Friday, August 31, 2012
Case Study: Vacation House Conserves Resources While Maximizing Relaxation
UPDATE 2-Venezuela restarts two refinery units after blast
production units at Venezuela's biggest refinery after an
explosion a week ago that killed nearly 50 people, sparked a
huge fire and halted...
Source: http://feeds.reuters.com/~r/news/usmarkets/~3/Yi3_7yfNBYg/venezuela-refinery-idUSL2E8JVISY20120901
Featured Chicago Open House Listings: August 12
News Affecting Mortgage Interest Rates 09/20/2010
Source: http://www.homemortgagenewsblog.net/news-affecting-mortgage-interest-rates-09202010.html
Funny Man Robin Williams Selling Serious Napa Vineyard Estate
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/90xcUHA3HlE/
Negative Equity Falls in Q2; Half of Borrowers Under 40 Underwater
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/TWSkf2fR7Dw/
Appraisals Continue to Affect Closings
Source: http://news.mortgagecalculator.org/appraisals-continue-to-affect-closings/
Controlling Your Home With The Touch Of An iPad
Source: http://stlhba.hbablog.com/2012/08/30/controlling-your-home-with-the-touch-of-an-ipad/
Chicago Illinois Mortgage Rates Week in Review for the Week Ending 07/06/2012
Government Study Finds Many Lack Basic Financial Literacy
American consumers want to know what’s involved in potential investments before they invest their money. That may seem like simple ...Source: http://www.credit.com/blog/2012/08/government-study-finds-many-lack-basic-financial-literacy/
5 Things to Do in Chicago This Weekend: August 17-19
Nikkei drops to 4-week closing low; Sharp shares tumble
Thursday, August 30, 2012
New mortgage rules for Social Security recipients
To get the best [...]
Matt LeBlanc Lists Pacific Palisades Home for Rent
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/ZC-UhjKLBEU/
Compile a Dog Move Kit to Make Moving Easier for Pooch
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/yWZ3HRkg5JE/
UK's Petrofac says wins Mexico Pemex offshore Arenque contract
Petrofac said Mexican state oil monopoly Pemex has
awarded it a 30-year service contract for the offshore Arenque
oil field.
Pimco, the quiet giant among commodity investors: Kemp
What Can You Rent for $3,000 a Month?
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/aooOYGmL6Mw/
Home prices gain again but consumer mood cools
Best to Even Better!
Source: http://www.totalmortgage.com/blog/current-mortgage-rates/best-to-even-better/17693
Reasons for Pursuing a Short Sale
Source: http://www.ThompsonGroupAZ.com/reasons-for-pursuing-a-short-sale/
The best photos will sell your home
Source: http://stlhba.hbablog.com/2012/08/28/the-best-photos-will-sell-your-home/
UPDATE 1-Israel Discount Bank profit dips on FIBI stake provision
Israel's third-largest bank, reported a 28 percent decline in
quarterly profit, hurt by its investment in the First
International Bank of Israel...
Romney?s Rage Against Regulation
The people who brought you the Great Economic Meltdown of 2008 have a new idea for you — although if ...Source: http://www.credit.com/blog/2012/08/romneys-rage-against-regulation/
Wednesday, August 29, 2012
Matt LeBlanc Lists Pacific Palisades Home for Rent
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/ZC-UhjKLBEU/
Active Housing Inventory Key Factor in Redfin Real-Time Home Buyer Survey
Active Housing Inventory Key Factor in Redfin Real-Time Home Buyer Survey was originally published on Chicago Agent Magazine, the leading source for news and perspective for real estate professionals in the Chicagoland area.
By Stephanie Sims Interested in what prospective clients think of the market? Redfin’s latest quarterly homebuyer survey answers could help you better reach and help your clients. Less than two weeks ago, Redfin collected data from 829 people across 19 metropolitan markets in the U.S. and compiled the results for The Redfin Real-Time Home Buyer Survey. Redfin Real-Time Home Buyer Survey ? Prospective Buyers and the Housing Market The Redfin Real-Time Home Buyer Survey findings included: Forty six percent believe now is a good time to buy, down two quarters in a row; and ...
