This Week; while there is May housing data; existing home sales, the NAHB June housing market index, and May starts and permits; and a couple of other key economic measurements none of the data trumps the big event this week---the FOMC meeting that concludes on Wednesday afternoon. After the recent spike in interest rates there is talk that the Fed will confirm that it will continue the current levels of purchase instead of any curtailing of the amount of its monthly purchases. The economy isn’t recovering at the rate the Fed has said it wants to see before backing away frm supporting the bond and mortgage markets. On the other hand there is as much talk that the Fed is about to taper its purchases.
The normal policy statement that is released after the meeting will be followed by Bernanke’s press conference where he will field questions. He will be pushed for specifics, how he responds will likely set the stage for the next move in long term interest rates, including the mortgage markets. Unemployment remains high, one of the keys he has said many times to when the Fed will end its support for interest rates. Inflation is not a problem other than it is lower than what the Fed has said is their target at 2.0%. Technically the bond and mortgage markets continue to reflect bearish readings. Look for volatility to increase later this week after Wednesday’s Fed comments and Bernanke’s press conference.
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By Megan Hopkins • May 30, 2013
Foreclosure-related sales totaled 21% of all U.S. residential sales during the first quarter. This is down 25% year-over-year and a 45% drop from its peak in the first quarter of 2009.
Short sales equaled 15% of all residential sales, bringing the total share of distressed sales to 36% in the first quarter. The number of non-foreclosure short sales fell 10% from the previous quarter and 25% from a year earlier. >>Read More
By Tory Barringer - Encouraging economic data helped lift fixed mortgage rates to their highest level in the past year this week, according to surveys from Freddie Mac and Bankrate.com.
Freddie Mac’s Primary Mortgage Market Survey showed the 30-year fixed rate rising to an average 3.81 percent (0.8 point) for the week ending May 30, up from last week’s 3.59 percent. Since the beginning of May, the 30-year fixed average has jumped up nearly half a percentage point. >>Read More
Mortgage Rates Rocket as Analysts Foresee End to Fed Activity
By Esther Cho - Despite improvements in home values, Radar Logic continues to contend the factors underpinning the recovery will not lead to sustainable price gains.
In March, Radar Logic’s home price index, which tracks 25 metro areas, showed a 13.1 percent year-over-year gain.
Even with the double-digit gain, the data and analytics firm touched on several points to explain why the trend won’t last, with the main one being the temporary issue of limited supply. >>Read More
California Home Loans Since 1970
Foreclosure activity continues to slide
A House panel is investigating what it believes is an attempt by Federal Housing Administration (FHA) officials to cover up the full details of the agency’s financial troubles regarding its Mutual Mortgage Insurance (MMI) Fund.
The House Oversight and Government Reform Committee reviewed emails between FHA and IFE Inc., the firm that conducted the agency’s actuarial report last year. While
FHA projected a deficit of $16.3 billion (revised to $943 million in the White House budget), the messages reveal that its losses could be as high as $115 billion under the most extreme conditions. >>Read More
Report: Potential FHA Losses Far Worse than Thought
Report: Forces Behind Price Gains Won't Last
This Week; the MBS markets will open at near very key support levels after the so-so employment report last Friday. The May employment data was somewhat better than many were expecting after the May ADP private jobs data last Wednesday was weaker than estimates. Markets still concerned about when the Fed will begin to taper its QEs, the May employment report is seen as inconclusive in the debate. The unemployment rate increased to 7.6% frm 7.5%, the main element that keeps the QEs still flowing. A week frm this Wednesday the FOMC meeting that many believe will add clarity to the question; we would be surprised if that occurred. The Fed has little reason now to change its direction.
This week is thin on economic data Thursday and Friday. May retail sales on Thursday and May industrial production and factory usage on Friday. May PPI also on Friday but these days there is no inflation and now concern that it will increase at a level that will generate fear of it. The Treasury will auction $66B of notes and bonds beginning Tuesday with $32B of 3 yr notes, Wednesday $21B of 10 yr notes that will be closely monitored on the demand. The bond and mortgage markets begin the week with bearish outlooks for rates. The 3.0 June FNMA coupon is at its key technical support, it looks shaky and obviously bearish presently.
As Prices Rise Nationally, Local Trends Tell Different Story
By Krista Franks Brock - While national home prices continue to post gains, Clear Capital’s VP of research and analytics, Alex Villacorta, insists “granularity in home prices remains key.”
Regional prices increased across the nation over the three-month period ending in May, according to Clear Capital’s most recent home price report, but metro prices were mixed.
“While there’s no questioning the validity of the recovery at this point, performances at the local level remained mixed when considering strength, sustainability and relative positions to 2006 prices,” Villacorta said. >>Read More
This Coming Week in Mortgages
This Week; has a number of key data points. The May employment report on Friday is the major release, after the strong April data last month that started the relentless increase in interest rates markets will know whether it was a one off report or the beginning of increasing hiring’s. Also this week beginning on Monday with the ISM manufacturing index and through the rest of the week each day will have data that is significant. On Wednesday the employment concerns will begin in earnest when ADP releases their number on non-farm private jobs, going into the week the estimate for ADP is an increase of 157K jobs after reporting only 119K in April.
Another reminder, do not fight the tape. Interest rates show little evidence of any improvement as the week begins. The 10 yr note may move to 2.25% before there is any interest from investors to buy fixed income treasuries or MBSs. Monday at 10:00 the May ISM manufacturing index is expected at 50.9 frm 50.7 in April, not much if that is all there is. Manufacturing continues to be a drag on the economy. No stopping the equity markets these days; as long as the stock market continues its march higher there isn’t much to hope for in the bond and mortgage markets. The end has come for the rate markets although at some level we expect there will be some interest in treasuries; what level is the unanswered quest
By Tory Barringer - Reports of strong home price gains drove confidence in the housing market up to record levels in May, Fannie Mae reported.
According to the GSE’s May 2013 National Housing Survey, Americans expressed record confidence in price gains, with 55 percent—a survey high—saying they believe prices will go up in the next year. Only 7 percent of respondents in the survey expect prices to drop, the lowest level since the survey’s inception.
In addition, the average 12-month home price chance expectation was 3.9 percent, the highest level in the survey’s history and a leap over April’s 2.7 percent forecast. >>Read More
Optimism Toward Buying, Selling Reaches Record Highs
By Tory Barranger - Competition among buyers continued to cool in May but remained fierce overall, according to Redfin’s Bidding War Report for the month.
Redfin agents reported 69.5 percent of offers written in May faced competition, a decrease from 73.3 percent in April. Year-over-year, competition was mostly flat, rising 0.2 percentage points from 69.3 percent.
According to Redfin analyst Rachel Musiker, April’s monthly inventory increase—the largest since March 2010—was “the reason for the easin’” in bidding wars
Real Estate Bidding Wars Ease in May as Inventory Rises
REAL ESTATE & MORTGAGE NEWS
This Week in Mortgage Land
06-13-2013 - National Mortgage Professional
CoreLogic released new analysis showing approximately 850,000 more residential properties returned to a state of positive equity during the first quarter of 2013, and the total number of mortgaged residential properties with equity currently stands at 39 million. The analysis shows that 9.7 million, or 19.8 percent of all residential properties with a mortgage, were still in negative equity at the end of the first quarter of 2013 with a total value of $580 billion. This figure is down from 10.5 million, or 21.7 percent of all residential properties with a mortgage, at the end of the fourth quarter of 2012. >>Read More
Nearly 850,000 Homes Return to Positive Equity in Q1
06-14-2013 - National Mortgag Professional - Freddie Mac has released the results of its Primary Mortgage Market Survey (PMMS), showing fixed mortgage rates climbing higher amid a solid employment report for May. The 30-year fixed-rate mortgage (FRM) averaged 3.98 percent with an average 0.7 point for the week ending June 13, 2013, up from last week when it averaged 3.91 percent. Last year at this time, the 30-year FRM averaged 3.71 percent. Since beginning their climb last month, the 30-year FRM has increased over half a percentage point. Also this week, the 15-year FRM averaged 3.10 percent with an average 0.7 point, up from last week when it averaged 3.03 percent. A year ago at this time, the 15-year FRM averaged 2.98 percent. >>Read More
Rates Knock on the Four Percent Door
Mortgages in The Coming Week Beginning June 17, 2013
By Christina Mlynski - California home prices increased by the most in 33 years as a result of strong sales growth in higher-priced markets and continued housing supply shortage, pushing up median home prices in May, the California Association of Realtors said.
