraction or modest growth. The 10 year auction draws strong demand with a yield at or below current market levels, which would be the clearest signal yet that the bond market is ready to hold this as a ceiling.

Worst case for rates: Claims come in low, PMIs show expansion, and the 10 year auction goes poorly, requiring higher yields to clear. That combination would put significant upward pressure on mortgage rates heading into the weekend and would suggest the ceiling narrative is not yet in play.

Friday, May 22nd

Consumer Sentiment closes out the week. The headline number matters less than the inflation expectations components. The 1 year inflation expectation is currently sitting at 4.5% and the 5 year at 3.4%. If those numbers move higher, it signals that consumers expect prices to keep rising, which the Fed takes seriously and which tends to push rates up.

Best case for rates: Sentiment improves and inflation expectations drift lower, signaling that consumers believe price pressures are easing.

Worst case for rates: Inflation expectations move higher, reinforcing the argument that tariff costs are feeding into consumer psychology and that the Fed cannot afford to cut.

The Bottom Line

Wednesday's FOMC Minutes and Thursday's 10 year Note Auction are the two events most likely to cause meaningful movement in either direction. Iran is the variable sitting above all of it, capable of reshaping the week at any moment regardless of what the data says. If you have a closing in the next 30 days, the risk this week is to the upside on rates and locking near current levels makes sense. If you have more time and are comfortable with volatility, there are scenarios where Thursday and Friday deliver a better entry point. We will have updates each morning as the data hits.

Curious what your rate should actually be? Post your scenario in the Ultra Thread. Verified brokers run live quotes using your credit, LTV, loan type, and occupancy. No personal information, no calls, no sales pitch. Find out if you are getting a fair deal or leaving money on the closing table.  r/MortgageBrokerRates Ultra Thread

Every day I share two data points with my audience: the 10 year Treasury yield and the UMBS 5.0 coupon price. If you've ever wondered why I track both, this is the explanation.

The 10 Year Treasury Is Not Mortgage Rates

You've probably heard that mortgage rates follow the 10 year Treasury. That's mostly true. When investors get nervous about the economy they buy Treasuries, demand rises, yields fall, and mortgage rates tend to move in the same direction. But mortgage rates are never identical to Treasury yields. There is always a gap between them called the spread, and historically that spread runs between 1.70% and 2.00%.

So if the 10 year sits at 4.50%, a normal rate environment produces 30 year fixed rates somewhere around 6.20% to 6.50%. That difference exists because mortgages carry risks that Treasuries don't. Borrowers refinance when rates drop, which strips investors of high yielding assets earlier than expected. When rates rise, borrowers stay put longer than expected. Servicing the loans costs money. And mortgage backed securities are simply more volatile than government bonds, so investors demand a higher return to hold them.

The Spread Is the Part Nobody Talks About

Here's what most borrowers never hear: even when Treasury yields improve, mortgage rates might not move. That's because the spread itself changes.

Scenario	10 Year Treasury	Mortgage Spread	Mortgage Rate
Normal Market	4.50%	1.70%	6.20%
Volatile Market	4.50%	2.50%	7.00%

Same Treasury yield. Completely different mortgage rate. This is exactly what happened in 2022 and 2023 when the spread blew out to levels we hadn't seen in decades. Bond markets were improving on certain days and borrowers were still getting hammered on rate because investor demand for mortgage backed securities was weak and volatility was high.

Why Both Numbers Tell the Story

The 10 year Treasury tells you what the broad bond market is doing. The UMBS 5.0 coupon tells you what mortgage backed securities are actually doing. When you watch both together, the spread becomes visible in real time.

If the 10 year drops four basis points but the 5.0 coupon barely moves, the spread is widening and rates are not going to follow the Treasury lower. If both numbers improve together, that's a genuine tailwind for pricing. If MBS outperforms the Treasury, spreads are compressing and rates may improve faster than the headline yield would suggest.

Most loan officers just quote you a rate. I want you to understand why the rate is what it is on any given day. Two numbers, posted every morning, is how I do that.

Curious what your rate should actually be? Post your scenario in the Ultra Thread. Verified brokers run live quotes using your credit, LTV, loan type, and occupancy. No personal information, no calls, no sales pitch. Find out if you are getting a fair deal or leaving money on the closing table.  r/MortgageBrokerRates Ultra Thread

A busy morning for economic data, and the story it tells is genuinely split down the middle. On the inflation side, import prices jumped 1.9% in April when analysts were expecting closer to 1.0%. That gap is almost certainly tariffs starting to show up in the numbers, and inflation concerns are not great news for mortgage rates.