Active Housing Inventory Key Factor in Redfin Real-Time Home Buyer Survey was originally published on Chicago Agent Magazine - For the well-informed real estate professional, the leading source for news and perspective for real estate professionals in the Chicagoland area.
Source: http://feedproxy.google.com/~r/chicagoagentmagazine/news/~3/2MECZ9QWShM/
Up to $60 billion in savings from pension reform: Calpers
NAR?s Pending Home Sales Index Hits Highest Level in Two Years in July
NAR’s Pending Home Sales Index Hits Highest Level in Two Years in July was originally published on Chicago Agent Magazine, the leading source for news and perspective for real estate professionals in the Chicagoland area.
By Peter Ricci The Pending Home Sales Index, a forward-looking indicator of home sales based on contract signings, rose 2.4 percent from June to July and reached its highest level in more than two years, or, since the expiration of the first-time homebuyer tax credit,�according to the National Association of Realtors. The index rose from 99.3 in June to 101.7 in July, far above the consensus, and from July 2011, the index is up by 12.4 percent. Pending Home Sales Index and the Housing Market Some other details in NAR’s report included: �Regionally, the South ...
NAR’s Pending Home Sales Index Hits Highest Level in Two Years in July was originally published on Chicago Agent Magazine - For the well-informed real estate professional, the leading source for news and perspective for real estate professionals in the Chicagoland area.
Source: http://feedproxy.google.com/~r/chicagoagentmagazine/news/~3/sA9FEjbwyqU/
American Heritage: Nina Simone?s Childhood Home Comes With Legacy
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/oqfU1GUvnR4/
Report: Selena Gomez Buys Jonah Hill?s Home
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/2Iabb52q9-M/
Florida Mortgage Update for the Week of June 18, 2012
Related posts:
- Florida Mortgage Update for the Week of June 11, 2012 Mortgage markets worsened last week, breaking a multi-week winning streak...
- Florida Mortgage Update for the Week of March 12, 2012 Mortgage markets were mostly unchanged last week despite a series...
- Florida Mortgage Update for the Week of October 31, 2011 Mortgage markets moved across a wide range last week before,...
Rates Edge Higher Despite Renewed Jobs Woes
Two Dogs Southwest Gallery
Source: http://www.ThompsonGroupAZ.com/two-dogs-southwest-gallery/
Trials and Tribulations of Buying and Selling in NYC
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/cq3iL2hlRyY/
Fed mulls open season on bond buys to help economy
Source: http://feeds.reuters.com/~r/news/economy/~3/Ke26apJ08m4/us-usa-fed-stimulus-idUSBRE87P03820120826
Tuesday, August 28, 2012
News Affecting Mortgage Interest Rates 01/24/11
Source: http://www.homemortgagenewsblog.net/news-affecting-mortgage-interest-rates-012411.html
Chicago Home Prices Rise 4.6 Percent in June Case-Shiller
Chicago Home Prices Rise 4.6 Percent in June Case-Shiller was originally published on Chicago Agent Magazine, the leading source for news and perspective for real estate professionals in the Chicagoland area.
For the second month in a row, Chicago home prices rose strongly in the�Case-Shiller Home Price Indices from Standard & Poor’s, rising�4.6 percent from May to June. Chicago was the talk of the real estate community last month, when its monthly appreciation from April to May of 4.5 percent was the best of all 20 metropolitan areas surveyed by S&P; and indeed, in the latest Case-Shiller, only Detroit and Minneapolis posted higher monthly price gains. June Case-Shiller Home Price Indices Nationally, the news was similarly promising: All three composites of the Case-Shiller ended 2012′s ...
Chicago Home Prices Rise 4.6 Percent in June Case-Shiller was originally published on Chicago Agent Magazine - For the well-informed real estate professional, the leading source for news and perspective for real estate professionals in the Chicagoland area.