Closed escrow sales of existing, single-family detached homes totaled a seasonally adjusted annualized rate of 431,370 units, the report noted. >>Read More
California home prices soar to new highs
MortgageOrb.com -Six former Bank of America Corp. employees have reportedly filed a lawsuit in Massachusetts federal court alleging that the bank deliberately denied loan modifications to eligible homeowners in order to force them into foreclosure.
The former employees, who worked at different bank offices across the U.S. up until last year, claim they were told by upper management to lie to homeowners about the status of their mortgage payments and documents for the purpose of forcing them into foreclosure or getting them to sign modified "in-house" loans at rates of up to 5%, according to a CNBC report. >>Read More
Lawsuit: BofA Lied To Homeowners Seeking Loan Modifications
Buying Cheaper Than Renting Til Mortgage Rates Hit 10.5%
By Jed Kolko, Chief Economist - The recent rise in mortgage rates has made buying a house a little more expensive: the increase in the 30-year fixed rate over the past month from 3.4% to 3.9% (Freddie Mac) raised the monthly payment on a $200,000 mortgage by $56, or 6%. However, because mortgage rates are still near long-term lows, and because prices fell so much after the housing bubble burst and remain low relative to rents even after recent price increases, buying is still much cheaper than renting. That means that the recent jump in rates doesn’t change the rent-versus-buy math much. >>Read More By Matthew Graham - Mortgage rates have seen better days. If the past 2 months of calamitous volatility and almost daily cost hikes weren't enough, today brings the Conventional 30yr Fixed best-execution rate to 4.25%--levels not seen since late 2011. A move of this magnitude was one of the risks heading into today's incredibly important FOMC events, but despite understanding that it was a possibility, it's magnitude can still seem surreal when compared to rate offerings not even two months ago. >>Read More
Mortgage Rates Annihilated; Brief History of All-Time Lows
By Krista Franks Brock - A plurality of prospective homebuyers responding to an industry survey anticipate down payments of less than 15 percent when they purchase a new home. Forty-four percent of respondents anticipate low down payments of no more than 15 percent, while 34 percent foresee paying between 15 and 24 percent of purchase price at closing.
Nineteen percent say they will put down more than 25 percent of their home purchase price when the purchase their next home, according to the survey conducted this May by Research Data Technology on behalf of Charlotte, North Carolina-based LendingTree.>>Read More
Prospective Homebuyers Favor Low Down Payments, Fixed Rates
Mortgages This Coming Week Beginning June 24
This Week; expect more selling in the stock market and the bond sand mortgage markets. The recent increase in interest rates has now increased the rate on the bellwether 10 yr note 100 basis points from 1.63% to 2.60%; mortgage rates up 75 basis points since early May. For over a month prior to last week talk circulated regularly that the stock market may retreat 10% on a long overdue correction, it is occurring now. Bernanke set it off after the FOMC meeting last week. Saying the Fed was ready to begin cutting back on the stimulus by the end of the year, and completely done by the middle of 2014. Markets had been expecting the Fed would begin tapering, what the market didn’t expect was Bernanke’s clear comments, it wasn’t thought to be as soon as what he indicated. What Bernanke added was that it will be dependent on the economic outlook as to when the Fed would pull the trigger.
The Fed obviously believes the economy is on a path of growth, albeit slowly. The overall consensus from the private sector also is forecasting better economic growth. We wouldn’t want to argue with the forecasts, they are out there and markets are taking it all seriously; however the employment sector shows very little increased strength and without increased job growth all other measurements must be considered marginal at best. Any slowdown based on the data points over the next two weeks, including the June employment report on July 5th, will be closely monitored. A soft June employment report will change the outlook for the Fed tapering. Expect continued market volatility this week and next.
By Andrea V. Brambila - Surging mortgage rates may have little effect on the housing market, at least in the near term, housing experts say.
Mortgage rates rose sharply last week following comments from Federal Reserve Chairman Ben Bernanke that the Fed will begin tapering off its asset purchases later this year if incoming data continues to show the economy is on the mend.
Mortgage rates had been rising since early May, as investor demand for mortgage-backed securities (MBS) that fund most U.S. mortgage loans weakened on speculation that the Fed was preparing to scale back its $85 billion-a-month "quantitative easing" program. >>Read More
Experts doubt surge in mortgage rates will derail housing recovery -
By Tory Barringer - A new index from the Mortgage Bankers Association (MBA) and AllRegs shows credit availability opened up slightly from April to May.
The Mortgage Credit Availability Index (MCAI) feeds current mortgage underwriting parameters into a single index number to measure credit availability from month to month. It is calculated using several metrics related to borrower eligibility and underwriting criteria for more than 85 lenders and investors.
For lenders, the MCAI will provide an industry wide summary statistic regarding the trend in mortgage credit availability. >>Read More
Mortgage Credit Availability Trends Upward in May
By Mark Lieberman - The Pending Home Sales Index (PHSI) rose 6.7 percent in May to 112.3, its highest level since December 2006, the National Association of Realtors, which compiles the index, reported Thursday. Economists expected the index to improve 1.0 percent to 107.1 from April’s 106.0. In December 2006, the index was 112.8.
The May increase was larger than forecast in part because April’s index was revised downward to 105.2. >>Read More
NAR Pending Home Sales Index Jumps in May
The Coming Week in Mortgage Land
This Week beginning July 1; is employment week for June data, in the meantime a few key reports will draw attention. The June ISM manufacturing and servicing sector indexes, May factory orders and June auto and truck sales. The stock market continues to improve on increasing belief the economy is improving; it is all in the eye of the beholder and there are a lot of eyes focused on economic growth. The Fed stoked up the belief when Bernanke said the Fed was readying its exit from market supports because the Fed sees better economic growth ahead. The bond and mortgage markets remain bearish with rates unlikely to fall much frm present levels; but like equity markets it is dependent on economic performance. The week will; likely continue with increased volatility as has been the case for the last three weeks.
In late March, HousingWire reported the Federal Housing Finance Agency would expand its suite of mortgage modification tools for Fannie Mae and Freddie Mac servicers.
The Streamlined Modification Initiative is now in effect, in order to encourage servicers to handle delinquencies earlier, minimizing losses to the GSEs and taxpayers, while cutting back some of the red tape that slows down the traditional approval process.
Streamlined Modification Initiative begins
All eligible borrowers must make three on-time trial payments, the FHFA said. Once those payments are made, the loan modification takes permanent effect.
The program expires Aug. 1, 2015..
There is a remarkable degree of agreement among prevalent purveyors of Home Price Indices that prices this spring have risen higher and faster than in any period since early 2006. Joining the chorus today, CoreLogic said today that its Home Price Index (HPI) rose 12.2 percent in May compared to May 2012, marking the biggest annual increase since February 2006.
