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MortgagePoint » Your Trusted Source for Mortgage Banking and Servicing News 50 November 2025 F E A T U R E S T O R Y SIDEBAR WITH STAN 'WAKE UP AND GET BACK TO WORK' Freedom Mortgage CEO Stan Middleman discusses why 2026 could bring renewed opportunity, how AI could upend interest rates, and why complacency may be the mortgage industry's biggest risk. F ew executives in housing finance have witnessed as many market cycles as Stan C. Middleman, President and CEO of Freedom Mortgage Corporation. Since founding the company in 1990, Middleman has guided Freedom Mortgage to become one of the nation's largest nonbank lenders and servicers, while also serving on the boards of the MBA, Fannie Mae, Freddie Mac, and others. When we spoke earlier this year, Middleman described 2025 as a "wait- and-see" period marked by limited movement in rates or volume. As the year closes, his outlook has proven prescient, but his focus has already shifted to what's ahead. In this con- versation, he discusses how AI could reshape employment and interest rates, why affordability pressures may persist, and what lenders should watch as the market positions for a new cycle. Q: Back in March, you described 2025 as a wait-and-see kind of year. As we close it out, what surprised you most about how the housing and mortgage markets actually performed? Did any trends play out differently than you expected? Middleman: No, the reality is it played out exactly as we anticipated. There wasn't much movement one way or the other, and we expected interest rates to be lower at the end of the year, to set up a slight improvement for next year. Q: You predicted earlier this year that rates will remain relatively stable through 2025. How do you see the Fed's current stance shaping early 2026, and what kind of mortgage rate environment should lenders and borrowers brace for? Middleman: Interest rates have stayed fairly stable. They're marginally lower, as we would have anticipated. Recently, when Amazon announced large layoffs, it gave me some pause. If, in fact, this is the first of the layoffs that are related to AI and the vast improve- ments that have started to take root in that area—the increase in unemploy- ment would result in lower interest rates. I would suspect interest rates to be somewhat lower next year. More moved from the short end than the long end. There are some balancing factors along the inflationary front that'll keep the long end somewhat more stable than the short end. However, all bets are off if unemployment rises dramatically as a result of the progress in AI. The deflationary impact of technolo- gy on the economy cannot be overstated. It's harder to predict when it hits, and it'll be substantial when it does. We could see, again, somewhat of a reformation with the interest rate environment, if in fact AI results in a larger dose of unem- ployment than expected. And if that is the case, we can expect somewhat lower interest rates. I don't know that interest rates are going to return to 2020 or 2021 levels, but I do believe that the short end can be as much as 75 or 100 basis points lower through the course of the year next year. I think unemployment could moderate, and all that would produce a larger mortgage volume for the year: perhaps two and three-quarters trillion dollars, perhaps even approaching 3 if we really get a big impact from the increase in unemployment. Whether or not that occurs, and how long it takes to occur, and when the im- pact of all that is felt, is a whole other sto- ry. If I would forced to make a bet, I would say we would probably be at $2.5 trillion as an industry in mortgage originations, a slight improvement over this year. Q: Homeownership affordability has remained one of the biggest headlines this year. Do you think 2026 will bring meaningful relief, or has Stanley C. Middleman CEO, Freedom Mortgage