Source: http://feedproxy.google.com/~r/chicagoagentmagazine/news/~3/dlLGbiO-zqs/
3 Great Instagram Tips for Real Estate Agents
3 Great Instagram Tips for Real Estate Agents was originally published on Chicago Agent Magazine, the leading source for news and perspective for real estate professionals in the Chicagoland area.
By Peter Ricci Instagram, the free photo-sharing social network that allows users to snap photographs with their mobile devices and share them with fellow Instagram users, is the latest darling on the technological scene, and naturally, users are beginning to explore how its technology can be applied to other, interesting fields. And as users experiment, we have begun to wonder, is Instagram and real estate a compatible pair? Instagram and Real Estate ? The New Frontier The answer to that question, no doubt, is an emphatic YES, and we’ve got three reasons you should ...
3 Great Instagram Tips for Real Estate Agents was originally published on Chicago Agent Magazine - For the well-informed real estate professional, the leading source for news and perspective for real estate professionals in the Chicagoland area.
Source: http://feedproxy.google.com/~r/chicagoagentmagazine/news/~3/Zb0iMwtmFY8/
Chicago Illinois Mortgage Rates Week in Review for the Week Ending 07/06/2012
Best to Even Better!
Source: http://www.totalmortgage.com/blog/current-mortgage-rates/best-to-even-better/17693
Chicago Invests in Those Who Need It Most
Source: http://www.chicagolandrealestateforum.com/2012/08/28/chicago-invests-in-those-who-need-it-most/
Chicago Eminent Domain Update; "When" Not "If" for Buybacks; CFPB Servicing Proposal Info and Undercover Sleuth Program Hiring
Yesterday afternoon, per the Census Bureau, the U.S. population reached a milestone that is very meaningful to mathematicians: 314,159,265 residents, or pi (3.14159265) times 100 million. Pi is a mathematical constant that is the ratio of a circle's circumference to its diameter. "This is a once in many generations event...so go out and celebrate this American pi," said Census Bureau Chief Demographer Howard Hogan. The securitization industry had a little something to celebrate yesterday, and that was Chicago Mayor Rahm Emanuel's position on eminent domain.
In the story above is a brief explanation on how Mortgage Resolution Partners stands to profit from their efforts. A note I received yesterday observed, "This excerpt from the Mortgage Resolution Partners website says a lot: 'Implementation of the CARES program by local governments acts as a catalyst for similar programs in other communities and for broader policy changes, helping to alleviate the US mortgage crisis.' Maybe attorneys and special interest groups could alleviate all mortgages - that would end the crisis."
A quick clarification. Yesterday's banter about Realtors and LO's contained a link to NAR's regulatory efforts. But as many folks pointed out, that link isn't redirecting correctly since it's going to an internal, "member section" of NAR's site. Here is the appropriate link to see what the organization has been up to.
And anyone who thinks that buybacks issues are behind us had better think twice. "Fannie & Freddie Continuing to Clamp Down on Banks" is the trend, and trust me, given that banks are not likely to absorb all this by themselves, these putbacks will be pushed down into smaller originators. More
I was reading in the paper today about this dwarf that got pick-pocketed. How could anyone stoop so low? Many in the industry are accusing the CFPB of stooping low by advertising that it wants employees to go "undercover", a la secret shoppers, to nab banks. Use the code name "George Orwell." Here is the complete story.
Many in the industry are concerned about the CFPB's proposed mortgage servicing rules. The proposals consist of a 250-page Real Estate Settlement Procedures Act (Regulation X) rule and a 178-page Truth in Lending Act (Regulation Z) rule. Comments on the proposals will be due by October 9; implementation is expected to be issued by January. While the proposals' page count may seem modest compared to the CFPB's nearly 1,100 page proposal integrating RESPA/TILA disclosures, the servicing proposals are untypically single-spaced rather than double-spaced.
In addition to the proposals, the CFPB also released a report titled "Summary of Proposed Mortgage Servicing Rules." The report summarizes the study used by the CFPB to inform its development and testing of the model disclosures that were published with the proposed rules.