CoreLogic said that May was the 15th consecutive month that its index, which includes distressed home sales, had noted a national increase in prices. CoreLogic also said that prices had increased 2.6 percent on a month-over-month basis. >>Read More
Home Price Surge Will Accelerate Next Month - CoreLogic
By Nora Caley - In some markets, there are so few homes for sale that when a seller lists a home, several buyers make offers. The challenge is that the winning bid might not reflect the real value of the house. In another anecdotal sign that the housing market is improving, real estate experts are reporting bidding wars in residential real estate. In some markets, there are so few homes for sale that when a seller lists a home, several buyers make offers. The competition inflates the home price, but sometimes, the appraisal does not match the price. >>Read More
Appraisers Try To Keep Up With The Bidding Wars
National Mortgage Professional - The May Mortgage Monitor report released by Lender Processing Services Inc. (LPS) found that the national delinquency rate continued to fall in May, marking the largest year-to-date drop since 2002. Delinquencies are down more than 15 percent since the end of December 2012, coming in at 6.08 percent for the month. As LPS Applied Analytics Senior Vice President Herb Blecher explained, much of this improvement is supported by the fact that new problem loan rates are approaching the pre-crisis average.>>Read More
May Experiences Largest Year-to-Date Decline in Delinquencies in 11 Years
Mortgage lending standards loosened slightly in June, indicating that mortgage credit is more available, according to the Mortgage Credit Availability Index (MCAI), a report from the Mortgage Bankers Association (MBA) which analyzes data from AllRegs Market Clarity product. The MCAI increased to 109.8 last month which is almost one percent higher than the index reading from May. Lower MCAI values indicate lending standards are tightening, while higher index values and increases to the index are indicative of a loosening of credit. Read More in National Mortgage Professional
Mortgage Credit Availability Rises in June
In its quarterly survey of U.S. bank risk professionals, FICO found that lenders expect demand and supply for consumer credit to reach equilibrium in the second half of 2013. Sixty percent of respondents expected both the amount of credit requested by consumers and the amount of credit extended by lenders to increase over the next six months.>>Read More in National Mortgage Professional
FICO Study Finds U.S. Economy in State of Full Recovery
by Dan Caplinger -The dramatic rise in interest rates that has occurred over the past two months has had a big impact on the mortgage-loan market. Rates on standard 30-year mortgages have gone from below 3.5 percent as recently as late April to well above 4.5 percent currently, according to Bankrate, significantly increasing the monthly payments that new homebuyers will pay and making it harder to qualify for mortgage loans.>>Read More Daily Finance
Adjustable-Rate Mortgages Are Starting to Make a Big Comeback
Mortgage rates didn't manage the same sort of surge lower as that seen yesterday. In fact, some lenders were unchanged, but on average, rates fell to their lowest levels of the week. Most of the positivity came courtesy of overnight movement in Europe and Asia. This started the day for rates off on a strong foot and although mid-day weakness prompted many lenders to hike rates a bit, the worst of the adjusted rate sheets were still at least as good as yesterday's. That means the 30yr fixed best-execution rate remains at 4.625%. Most of the improvements were seen in the form of lower borrowing costs. At this point, we're closer to moving down to 4.5% than up to 4.75%. >>Read More Mortgage News Daily
Mortgage Rates End Week at Lows
The Coming Week in Mortgage Land
This Week; there are a number of key economic releases but the major focus this week is Bernanke testifying in the House and Senate on the economy, employment and inflation. Likely he will field a lot of questions from politicians about what the Fed intends to do with its QEs and more grilling on the state of the economy and unemployment that refuses to subside. He goes before the House Financial Services Committee on Wednesday and then to the Senate’s Banking Committee on Thursday. At this moment markets continue to lean towards the Fed beginning to taper as soon as Sept but Bernanke is keeping markets on edge by changing is tune frm one speech to another.
Economic data this week includes June retail sales on Monday, June CPI, June reports on industrial production and factory use, and June housing starts and permits. The technical picture in the bond and mortgage markets remains bearish although last week both markets saw nice rebounds frm the week prior. We expect markets will trade in narrow ranges early this week ahead of Bernanke. Until the 10 yr note can close below 2.50% the outlook is still bearish. It isn’t wise now to anticipate that interest rates will decline much. Maybe Bernanke can swing the outlook to a more positive outlook, but if that were to occur he would have to imply the Fed will not begin tapering until next year.
While June inventories continue to be down on year-over-year basis, they rose for the sixth consecutive month and are steadily returning to more normal levels. The number of homes listed for sale increased by 4.3 percent in June to 1.9 million homes, the highest level in the last year, according to monthly data released Monday by realtor.com.
Inventories on realtor.com reached their highest level in more than a year, suggesting that market fundamentals continue to be strong and that housing supply in many markets is gradually catching up with housing demand. At same time, the median age of the inventory increased by just one day in June, suggesting that housing sales are generally keeping pace with new property listings. Read more Real Estate Economy Watch
Realtor.com: Inventories are Returning to Normal
By Robert Ottone -“The Qualified Mortgage (QM,) lack of availability and lack of downpayment is going to continue to drive the rental market, which is a shame, because renters often can’t qualify to buy homes,” said John Hudson, former Government Affairs Committee Chair with the NAMB—The Association of Mortgage Professionals. “A lack of affordable housing is something I see happening in the near-future. This is a huge problem, debt-to-own ratios are pretty ridiculous.” Read More National Mortgage Professional
Qualified Mortgages Shutting the Door to Home-Ownership?
By Matthew Graham - Mortgage rates improved moderately Wednesday, making it back to levels not seen since July 3rd. That makes today something of a symbolic victory as July 3rd was the last trading day before rates swung roughly a third of a point higher in one fell swoop on Friday July 5th. Conventional 30yr fixed best-execution is now down to 4.5 percent on average though several lenders are competitively priced at 4.25 - 4.375 percent. This doesn't necessarily mean that one lender will have the same closing costs at 4.5 as another would at 4.25 (though that is roughly the range between the best and worst), simply that it may make financial sense to some borrowers to pay more closing costs in exchange for a lower rate. >>Read More Mortgage News Daily
Mortgage Rates Lower After Bernanke Testimony
RealtyTrac has released its Midyear 2013 Home Flipping Report, which shows 136,184 single family home flips—where a home is purchased and subsequently sold again within six months—in the first half of 2013, up 19 percent from a year ago and up 74 percent from the first half of 2011. The report also shows that real estate investors made an average gross profit of $18,391 on single family home flips in the first half of the year, a nine percent gross return on the initial purchase price. That was up 246 percent from an average gross return of $5,321 in the first half of 2012 and an average loss of $13,206 in the first half of 2011. Read More National Mortgage Professional
First-Half Home Flipping Up 19 Percent From Last Year
By Robert Zimmer - WE’RE HEARING that the change in interest rates from ever-decreasing to something else—two weeks ago, we learned that weekly mortgage rates jumped the most in a week since 1987—is a short-term phenomenon, but also a long-term one. Washington doesn't recognize yet what this will mean, since most policymakers have never functioned in anything but a declining-rate environment.
How long have rates been falling? A very long time. Thirty-year-fixed mortgage rates have been falling consistently since 1982. Interest rates in general, benchmarked off prime rates, have been coming down since late 1980. Read More National Mortgage News
Stuck on the Up Elevator—and We Can’t Get Off
By Brena Swanson - Mortgage rates shot up after the Fed suggested a potential pullback on quantitative easing, but don't expect them to soar in the second half of 2013. Instead, analysts see gradual growth when it comes to mortgage rates.
The market is seeing a lot of volatility due to the Fed's talks of tapering, said Leonard Kiefer, deputy chief economist with Freddie Mac. Rates will likely trend up, but won't spike, although there might be week-to-week changes, Kiefer added. >Read More Housing Wire
Analysts: Expect mortgage rates to rise, not soar
By Tory Barringer - After a somewhat slow first quarter, the national housing recovery took the pace up a few notches in Q2, Zillow reported.
According to the company’s second-quarter Real Estate Market Reports, the U.S. Zillow Home Value Index (HVI) rose to $161,100 as of the end of June—up 2.4 percent quarter-over-quarter and 5.8 percent year-over-year. >> Read More MReport.com
U.S. Home Value Appreciation Picks Up Speed in Q2
Trulia estimates backlog in household formation at 2.4 million
By Paul Hagey - Household formation, especially among young adults between 18 and 34 years old, lags far behind historical norms but will bounce back slowly in the years ahead, according to a recent analysis by Trulia Chief Economist Jed Kolko.
Before the housing bust, an average of 1.1 million households — defined as one or more people who live in the same home — were formed each year in the U.S. >>Read More Inman News
‘Missing households’ represent big source of pent-up demand
House-flipping is back, flourishing again
By: Diana Olick - For the past several years single-family housing investors have been playing the buy and hold game. Strong rental demand and soft home prices made that the best bet. Now, with home prices up more than 12 percent from a year ago, the strategy is suddenly changing. >>Read More CNBC
House-flipping is back, flourishing again
By Kathleen M. Howley & Prashant Gopal - Jung Lim plans to offset the cost of rising mortgage rates by using an adjustable-rate loan to buy a home for his expanding family. For the California endodontist, the money he’ll save makes up for the ARM’s risky reputation.
