Last year was difficult for the mortgage industry. The Fed's aggressive series of interest rate hikes pushed up mortgage rates, which largely eliminated the incentive for borrowers to refinance their home loans. This caused mortgage origination volumes to fall from $4.4 trillion in 2021 to $2.2 trillion in 2022. It resulted in many companies exiting the business, folding, or severely cutting back costs.

Mortgage real estate investment trusts (REITs), which hold mortgage-backed securities and loans, also saw a decrease in book values per share as these assets underperformed Treasuries. One such mortgage REIT, PennyMac Mortgage Investment Trust (NYSE: PMT), has struggled this year and was forced to cut its dividend. Is another cut in store? 

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Source Fool.com