There is a short, readable write up of its implications at stratmorgroup.com, click on the link in the top right corner. Note that both Fitch Ratings and the MBA have reacted to the CFPB's proposed rules for mortgage servicers. Fitch said that in general it views the proposed rules positively because, if implemented, they would set consistent standards for all servicers, including smaller nonbank entities "that have thus far avoided the mandated changes." Fitch, however, warned that the rules, like other servicing focused initiatives, will further increase compliance costs.
Lawsuits are a part of the biz, and former Fannie CEO Daniel Mudd must face a lawsuit in which the U.S. Securities and Exchange Commission accuses him of misleading investors about the company's exposure to risky loans.
Let's move on to some relatively recent agency, investor, and vendor updates. They just don't stop - I don't know how underwriters keep track of them! For full details it is best to read the full bulletin, but these will give you a flavor for what is going on.
As part of the revision of policies on continuance of income verification, Fannie Mae has added guidelines about evaluating variable income (hourly pay, overtime, bonuses, commission) to address history of receipt, frequency of payment, and income trending. Clarification has been issued regarding types of income that require the lender to verify a three-year continuance and income sources that have a defined expiration date or that are based on the depletion of an asset. Lenders are now required to supply federal income tax returns to confirm income from temporary or periodic employment, interest and dividends, and any business in which the borrower has a stake of at least 25%.
Fannie will be adjusting the required interest rate for standard modifications with a pre-modification mark-to-market LTV ratio of 80% or more. This rate is required to be implemented for standard modifications with Trial Period plans that go into effect on or after September 1, 2012, though servicers are encouraged to do so for Trial Period plans that go into effect on or after August 1st.
HUD has made a few changes to the TOTAL Scorecard, the new version of which should be used for all first-time risk assessments after July 21st. Any applications that were scored with a case number under the previous edition of the Scorecard will be eligible to be re-scored under the previous edition for 90 days, after which they will be subject to the new one. The revisions include the addition of review rules and error codes and the changing of some optional data fields to required data fields; the full details of the changes may be viewed here.
As the FHA prepares to update the process used to remit MI premiums for the Home Equity Conversion Mortgage program, it is requiring all FHA-approved mortgagees currently responsible for remitting MI premiums but not involved with the Home Equity Reverse Mortgage Information Technology project to submit certain information by July 25th. The company name; 10-digit FHA Mortgagee ID number; name and title of the company representatives who oversee HECM origination, servicing, and claims; and the phone numbers and email addresses of each company representative should be emailed to HERMITUAM@hud .gov.
Most everyone knows that the Disputed Credit and Identity of Interest sections of FHA Mortgagee Letter 2012-10, which were scheduled to become effective on July 1st, have been rescinded. The guidance on Year-to-Date P&L and Balance Sheets and Identity of Interest remains in effect for all case numbers assigned on or after April 1, 2012.
Flagstar has issued additional guidance following its earlier announcement that any FHA Streamline refinances registered on or after July 6th where Flagstar wasn't the original loan's servicer would be subject to a requirement of a FICO score of at least 680 and a loan level pricing adjustment. Loans that were underwritten by Flagstar, registered on or before July 5th, and currently floating are exempt from the new conditions provided that they are funded and disbursed by July 31st, while locked loans remain exempt if they're funded and disbursed by July 31st or the lock expiration date, whichever is later. Such loans will not be granted lock extensions and will be re-priced if the deadlines are not met. Similar guidelines apply to floating FHA DE Delegated Correspondent loans, which, given that they were registered before July 5th and meet the July 31st deadline for delivery, are excepted. FHA DE Delegated Correspondent loans that have already locked should be delivered by the later of July 31st or within five business days of the lock expiring to remain exempt.