Lim, 38, whose wife is expecting a second child in December, is leaving a two-bedroom condo in Los Angeles’s Hancock Park to buy a four-bedroom house in the city’s Sherman Oaks neighborhood for $1.12 million. His lender offered him a rate for an adjustable mortgage that is about a percentage point cheaper than a fixed loan. >>Read More in Blooberg
Americans Gambling on Rates With Most ARMs Since 2008
After reaching the highest level in over six years, pending home sales declined in June, with rising mortgage interest rates beginning to impact the market, according to the National Association of Realtors. The Pending Home Sales Index (PHSI) edged down 0.4 percent to 110.9 in June from a downwardly revised 111.3 in May, but is 10.9 percent higher than June 2012 when it was 100.0; the data reflect contracts but not closings. Pending sales have been above year-ago levels for the past 26 months, and the pace in May was the highest since December 2006 when it reached 112.8. >>Read More National Mortgage Professional
Rising Rates Begin to Impact Pending Home Sales in June
Eliminating the federal tax code’s deduction for mortgage interest could have a dramatically negative effect on jobs and economic growth if not paired up with other tax reforms to cushion the impact, according to a new study by the Tax Foundation. The mortgage interest deduction is one of the largest tax expenditures currently being reviewed in Congress for possible elimination as part of comprehensive tax reform legislation. >>Read More National Mortgage Professional
Eliminating Federal Tax Code for Mortgage Deduction Would Shrink Economy by $254 Billion
By Esther Cho -
Rising interest rates aren’t just a burden for potential homebuyers. According to the latest survey from Redfin, 47 percent of sellers said they are worried about rising rates, expressing concerns that buyer demand will be lowered as a result. The share is up drastically from 23 percent in the previous quarter.
Seller concerns over rising prices, however, eased in the latest quarter, falling from 32 percent to 29 percent quarter-over-quarter. >>Read More MReport
Survey: Sellers Sweating Rising Interest Rates
By Kerri Ann Panchuk - Bank of America’s legal troubles in the mortgage space are far from over.
The firm, which took over Countrywide’s legacy subprime business in the wake of the financial crisis, reports in a securities filing that the Department of Justice plans to file civil charges against BofA and related entities over two jumbo prime mortgage securitizations.
BofA reported this development in its 10-Q filing with the Securities and Exchange Commission.>> Read More HousingWire
DOJ to File civil Charges Against B of A
By Tory Barringer - The latest Home Index Survey (PGHI) from PulteGroup shows current homeowners might accelerate their timeline to “move up.”
With home values on the rise, 43 percent of move-up buyers in PulteGroup’s survey indicated they plan to purchase a new home within the next five years. In addition, 76 percent of respondents believe they can sell their current home within the next two years for a price that would allow them to move.
Survey: Move-Up Buyers Nearly Ready to Take Action
By Robert Ottone - Charlotte, N.C.’s Bank of America (BofA) is one of six banks being investigated by the U.S. Department of Justice (DOJ), New York Attorney General Eric T. Schneiderman and the Securities & Exchange Commission (SEC) for shady regulator activity during the financial crisis. The letters sent out by Schneiderman reportedly call for information regarding a record of banking transgressions including overdrawn accounts, bounced checks and fees in an effort to protect against future fraud and risky customers. The DOJ is currently planning on filing two civil charges against BofA regarding jumbo prime mortgage securitizations. The SEC is piggybacking on the DOJ’s charges. >>Read More National Mortgage Professional
BofA Preps for Storm of Litigation
By Tory Barranger - CoreLogic’s Home Price Index (HPI) jumped 11.9 percent year-over-year in June, the company reported Tuesday.
June’s data falls short of the 13.2 percent growth projected in CoreLogic’s Pending HPI for June. Month-over-month, June’s index was up 1.9 percent from May, a full percentage point short of predictions (partially explained by a revision in May data).
Out of all states, the five with the highest home price appreciation were Nevada (26.5 percent), California (21.4 percent), Wyoming (16.7 percent), Arizona (16.2 percent), and Georgia (14.3 percent) >> Read More MReport.com
Home Prices Up 11.9% in June, More Double-Digit Gains Expected
Tory Barringer - American consumers grew increasingly positive on housing in July, according to results in Fannie Mae’s National Housing Survey.
Undeterred by rising mortgage rates, the majority of consumers polled expressed belief that the market will continue to improve, with 53 percent saying they expect home prices will go up in the next year—though that figure does represent a decline of 4 percentage points from June’s high. The percentage of those expecting prices to drop fell to a survey low of 6 percent. >>Read More MReport.com
Americans Optimistic on Housing, Neutral on Economy
Mortgage rates steady after period of volatility
California adds more than 500,000 renters while the homeownership rate declines amidst a boom.
California food stamp users jump from 2.2 million in 2008 to nearly 4 million today.
The California housing market is providing us with two different pictures. First, home prices have surged and inventory is still very low (although increasing from the spring low). However, the homeownership rate continues to decline from the peak reached in 2006 of 60.2 percent. Today the California homeownership rate is 54.5 percent. How big of a difference is this? Since 2007 California has added a net of 500,000 renter households while losing a net of 233,000 homeowners. Yet the market continues to boom in the face of a declining homeownership rate. As we look at the market today we start seeing a slowdown in the speed in which flips are being accepted and inventory is rising. With higher interest rates and the fall season just before us, will the market thaw or continue to accelerate?
If Congress shuts down Fannie Mae and Freddie Mac, borrowers likely will end up paying slightly higher mortgage rates. Proposed House and Senate bills would wind down the two firms over five years and scale back the government intervention in guaranteeing mortgage securities.
The House GOP bill would virtually privatize the mortgage market, while the Senate's bipartisan plan would limit Washington's role in insuring mortgage securities and retain the federal government as an insurer of last resort. Both plans are meant to shift more mortgage financing risk from the government to the private sector in order to prevent future taxpayer-funded bailouts. Read More
Privatizing Mortgage Finance Will Cost Borrowers
A major lender has announced a new wave of job cuts, even as a Department of Justice criminal investigation encroaches.
JPMorgan Chase is cutting 475 jobs in its mortgage default servicing unit, according to the Dallas Business Journal. All the cuts will affect Chase employees in Texas, with the majority in Fort Worth. There will be 650 employees in Rancho Bernardo California and another 450 mortgage jobs are in South Carolina are on the chopping block, according to a McClatchy-Tribune Information Services report. >> Read More MPA
Major lender under criminal investigation announces new round of job cuts
By Nick Timiraos - Fannie Mae is in discussions to curb its purchases of mortgages that require a minimum down-payment of 3%, according to people familiar with the discussions.
Fannie never stopped accepting purchases of loans with 3% down payments, even after lending standards were ratcheted up following the housing bust. But many lenders stopped offering them, in part because they weren’t able to obtain mortgage insurance for those loans, which Fannie requires. >>Read More
Fannie Could Curb Low-Down-Payment Loans
FHA Help for Borrowers with Major Credit Issues
The waiting period for borrowers to apply for an FHA loan with major derogatory credit issues has been reduced to one year in some cases. Previously, with few exceptions, the waiting period was three years for a foreclosure and two years for a Chapter 7 bankruptcy.
Borrowers that may be otherwise ineligible for an FHA-insured mortgage due to FHA's waiting period for bankruptcies, foreclosures, deeds-in-lieu, and short sales, as well as delinquencies and/or indications of derogatory credit, including collections and judgments, may be eligible for an FHA-insured mortgage if the borrower:
- can document that the derogatory credit is the result of an Economic Event.
- meets Loss of Income Criteria
- has completed satisfactory Housing Counseling, and
- meets all other HUD requirements.
DOJ and FBI retract previous mortgage fraud numbers
Analysts expect 25% decline in suspected mortgage fraud in 2012
By: Megan Hopkins - The government continues its ongoing battle against mortgage fraud, even as it finds itself retrenching from suspiciously high mortgage fraud numbers reported back in 2012.