On the other hand, jobless claims came in a bit higher than expected this week, which is a sign that the job market is softening slightly. And April retail sales, while in line with expectations at 0.5%, look a lot less impressive when you remember that March came in at 1.7% because consumers were rushing to buy things before tariff price increases hit. That surge has faded. People are pulling back.

So you have one foot in an inflationary story and one foot in a slowing economy story. The bond market is processing both, and for now it is giving rates a small break this morning.

The wildcard is what is happening in stocks. The S&P 500 is pushing toward all-time highs, driven largely by optimism around the Trump-Xi summit and the hope that some kind of broader trade agreement could come out of those conversations. That would be genuinely good news. But here is the catch: when the stock market runs, money tends to flow out of bonds and into equities. When bonds sell off, yields go up, and mortgage rates follow. We have seen this pattern play out multiple times already this year.

The short version is that good news for the economy and good news for mortgage rates are often working against each other right now. Fun stuff. If we can get a trade deal, and that includes a peace deal in Iran, then we might hit the parlay.

Market Snapshot

Benchmark	Price	Yield / Change
UMBS 5.0	98.41	+0.19
10-Year Treasury	97.425	4.440% (2.5 bps)

Lock or Float?

Closing in 15 days or fewer, lock today. Rates are modestly better than they were earlier this week and there is no good reason to gamble that close to your closing date.

Closing in 16 to 30 days, leaning toward locking. A positive headline out of the trade talks this weekend could send stocks higher and push rates back up quickly. The improvement we have right now is real, even if it is small.

Closing in 31 days or more, you have room to float but go in with a plan. If trade talks stall or the stock rally cools, bonds benefit and rates could improve from here. Pick a target rate and lock when you hit it. Do not float indefinitely hoping for the best.

Curious what your rate should actually be? Post your scenario in the Ultra Thread. Verified brokers run live quotes using your credit, LTV, loan type, and occupancy. No personal information, no calls, no sales pitch. Find out if you are getting a fair deal or leaving money on the closing table.  r/MortgageBrokerRates Ultra Thread

The April CPI report landed hotter than expected across almost every measure this morning, and the bond market noticed. Core inflation came in at 0.4% month over month against a 0.3% consensus, and year over year core CPI accelerated to 2.8% from 2.6% in March. Headline CPI on an annual basis printed at 3.8%, above the 3.7% estimate and a meaningful jump from March's 3.3% reading. This is not the disinflationary trajectory the Fed needs to justify rate cuts, and it pushes any near term easing further off the table.

What is notable, however, is the relative resilience in MBS pricing. UMBS 5.0 is essentially flat on the day at 98.41, up just a tick, and higher coupons are actually posting modest gains. The 10 year Treasury yield is up about 2.4 basis points to 4.433%, which is a restrained reaction given the scope of the inflation surprise. The bond market came into today already somewhat defensive following the US and China trade truce announced over the weekend, and some of the inflation fear may have been partially priced in. Even so, this morning's data removes a key argument for floating.

ADP employment came in at 33,000, below the 39,250 estimate, which would ordinarily be a friendly signal for bonds. But the labor softness is getting overshadowed by the CPI numbers, and the net read for rates remains cautious.

Benchmark	Price/Yield	Change
UMBS 5.0 (Jun)	98.41	+0.01
10 Year Treasury	4.433%	+0.024%

Lock or Float?

Closing within 15 days: Lock now. CPI surprised to the upside, the Fed is on hold longer than markets hoped, and there is no compelling technical reason to leave a rate unprotected with this data in the market.

Closing in 15 to 30 days: Lock. The slight MBS resilience is encouraging but not enough to justify floating against a hotter than expected inflation print. Take the certainty.

Closing in 30 to 45 days: Lean toward locking. If UMBS 5.0 were to hold above 98.50 into the afternoon session, a cautious float conversation becomes possible, but the bias remains toward protection given today's data.

Closing in 45 days or more: Neutral to slight float. There is enough time for the picture to evolve, and the market's muted reaction to a genuinely bad CPI number suggests some underlying bond demand. Monitor the 10 year carefully. A close above 4.50% would shift this to a firm lock recommendation.

The headline story today is that inflation is not cooperating, and the path to lower rates got a little longer this morning.

Curious what your rate should actually be? Post your scenario in the Ultra Thread. Verified brokers run live quotes using your credit, LTV, loan type, and occupancy. No personal information, no calls, no sales pitch. Find out if you are getting a fair deal or leaving money on the closing table.  r/MortgageBrokerRates Ultra Thread