The Fannie DU Refi Plus II program at Flagstar has been updated such that it is now divided into "Fannie Mae DU Refi Plus II-Same Servicer" and "Fannie Mae DU Refi Plus II-Other Servicer," which represent two separate sets of products. The eligibility requirements for the former remain unchanged; however, guidelines for the latter have been amended. Loans under "Fannie Mae DU Refi Plus II-Other Servicer" will be subject to their own set of LTV and FICO score guidelines depending on the property type, a DTI limit of 40%, and a requirement of a minimum of six months' verified reserves, for which all large deposits much be accounted. Any loans that receive an "Expanded Approval" response require a DU Property Fieldwork Waiver, without which they are not eligible. With regards to pricing, loans under the "Other Servicer" program that have EA risk classes are subject to updated EA price adjustments, while the EA adjustment for "Same Servicer" products remains at -0.25 for all EA levels. Loans currently in the pipeline under the existing Fannie Mae DU Refi Plus II program need to be locked on or before July 26th; failure to do so will require the loan to be switched to one of the new products.
With regards to loans initially targeted to Wells Fargo, Flagstar has announced that it will accept such loans provided that they fit within the current guidelines. AIR compliant appraisals from Wells will be accepted so long as they are accompanied by an AIR compliance certificate and a lender letter from Wells. Appraisals completed by an appraiser on the Flagstar Ineligible Appraiser list will require a new appraisal to be ordered.
As per the recently issued FHA regulation, Flagstar will no longer purchase any transaction where the property is encumbered by private transfer fee covenants. This applies to pipeline loans and new registrations both.
Genworth's US Mortgage Insurance division has integrated a new "Quick Submit" option into its customer-facing website that allows users to submit full-service loan packages and receive an MI coverage decision with increased ease. Much of the redundant data entry required under the old interface is no longer necessary, and contract underwriting, HARP, and "doc-only" full-package loans can all be submitted under a single username and password. Users are also able to track the status of loans they submit.
Yesterday the fixed income (bond) market reacted to the strong Retail Sales stats - is the U.S. economy really picking up steam? Perhaps - certainly property values aren't plunging, the job market is not desperate, and many government statistics point to areas of improvement. But both stocks and bonds sank in price, so not everyone is convinced. And as we know, low rates can only help mortgage applications for so long ("refi fatigue"), and the MBA's survey reported that last week's home loan applications dropped 4.5%. The refinance index decreased 5% from the previous week, and purchases were down 2%. Refi's are still strong: 81% of total apps, much of that from banks. (ARM's are still down around 4%.) The average conforming rate was 3.76% and the average jumbo rate was 4.03% - so there you go: .25% difference. (The vast majority of jumbo loans are sitting in bank portfolios - and why not given those rates?)
This morning risk-free Treasury prices are pointing lower again today to a nearly three month high in yield on the 10-yr at 1.76% (it hit 1.79% in London overnight). But stocks are pointing lower - wassup with that? The smartest minds in the room seem to think that the US economy is growing enough for the Federal Reserve to avoid further stimulus measures, but not enough to really help companies (and therefore stock prices). Of course this outlook could, and will, change. For concrete news, we had the Consumer Price Index this morning. Expected at +.2% for July, it was unchanged, with the core rate only up .1% - both more moderate than expected. The Empire Manufacturing Index was down 5.85. In the early going the 10-yr is around 1.77%, and agency MBS prices are worse about .250.
(Parental discretion advised!)
Here are some rumored "top" comments made by sports commentators during Summer Olympics...
Source: http://www.mortgagenewsdaily.com/channels/pipelinepress/08152012-pi-cfpb-sleuth-program-rahm.aspx
Florida Mortgage Update for the Week of July 2, 2012
Related posts:
- Florida Mortgage Update for the Week of May 21, 2012 Mortgage rates fell to a new all-time low last week....
- Florida Mortgage Update for the Week of June 18, 2012 Mortgage markets improved last week, sending mortgage rates lower....
- Florida Mortgage Update for the Week Of May 29, 2012 Mortgage markets worsened slightly last week as demand for mortgage-backed...
Fewer home buyers are first-timers
Source: http://stlhba.hbablog.com/2012/08/27/fewer-home-buyers-are-first-timers/
Basel III Comment Period Extended; CFPB Servicing Guideline Proposals; LO Realtor Thoughts
"Wanna tell you a story, about the house-man blues.
I come home one Friday, had to tell the landlady I'd-a lost my job.
She said that don't confront me, long as I get my money next Friday.
Now next Friday come I didn't get the rent, and out the door I went!"