Last October, the Department of Justice and the FBI released a report claiming their Distressed Homeowner Initiative found 530 criminal defendants in cases involving more than 73,000 mortgage victims and losses of more than $1 billion in 2012 — startling numbers to anyone.
By Megan Hopkins - Existing-home sales flourished in July, with the median price continuing to see double-digit year-over-year increases, according to data from the National Association of Realtors.
Total existing-home sales — which include single-family homes, townhomes, condominiums and co-ops — rose 6.5% in July to a seasonally adjusted annual rate of 5.39 million units, up from a downwardly revised 5.06 million in June. Year-over-year, existing-home sales rose 17.2% from the 4.50 million-unit pace set in July 2012. >> Read More HousingWire
Existing-home sales not reflective of current market
Investor influence remains high
Mortgage Rates Push to New 2yr Highs
Mortgage rates were higher again today, extending yesterday's movement following the FOMC Minutes. This morning's Jobless Claims report showed a slightly higher number of initial unemployment filings, but rather than help push back against yesterday's weakness, this did more to help rates level-off. Had the data been stronger than expected, the damage would have been worse. Conventional 30yr Fixed quotes (best-execution) are most prevalent at 4.75% with 4.875% being the next closest level for ideal scenarios. >> Read More
July New Home Sales Plunge to 9-Month Low
The seasonally adjusted annual rate of new home sales dropped a stunning 13.4 percent to 394,000 in July. Economists surveyed by Bloomberg expected June sales to drop to 487,000 from June's originally reported 497,000. June sales were revised to 455,000. The report for July showed a slight shift to higher-priced homes as houses priced at $500,000 or more accounted for 11 percent of July sales, up from 9 percent in June. Homes priced at $300,000 or less represented 62 percent of all July sales, down from 64 percent in June. » Read More
National Home Prices Nearing Pre-Crash Levels
By Jann Swanson
Home prices keep edging closer to pre-crash price levels and today's Home Price Index report from Lender Processing Services (LPS) indicates that national prices are now back within 15.2 percent of that peak. The index for June rose to $229,000 from 226,000 in May, an increase of 1.2 percent and is up 6.9 percent from the end of last year. The peak, in June 2006, was $270,000.>>Read More
Shadow Inventory down 30 Percent Annually
By Jann Swanson -
Delinquency rates and incidence of properties in foreclosure fell again in July, Lender Processing Services (LPS) reports, but more than 4.5 million mortgage loans remain in some category of distress. The company released a preview of its Mortgage Monitor reflecting conditions at the end of July, a key finding of which was a dramatic year-over-year decrease in the pre-sale foreclosure inventory. >> Read More
Regulators Release Revised QRM Rule
The Federal Reserve and five other regulators today introduced a revised qualified residential mortgage (QRM) rule that requires lenders to keep a stake in certain loans that do not meet QRM standards.
The proposed revisions to the QRM rule are designed to bring it in line with the provisions of the qualified mortgage (QM) rule developed by the Consumer Financial Protection Bureau (CFPB), going into effect in January, which requires that borrowers' total debt-to-income ratio be capped at 43% and that lenders conduct greater due diligence in determining a loan applicant's ability to repay by taking a deeper dive into their income and debt records. >>Read More
National Median Price Hits $174,500 in July, Up Six Percent Over Last Year
National Mortgage Professional
RealtyTrac has released its July 2013 U.S. Residential & Foreclosure Sales Report, which shows that U.S. residential properties sold at an estimated annualized pace of 5.5 million in July 2013, up four percent from the previous month and up 11 percent from a year ago—the biggest annual increase in sales volume so far this year. While sales volume continued to increase nationwide, eight states posted annual decreases in total sales, including California (down 17 percent), Arizona (down 11 percent), Nevada (down seven percent), and Georgia (down two percent). Those four states also posted the four biggest annual increases in median home prices in July: California (up 31 percent); Nevada (up 27 percent); Arizona (up 21 percent); and Georgia (up 20 percent).>>Read More
The Dying Legacy of the Financial Crisis
By John Maxfield |- The financial crisis is not dead, but it is dying. Investors were reminded of this earlier today. According to the data analytics firm CoreLogic, the number of home foreclosures completed in the month of July fell by 25% compared to the same month last year.
"Foreclosures and delinquency rates continued their rapid descent in July," noted President and CEO Anand Nallathambi. "Every state posted a year-over-year decline in foreclosures and serious delinquencies fell to the lowest level since December 2008." >>Read More
Despite Rising Home Prices, 12.2 Million Homeowners Still Underwater
More than 3 million underwater homeowners have returned to positive equity in the past year, due mainly to rising property values. However, it's going to take years before a majority of homeowners who are underwater on their mortgages return to positive equity.
According to Zillow's Negative Equity Report, the national negative equity rate continued to fall in the second quarter, dropping to 23.8% of all homeowners with a mortgage. >>Read More
Home Prices Unfazed By Rising Rates in July
By Jann Swanson - Home prices jumped by 1.8 percent nationally during the month of July. CoreLogic reported that values on its Home Price Index (HPI) which excludes sales of distressed homes, rose in every state during the month, and when distressed prices are included only one state, Delaware, posted a drop in its HPI.>>Read More
Seven of the Twelve Dirtiest Cities in America are in California
As a lifelong Californian I was appalled that according to a Frobes Report seven of America's twelve dirtiest citiies are located in California. The booby prize this year for Dirtiest City in America goes to Fresno, California. This Central Valley city suffers some of the worst air in the nation, and a water supply so degraded that the city used to tell pregnant women not to drink from the tap. Fresno epitomizes the environmental challenges of the Golden State. And it’s not alone. Plenty of its neighbors in central California like Modesto, Stockton and Bakersfield have it almost as bad. (Other California metro areas ranked among the 20 Dirtiest Cities include San Jose, Riverside and Los Angeles >>Read More
By Brian Stevens - Gary Thomas, President of the National Association of Realtors (NAR) is encouraged about QRM revision removing the 20% down payment requirement.
So in my daily outreach of industry opinions and direction I always look at what the Consumer Financial Protection Bureau (the CFPB) has to say about things. After all, they are not only the new kid on the block, they’re the new kid that’s on steroids, understands part of your situation, and is very willing to lay laws about your behavior. If that sounds a little heavy handed, well, it is a little heavy handed. >>Read More and see Video
The CFPB.is Here To Protect You - Kinda Like Big Brother
Zillow downgrade forces investors to pullback
By Christina Mlynski - Real estate internet companies grabbed the attention of investors Thursday after a negative report on Zillow (Z) rattled the market.
It began when Morgan Stanley (MS) analyst Scott Devitt downgraded Zillow's rating from 'equal weight' to underweight, while raising the price target from $66 to $70, StreetInsider reported.>>Read More
Survey: Interest Rate Increases Catching Up to Buyers
Ascending mortgage rates are starting to weigh on homebuyers nearly as much as low inventory, according to Redfin's Real-Time Homebuyer Survey. Out of homebuyers polled, 63 percent said rates have impacted their ability to buy a home at least "somewhat." When asked how rates have affected their home search, 33 percent said they're speeding up their search before rates get too high, 20 percent said they're slowing their search, and 1 percent have stopped looking altogether. » Read More
Fannie Mae: Consumers Lost Some Confidence In August
by MortgageOrb.com - Rising interest rates, combined with uncertainty over when the Federal Reserve will start tapering its bond buying program, as well as concerns over the upcoming budget and debt ceiling debates in Congress - not to mention the potential for U.S. military strike in Syria - combined in August to negatively impact consumer attitudes toward the housing market, according to Fannie Mae's National Housing Survey.>>Read More
Survey: Consumer Attitudes Mirroring Market Slowdown
By Tory Barringer -The housing market recovery is finally starting to slow—and consumers across the country have picked up on it, according to findings in Fannie Mae’s August 2013 National Housing Survey.
“Consumer attitudes are proving consistent with recent slowing housing market trends, indicating that they are well-attuned to the direction in which the housing market is moving,” Fannie Mae said in its monthly release. “Americans’ outlook on housing growth—which has been trending upward since the beginning of the year—has hit a plateau, likely due to concerns regarding the potential tapering of the Federal Reserve’s asset purchases.”.
Richmond, CA Moves Forward With Eminent Domain Plan
by MortgageOrb.com - Richmond, Calif.'s controversial plan to use eminent domain to seize underwater mortgages in an effort to help homeowners avoid foreclosure took a giant leap forward on Wednesday when the city council voted 4-3 in favor of moving forward with the proposal.
The city will now work with Mortgage Resolution Partners (MRP) to create a detailed plan that will be developed in conjunction with public officials, according to a Reuters report.
The concept involves a local government purchasing underwater mortgages secured by properties within its borders, restructuring them to reflect actual property values and then reselling them on the secondary market. In the event servicers and investors are unwilling to participate, then the municipality would seize the loans (with compensation to the owners) using eminent domain.>>Read More
Use the Dropdown Menu to Pick an Area to Search for Homes in North San Diego County, California.
After the initial search use ADVANCED to refine your search.
Trends Show Shift in Market Dynamics as Summer Ends
By Tory Barringer - As the summer buying season draws to a close, key housing market indicators show trends stabilizing in a way that hasn’t been seen for some time.
Realtor.com released Thursday its National Housing Trend Report for August, which shows prices leveling out as the inventory recovery becomes more widespread.>>Read More
Rent-to-Own Scam Nets over $1 Million from FHA Lenders
By Amilda Dymi - A mortgage fraud ring of professionals operating in Syracuse allegedly obtained more than $1 million from lenders while preying on first-time homebuyers and taxpayers.
New York Attorney General Eric Schneiderman filed a lawsuit against five defendants accused of running a rent-to-own housing scam that targeted first-time buyers with low credit offering them fraudulent no downpayment, no closing cost purchase loan options they would use to convince lenders they were paying off underlying mortgages—then pocketing the money.>>Read More
Wednesday, Rates Plummet as Mortgage-Backed Securities Soar as Fed Maintains Bond Buying -- Update
By Al Yoon - Mortgage-backed securities rallied after the Federal Reserve kept its bond-buying program in place, surprising investors who had anticipated the central bank would begin to wean the markets from its support.
Bonds issued by government entities such as Fannie Mae jumped more than one point in price, mostly outpacing the gains in Treasurys. Gains in the "agency" mortgage bonds narrowed the gap between benchmark Fannie Mae MBS yields and 10-year Treasury note yields to 0.71 percentage point from 0.74 point on Tuesday--and to the smallest since mid-May--Credit Suisse data show.
Rise in Rates Not Stifling Housing Production
Led by a solid increase in single-family starts, nationwide housing production rose 0.9 percent to a seasonally adjusted annual rate of 891,000 units in August, according to figures released by the U.S. Department of Housing & Urban Development (HUD) and the U.S. Census Bureau. Meanwhile, construction of multifamily buildings slowed following a rebound in the previous month. >>Read More
Trulia Report Finds Its Still Cheaper to Buy a Home Than to Rent
Trulia has released its Summer 2013 Rent vs. Buy Report, revealing whether buying a home is more affordable than renting in America’s 100 largest metropolitan areas. Looking at homes for sale and for rent on Trulia between June 1 and Aug.31, 2013, this study compares the average cost of renting and owning for all homes on the market in a metro area, factoring in all cost components including transaction costs, taxes, and opportunity costs. >>Read More
Potential homebuyers show confidence in housing
Megan Hopkins - More than half of Americans, 55% to be exact, are confident that home prices will go up over the next 12 months, according to a new Bankrate.com report. Of those surveyed, 27% believe home prices will remain unchanged, while 9% anticipate a decline in home prices. >> Read More
Home price appreciation expected to continue
HousingWire StaffS - Ultimately, the debate over Fannie Mae and Freddie Mac boils down to whether all Americans should continue to have relatively easy access to the pre-payable, 30-year, fixed-rate mortgage, an editorial in The Wall Street Journal claims.
American homeowners love the 30-year mortgage, which isn't available in most other countries. It provides payments that are stable for the life of the loan, which makes finances easier to manage.
But there are still those who disagree:<< Read More
Another debate over the 30-year mortgage
Redfin study finds that even within neighborhoods, schools can have big impact.
An analysis by Redfin illustrates the steep price premiums that homeowners are willing to pay for homes served by top-ranked schools, offering the latest concrete evidence that buyers place remarkable importance on the quality of schools.
The sky-high premiums help explain the ongoing race among listing sites to provide razor-sharp school information. >>Read More
Top schools equal higher home prices
Call it the summer of the cash sale.
All-cash home purchases skyrocketed during the summer months of 2013, with their share of total sales growing by more than 40 percent from the beginning of June to the end of August, amid sustained appetite from investors, a recent spike in interest rates and tight inventory.
Cash purchases accounted for 45 percent of sales in August, up from the 2013 trough of 32 percent seen in April and May, according to RealtyTrac data provided exclusively to Inman News. >>Read More
Five Ways Google Glass Will Change Real Estate
By Jackie Ruiz - In 2014, Google Glass will leave the testing roam and become available for consumers everywhere. The wearable tech from the search giant is the first of its kind and building hype as various industries race to use Glass to their advantage. The obvious players are there—social networks, photography, navigation—but real estate is already finding ways to use Glass in revolutionary ways.
Browsing homes and rentals online is often unorganized and frustrating. Listings have missing data, photos and information about the neighborhood. But now a person can soon walk down the street wearing Glass and see, in real time, which properties in the community are for sale and rent. >>Read More
Shiller: Housing warms up, but no bubbling
The talk of whether there is now a new bubble in housing is becoming cocktail-party discussion fodder yet again. But is there actually a bubble?
Yale economics professor and co-namesake of perhaps the most popular housing price index (the S&P/Case-Shiller HPI) weighs in on the topic this weekend in an op-ed in The New York Times. >>Read More
Price Increases Slow as Housing Market Heads Into Fall
By Tory Barringer - Home prices improved year-over-year for the 18th straight month in August, though the arrival of housing’s usual “off-season” brought negligible monthly growth, CoreLogic reported Tuesday.
According to the company’s monthly Home Price Index (HPI) report, house prices nationwide (including distressed sales) increased 12.4 percent on a yearly basis in August. >>Read More
Banks Keep Breaking Into Houses, And Homeowners Are Fighting Back
Every day in neighborhoods across the country, low-paid workers with little oversight or training decide whether to break into someone else's home.
They are independent contractors working indirectly for banks, including Wells Fargo, JPMorgan Chase and Bank of America. >>Read More
Interest Rates Feel Effects of Government Shutdown
By Tory Barringer - View Though the early days of the shutdown in Washington haven’t made a major impact on the economy yet, concerns about what might come next drove mortgage rates down for another week.
Freddie Mac’s Primary Mortgage Market Survey showed average fixed rates dropping for the third straight week, with the 30-year fixed-rate mortgage (FRM) averaging 4.22 percent (0.7 point) for the week ending October 3, down a tenth of a percentage point. A year ago, the 30-year FRM averaged 3.36 percent, only a few basis points above its all-time low.>> Read More
Asking Home Prices Slow in Hottest Markets
By Tory Barringer -Nationally, Trulia is the latest company to report a monthly slowdown in home prices—and trends indicate yearly gains may soon cool as well.Trulia reported asking home prices were up 3.0 percent quarter-over-quarter in September, the smallest quarterly change since February. At the metro level, 89 of the 100 largest markets experienced quarter-over-quarter price increases—down from 97 in June—and many of those metros reported smaller quarterly gains than before.>>Read More
by Patrick Barnard - For Now the government shutdown has entered its second week, and it appears congressional leaders are no closer to hashing out a deal. On Monday, President Barack Obama said the short-term spending plan that was approved last week in the Senate would pass in the House - that is if Speaker John Boehner is willing to allow a vote.
Meanwhile, concerns have been raised regarding the shutdown's impact on lenders and their ability to process mortgage applications. On Thursday, David Stevens, president and CEO of the Mortgage Bankers Association, released a statement saying the effect of the shutdown will only become worse as time rolls on.>>Read More
Government Shutdown Having Minimal Effect On Lenders..