CitiGroup is hoping it never hears that refrain written by Delaware's George Thorogood. The bank rolled out a program where eligible delinquent homeowners can rent back their home if they agree to keep rent current and sign over the deed in lieu of foreclosure proceedings. "Citigroup's program would extend to as many as 500 families who owe more on their mortgages than their home is worth, are more than 120 days past due but can afford rent at current market rates." (Critics say it sounds like a drop in the bucket - 10 in each state - and more of a PR move, but what do they know?) Here are a few more details: http://www.insidermonkey.com/blog/citigroup-inc-nysec-starts-program-to-help-distressed-homeowners-16280/.
Jersey Shore fraud with the names of Citi and Wells mixed up in it? Who can make this stuff up? Not me: http://www.businessweek.com/news/2012-08-09/10-charged-with-40-million-jerset-shore-mortgage-fraud.
I see the Aussies aren't doing very well in the Olympics. But then, if they could run, they wouldn't have been Australians in the first place... The U.S. Post Office isn't doing very well either, but I don't hear anyone calling for it to be abolished. Maybe F&F should hire the USPS's PR firm. The U.S. Postal Service lost $5.2 billion in its third quarter ended June 30, in large part, the agency said, because of a 2006 law requiring it to prefund future retirees' health benefits, amounting to a $5 billion payment each year for 10 years. The New York Times reports that the agency so far has lost $11.6 billion in this fiscal year, which ends Sept. 30.
When it comes to Basel III, which many in our industry view as having a worse impact than QM or even QRM, nothing is simple. Its regulations were approved by the Federal Reserve in June, with a public comment period opened. This week the FDIC extended the comment period until October 22 on three notices of proposed rulemaking (NPRs) that would revise and replace the agencies' current capital rules. The proposals have been available on the Federal Deposit Insurance Corporation's website since June 12 (http://www.fdic.gov/).
The Basel accord, which is to be phased in from 2013 through 2019, will require banks to maintain top-quality capital equivalent to 7 percent of their risk-bearing assets, about three times what they are required to hold under existing rules. And mortgage servicing rights that can't exceed 10% of Tier 1 capital, impacting every depository lender that owns, and originates, servicing. On top of that, however, 28 global "systemic" banks may have to hold up to an additional 2.5 percent buffer. It is up to each country to write rules to implement the Basel agreement for its banks. U.S. banks have pushed regulators to allow them to count more heavily mortgage servicing rights and the unrealized gains and losses of certain securities toward their capital requirements than allowed by Basel III, but the Fed's draft rule closely follows the international agreement.
Breaking it down, one NPR, the Basel III regulatory capital reforms, would strengthen minimum requirements for the level and quality of financial institutions' capital. On the surface, this is a fine goal - but the impact on banks would be to tie up more capital when they want to hold mortgages in their investment portfolios - and how does this jive with the government wanting banks to loan out more money? The second NPR proposes changes to the agencies' Advanced Approaches capital regulation to reflect other aspects of Basel III and would apply the agencies' Market Risk capital regulations to thrift institutions and thrift holding companies. A third NPR, the Standardized Approach, proposes changes to the calculation of risk-weighted assets that address issues identified in the financial crisis, and removes reliance on credit ratings consistent with the Dodd-Frank Wall Street Reform and Consumer Protection Act. And here is one person's views on Basel III which echo many in the industry's: http://camfine.wordpress.com/2012/07/24/by-god-that-is-enough-it-is-time-to-stop-the-madness/.
This extension of the comment period for Basel III is important. Maybe reason will prevail? The proposals in Basel III, and approved by the Federal Reserve, largely reject pleas by the U.S. banking industry to soften parts of the new standards. They would force banks to rely more on equity than debt to fund themselves so that they are able to better withstand significant losses. The announcement came a day after a group of state banking organizations asked the Fed and the other U.S. banking regulatory agencies for an extension. But a bipartisan pair of senators has called on the Fed to impose even tougher standards on the largest banks. "The surcharge on the mega banks should be high enough that it will either incent them to become smaller or help to ensure they can weather the next crisis without another taxpayer bailout," Democrat Sherrod Brown and Republican David Vitter wrote in a letter to Fed Chairman Ben Bernanke. And they have some public support, given the news this year on Chase's multibillion dollar hedge loss, and the apparent manipulation of the London Interbank Offered Rate (LIBOR).