Report: Housing Up to 85% of Pre-Recession Activity
By Troy Barringer - A new index from the National Association of Home Builders (NAHB) and First American suggests that about one in seven housing markets have returned to or surpassed their pre-recessionary levels of activity.
NAHB’s Leading Market Index (LMI), released for the first time Monday, measures employment growth data from the Bureau of Labor Statistics, home price appreciation data from Freddie Mac, and single-family housing permit growth from the Census Bureau to measure overall improvements in each market. >>Read More
House Members Oppose Reduction in Fannie, Freddie Loan Limits
A bipartisan group of 66 members of the House of Representatives are letting the Federal Housing Finance Agency know they don’t want to see the loan limits on Fannie Mae and Freddie Mac reduced.
The GSE regulator FHFA is considering a reduction in the loan limits as part of an effort to reduce the government’s footprint in the mortgage market.
“Such action by a single regulator would serve only to further tighten credit availability and thereby erode progress in our fragile housing recovery,” according to the congressional letter to FHFA acting director Edward DeMarco. >>Read More
Higher Down-Payment Requirements Coming in November
On November 16, Fannie Mae will implement scheduled changes to its automated underwriting system (DU or "Desktop Underwriter"). DU is used by lenders to approve loans, and several of the changes will make it harder for some borrowers to qualify. These include tougher debt calculations for Adjustable rate loans; a complete removal of interest-only options; a maximum loan term of 30yrs (instead of 40), and stricter requirements for down payments, increasing the minimum amount from 3% to 5% of the loan balance.
Consumer Confidence (Mostly) Weathers Government Shutdown
By Troy Barringer: - The University of Michigan’s Index of Consumer Sentiment declined to a nine-month low in its preliminary October reading, but analysts say the drop wasn’t as bad as it could have been.
The index plunged to 75.2 in the mid-month report, down from 77.5 at the end of September. Economists surveyed by Reuters expected a preliminary value of 76.0. Read More
5 tips for borrowers to secure the best mortgage
By Kathleen Lynn - After riding a swift updraft earlier this year, mortgage rates have steadied at around 4.5 percent for a 30-year fixed loan.
But there's a good chance they'll resume their upward path. That's one of a number of things borrowers need to know now to get the best loan.
"For planning purposes, if I were thinking of getting into the market next spring, I'd be working with numbers in the 5 percent range," said Keith Gumbinger, vice president of HSH.com, a Riverdale, N.J.-based publisher of mortgage information. That would be up from around 3.5 percent earlier this year.
Home flippers back away as real estate turnover activity declines
Brena Swanson - Home flipping activity dipped 13% from the same period a year ago, with 32,993 single-family home flips recorded in the third quarter of 2013, RealtyTrac reported Thursday.
"Increasing home prices over the past 18 months combined with decreasing foreclosures have created a market less favorable to the high quantity of middle- to low-end bread-and-butter flips that we saw late last year and early this year," said Daren Blomquist, vice president of RealtyTrac. Read More
Fannie Downgrades Forecasts in Response to Consumer Sentiment
By Krista Franks Brooks: -
On the heels of Thursday’s announcement that the federal government shutdown is coming to a close, Fannie Mae released its outlooks for the economy and the housing industry. The outlook, prepared prior to Thursday’s announcement, cited fiscal threats and the government shutdown as dampers on the economy and cause for some uncertainty.>>Read More
Home Value Appreciation Set to Ease Over the Next Year
By Kirsta Franks Brooks - The recent fast-paced home price appreciation across the country led some markets to the brink of a bubble, but deceleration over the summer months has Zillow analysts breathing a sigh of relief as the bubble threat deflates.
Home value appreciation has declined steadily for three months, according to Zillow, and half of the nation’s 20 largest metros experienced negative appreciation in September. >>Read More
Avoid the productivity parasites
By Sam DeBord -
There seems to be a disconnect, in the way we treat technology vs. the other components of our lives. Compared to other conduits that deliver either production for our business or enjoyment for our personal time, technology seems to get a free pass to slide between business and pleasure, work time and play time, without a lot of scrutiny.Real estate folks love technology. Tech can make our lives more entertaining and interesting. It can make us more efficient and productive in our workplaces. Technology, in some way, contributes to most of our top industry conversatins today. f>>Read More
Buying Competition Cools Again as Washington Drama Deters Buyers
Redfin's Real-Time Bidding Wars report shows 58.3 percent of offers written by Redfin agents across the country faced bidding wars in September, down from 60.5 percent in August. Last September, 62.7 percent of offers faced competing bids. With competition diminishing, Redfin has also observed a fall in the number of homes selling at above asking price. On average across all tracked markets, buyers paid 0.4 percent below asking price (compared to 0.3 percent in August). » Read More
BofA, Mairone Found Liable in Mortgage Fraud Case
By Carrie Bay: -A 10-person panel of jurors is holding Bank of America and a mid-level manager liable for high-risk mortgages originated by Countrywide through a program known as “Hustle” and then sold off to Fannie Mae and Freddie Mac.
After hearing arguments for four weeks in a Manhattan federal court, the jury returned a decision finding BofA liable on one charge of fraud in the civil case and finding Rebecca Mairone, who worked for Countrywide from 2006 to 2008 as COO of one of its lending divisions, liable on the civil fraud charge she faced.
Home Price Increases Spread in September, Sales Weaken
By Tory Barringer - After taking a break in the summer, home price growth got back up to strength in September, according to statistics reported by DataQuick in the company’s monthly Property Intelligence Report. Other metrics, however, weakened.
DataQuick, a specialist in property information and decisioning solutions, reported price growth “resumed at a rapid rate in September and spread to all” of its 42 reporting counties on a monthly, quarterly, and yearly basis. » Read More
MBA Puts Out 2014 Projections, Predicts 32% Drop in Originations
By Tory Barranger - Next year’s mortgage numbers are on track to fall off by nearly a third as the decline in refinances outpaces the slow growth of purchase originations, according to a forecast released Tuesday by the Mortgage Bankers Association (MBA).
MBA said it expects mortgage originations to total $1.2 trillion through 2014, a 32 percent decline from 2013’s estimate, which was upwardly revised to $1.7 trillion based on Home Mortgage Disclosure Act (HMDA) data released in September. » Read More
Where Are Mortgage Rates Heading in 2014?
Mortgage rates will likely rise above 5 percent in 2014 and average 5.3 percent by the end of 2015, according to the Mortgage Bankers Association's forecast.
That would mark a big jump over where mortgage rates stand now. The MBA reported this week that the 30-year fixed-rate mortgage averaged 4.33 percent, the lowest average since June.
The MBA expects that the Federal Reserve will decide to taper its $85-billion per month bond-purchasing program in early 2014 and end it altogether in September 2014. The Fed's bond buying program has been keeping mortgage rates low. The Fed has hinted in recent months that it will soon be winding down the program. >>Read More
CFPB Pursuing Individuals, Seeking Admissions of Guilt
It didn't attract a lot of notice at the time, but a speech last Wednesday by Consumer Financial Protection Bureau (CFPB) Director Richard Cordray appears to be making some people nervous. Cordray spoke to the Reuters Washington Summit and a story carried by the news agency quoted him as saying his agency "is committed to going after individuals, not just companies, when it punishes wrongdoers, reflecting a broader effort among enforcement officials to ensure penalties have real bite.
"I've always felt strongly that you can't only go after companies" Reuters quotes him as saying. "Companies run through individuals, and individuals need to know that they're at risk when they do bad things under the umbrella of a company." Cordray said his office is also seeking admissions of wrongdoing from persons who commit these offenses." >>Read More
Analysts: Fannie Mae LTV Threshold Will Reduce Options, Not Risk.
By Krista Franks Brock - As of November 1, Fannie Mae is no longer purchasing loans without minimum down payments of at least 5 percent. Industry experts with the Urban Institute’s Housing Finance Policy Center argue this move is arbitrary and likely to provide little benefit to the GSE or to taxpayers.
Fannie Mae’s decision to lower its maximum threshold for loan-to-value (LTV) ratios from 97 percent to 95 percent follows a similar decision by Freddie Mac a few years ago. While neither GSE will support loans with LTVs higher than 95 percent now, the Federal Housing Administration, Veterans Administration, and U.S. Department of Agriculture (USDA) will. >>Read More
Despite Late-Month Drop, Loan Apps Rebound in October
By Tory Barranger -Mortgage application volume increased throughout October, but a substantial decline recorded in the month’s final days has experts at Capital Economics doubting that the trend will continue for the time being.
Using application numbers released by the Mortgage Bankers Association (MBA), Capital Economics calculated a 7.5 percent increase in applications in October, pulling activity up from a five-month streak of declines.
Kill the cash cow? Lawmakers intent on dismantling Fannie, Freddie even as they return billions
by Ryan Smith - Fannie Mae and Freddie Mac continue to pump money into the U.S. Treasury even as lawmakers plot their demise. The two government-sponsored enterprises reported today that they will return a total of $39bn in third-quarter profits to the Treasury.
Fannie and Freddie were placed under government conservatorship in 2008 after teetering on the brink of collapse in the wake of the financial meltdown. But after being bailed out to the tune of more than $187bn, the companies have consistently returned billions of dollars to the Treasury each quarter. >>Read More
Despite an increase in funds, banks hold back lending
The funds U.S. banks had available for lending to businesses and households increased last month by $95.8 billion to an all-time record high of $2.3 trillion.
What are the banks doing with that enormous liquidity? The answer is: nothing. Banks simply put that money back where it came from: at the Federal Reserve (Fed). They chose the Fed deposits paying 0.25 percent, instead of earning 4.5 percent on new car loans, or 10 percent on two-year personal loans. >>Read More
Third-Quarter Refinancers to Save $6B Over Next Year
by Tory Barringer - Despite a steady climb in mortgage interest rates since May, borrowers continued to take advantage of low rates to refinance into lower monthly payments, Freddie Mac reported Tuesday.
According to the results of the company’s latest quarterly refinance analysis, the average interest rate reduction among those who refinanced in Q3 was about 1.8 percent, representing a savings of about 30 percent ($3,500 over 12 months on a $200,000 loan). For borrowers who refinanced last quarter, the estimated interest savings over the next year will be about $6 billion.>>Read More
Shifting Ingredients Keep Market Resilient in October
Even with the seasonal slowdown in full effect, shifting market conditions continued to boost October home sales and prices over last year, Redfin reported Wednesday in its monthly Real-Time Price Tracker.
The broker recorded 74,363 total home sales across its 19 tracked markets in October, a 1.0 percent decline from September but a 0.6 percent gain over October 2012.>> Read More
Applications for New Home Purchases Jump Up in October
By Tory Barringer - Application volume from mortgage subsidiaries of homebuilders across the country suggests a climb in new home sales throughout the month of October, the Mortgage Bankers Association (MBA) reported.
MBA’s Builder Application Survey for October shows mortgage applications for new home purchases increased by 11 percent from September. The change doesn’t include any adjustments for seasonal patterns. >>Read More
Builder Confidence Holds Steady in November
Builder confidence remained flat in the National Association of Home Builders’ (NAHB) November report, with a slight majority of builders saying market conditions are promising.
The NAHB/Wells Fargo Housing Market Index (HMI) came out to 54 this month, unchanged from October’s downwardly revised reading. An index value above 50 indicates that more builders view conditions as good than poor; November marks the sixth straight month in which confidence has hovered above the neutral mark.
Report: Recovery Suffering from 'Broken' Housing Policies
By: Ashley R. Harris - According to some, there are many issues with the U.S. government, but housing policy ranks highest. A new report published by the Opportunity Agenda, National Fair Housing Alliance, and the National Association of Real Estate Brokers (NAREB) claims that the U.S. housing policy is broken, denying millions of would-be homeowners the credit and financing they need to achieve the American Dream. This broken system can be repaired with immediate executive and administrative action in Washington, D.C., sidestepping a glacially slow and highly partisan Congress, according to the authors of the study. >>Read More
Freddie Mac: Housing will remain generally affordable
By Jacob Gaffney - next year brings a bevy of unprecedented changes to the mortgage market as it shifts from a refinance to purchase business.
Despite all of this, in an environment of rising interest rates and tightening loan criteria, Freddie Mac still believes most of the nation's housing will remain affordable. The issue that remains, is getting responsible mortgages to the homeowners who deserve them.
Frank Nothaft, chief economist at Freddie, released the enterprise's 2014 outlook report in conjunction with a HousingWire webinar he participated in. >>Read More
Is Negative Equity Part of the New Normal?
Fast-paced price increases have helped bring many underwater homeowners afloat. In the third quarter, 1.4 million homeowners rose to the surface as their home values once again outranked their equity, according to the Zillow Negative Equity Report released Thursday.
The third quarter drop in negative equity rate was the largest on Zillow’s record, which dates back to the second quarter of 2011.
The negative equity rate now stands at 21 percent, down about one-third from its peak of 31.4 percent and from 23.8 percent in the second quarter, according to Zillow. >>Read More
Ongoing Uncertainty to Unsettle Markets Going into 2014
In the aftermath of the federal government shutdown and contentious debt ceiling negotiations, Fannie Mae predicts “continued market volatility” for at least the next few months.
Consumer sentiment toward the economy and the housing market wavered last month, according to Fannie Mae’s November Economic Outlook.
Looking forward, "since many remaining policy decisions will spill over into the beginning of next year, it seems likely that both consumers and businesses will continue to pull back in the interim, leading to increased volatility in the markets,” said Doug Duncan, chief economist at Fannie Mae. >>Read More
October Pending Home Sales Down 0.6%
By: Tory Barringer - Pending home sales slipped a bit further in October, reflecting an overall declining trend amid mixed regional numbers.
The National Association of Realtors’ (NAR) Pending Home Sales Index (PHSI), a forward-looking sales indicator based on contract signings, was 102.1 in October, a drop of 0.6 percent from September’s revised level of 102.7. It was the fifth consecutive monthly decline.
Compared to October 2012, the PHSI was down 1.6 percent, NAR reported. >>Read More
Conforming Loan Limits Stay Put for 2014, Including High Cost Areas
Whether because of the uproar from some members of Congress, the Mortgage Bankers Association, National Association of Realtors, and other industry players or not, Edward J. DeMarco, Acting Director of the Federal Housing Finance Agency (FHFA) has left loan limits for Fannie Mae and Freddie Mac unchanged for the coming year. In a press release on Tuesday DeMarco said that the maximum conforming loan limits for mortgages acquired or guaranteed by the two government sponsored enterprises (GSEs) will remain at $417,000 for one-unit properties in most areas of the country >>Read More.
Pending Sales Slip to Lowest Reading in Nearly a Year
By: Tory Barringer - Pending home sales slipped a bit further in October, reflecting an overall declining trend amid mixed regional numbers.
The National Association of Realtors’ (NAR) Pending Home Sales Index (PHSI), a forward-looking sales indicator based on contract signings, was 102.1 in October, a drop of 0.6 percent from September’s revised level of 102.7.
It was the fifth consecutive monthly decline. Compared to October 2012, the PHSI was down 1.6 percent, NAR reported.>>Read More
BofA, Freddie Mac Come to $404M Agreement on Legacy Loans
By: Tory Barringer - Bank of America and Freddie Mac jointly announced Monday an agreement resolving all remaining rep and warranties claims on loans BofA sold to the GSE through the end of 2009. Under the terms of the agreement, BofA will pay Freddie Mac a total of $404 million (subtracting $13 million in credits on repurchases already made) to be released from existing and future repurchases on approximately 716,000 loans originated in the 2000s. The payment also compensates Freddie Mac for past and potential future losses. » Read More
October Price Growth Slows, Flatness Expected in November
CoreLogic's Home Price Index (HPI) report for October shows the national home price (including distressed sales) rising 0.2 percent from September, edging just above the company's predictions from last month. Year-over-year, the national price increased 12.5 percent, marking the 20th straight month of annual price increases nationally. For November, CoreLogic's Pending HPI projects home prices (including distressed sales) will sit at roughly the same level as October. » Read More