While we're talking about banks, the OCC released an update to its Bank Accounting Advisory series that includes clarification on accounting for acquired loans, OREO, TDRs, nonaccruals, ALLL, insurance claims and other hot topics. The Advisory, and others, can be found here: http://www.occ.gov/news-issuances/index-news-issuances.html.
The CFPB announced another public comment period, this time for proposals directed at servicers "...aimed at protecting homeowners from unexpected costs and shoddy service by companies that collect their monthly mortgage payments. Mortgage servicing companies would be required to provide clear monthly billing statements, warn borrowers before interest rate hikes and actively help them avoid foreclosure under the proposal by the Consumer Financial Protection Bureau. The rules also require companies to credit people's payments promptly, swiftly correct errors and keep better internal records."
Once again, who can disagree with the publicly stated mission? But the devil is in the details. Here is a more in-depth write up of the recent developments: http://www.marketwatch.com/story/new-rules-aim-to-lessen-mortgage-complaints-2012-08-10. And to comment on this or any other CFPB proposal, visit http://www.consumerfinance.gov/notice-and-comment/.
Speaking of comments, earlier this week, the commentary noted the money spent by NAR, leading to some comments by a Realtor noted yesterday. I don't relish being in the middle of a water balloon fight, especially between two groups that need each other like lenders and Realtors, but a few originators wrote back. "Realtors don't take on any buy back risk from Broker/Correspondent agreements where the risk lasts for years, Early Pay Off fees that take more than you made on a file (both that vary risk costs with the size of the loan file), knowing you'll work 3-5 times harder on some loans than others due to structure and program, employee/staff payroll costs that have increased dramatically the last five years to stay in compliance with new regulations, hours of answering emails and calls of scenarios while the borrowers second guess everything you tell them these days after you first do hours of research on minute technical guidelines at 2-3 levels of overlays that could trip up the file at close if you miss it. Solving problems for hours with more research as the file adjusts with appraisals and/or changes from the Realtors after a home inspection. I pay for all of my personal marketing expenses that have run well into five figures annually to get leads and many lunches for Realtors I drive to. I agree with Linda J from Florida, but any LO could come up with a very similar list about why every loan is unique, probably longer than mine, and it made no difference to the Feds in 04/01/11 and may not now to CFPB coming in January. Realtors would do better to join the mortgage industry in trying to stop this Federal overreach rather than in saying their job is harder/different so should be exempt from regulation on costs to consumers. It didn't work for us."
And, "For originators, every item of personal time and money Linda itemized is replicated on mortgage side of the transaction and then expanded for 60+ days - its business. What isn't reflected is the 11PM calls from frantic borrowers who were told by the realtor they could close in 30-45 days and terminated the rent, the borrower who was "advised" to waive the mortgage contingency because "this town is hot right now", or the Realtor who tell you she/he scheduled the closing for the day after tomorrow and you're still tracking asset documents. This is business. The entire 19% of GDP that the real estate sector covers is under attack. In the past 2 months I have given talks about regulatory issues and their effects on the industry to 4 groups of about 350 Realtors total. I would estimate less than 10 had ever heard of half the items I presented such as the Flat Fee proposal nor the proposals requiring the inclusion of Realtors fees in the Flat Fee. In the past year I have received only 1 item from NAR about regulatory issues. Unfortunately the regulators and borrowers only see the commission checks paid to broker and Realtors and not the massive work load, regulatory expenses and human stress behind the check. What the Regulators seem to miss is intellectual property rights of the MLO. Yes, you should get what you pay for."
Turning to the markets, on Thursday the 10-yr closed at 1.69%. Rates certainly wouldn't have improved given the results of the 30-yr Treasury bond auction - they were poor. However, at least the auctions are over, and the 10-yr, which hit a high of 1.73%, improved somewhat, and seems to be doing so again in the early going today. Over on the agency MBS screens, current coupon prices were worse about .250 at one point but then buyers stepped in and voila! Prices improved, and MBS rallied back - there didn't seem to be enough market moves to warrant price changes by the majority of investors.
Today's calendar is relatively sparse again, as it has been several times this week, with just Import Prices for July (predicted slightly higher). This is not a market-moving number, and given the waning days of summer vacation for many, folks heading for the doors early may represent the majority of movement later in the day. In the very early going the 10-yr yield is down to 1.64% and MBS prices are better .125-.250.
Things we know because of TV! (Part 2 of 3.)
- When paying for a taxi, never look at your money. Just pull out a bill or two and hand it over. It will always be the exact fare.
- If a killer is lurking in your house, it's easy to find him. Just relax and run a bath even if it's the middle of the afternoon.
- All single women have a cat.
- Even when driving down a perfectly straight road, it is necessary to turn the steering wheel vigorously from left to right every few moments.
- It does not matter if you are heavily outnumbered in a martial arts fight. Your enemies will wait patiently to attack you one by one.
- When you turn out the light to go to bed, everything in your room will still be clearly visible, just slightly bluish.
- Dogs always know who is bad and will naturally bark at them.
Source: http://www.mortgagenewsdaily.com/channels/pipelinepress/08102012-cfpb-george-thorogood.aspx
Monday Morning
Source: http://stlhba.hbablog.com/2012/08/27/monday-morning/
Current Mortgage Rates for Wednesday, July 18, 2012
Monday, August 27, 2012
UPDATE 2-Australia's Graincorp in $490 mln edible oil deal
handler GrainCorp said on Tuesday it plans to buy two
food oil businesses for a combined A$472 million ($490 million)
to create the...
Mortgage Pre-Approval is Still Worth Getting
Source: http://news.mortgagecalculator.org/mortgage-pre-approval-is-still-worth-getting/
China iron, coal defaults not all they seem: Clyde Russell
Famous Chicago Real Estate Hits the Market
Source: http://www.chicagolandrealestateforum.com/2012/08/26/famous-chicago-real-estate-hits-the-market/
Thoughts on the Broker Business Model and Current Compensation; Wells' New HARP Policy
Well, this is the week that many Secondary Marketing folks have been dreading. It is the last week of the month after a sell-off, and there are plenty of LO's who are sweating those refi's closing on time. Extension policies will be sent out, or pointed to on websites, and bickered over. Not only that, but the upcoming weekend is a 3-day weekend. Look for operations to be partially staffed as folks take some summer vacation time or head off at the end of the week.
Here is a job a little off the beaten path. Advantage Credit Inc. is looking for a Sales Director for the Northern California region. Check out the firm's website for more information (advcredit.com), but the 20 year old national mortgage credit reporting agency, with a reputation for sharing knowledge and providing old fashioned customer service, continues to grow and expand nationally. The Regional Sales Director will be responsible for developing new customers in the mortgage financial market and acting as the customer's credit consultant and helping them grow their business. Candidates should send their resumes to Jim Kaiser at jim@advcredit .com.
And Opes Advisors, Inc. is currently seeking an internal Sales Support Representative to provide loan scenario support for the sales department. Opes Advisors, an independently owned mortgage banking and investment management firm south of San Francisco, seems to be growing by leaps and bounds. And it isn't like scenarios are becoming easier, so this role is critical! The role fields loan scenario questions, researches answers when issues arise, and responds to various situations as they occur from the production staff. And the person has to do things that I could never do: learn the specific guidelines for the product offerings of the mortgage banking division - become the "go to" expert in each of the products, offer 24 hour turnaround time for loan scenario questions, guide mortgage advisors, review credit reports, AUS findings etc. - a jack of all trades and a good entry into a good company. Confidential inquiries and resumes should be sent to resumes@opesadvisors .com.
And yes, I've taken to putting out commentaries on many Saturdays. But for most folks, Saturday is a day off - except possibly in the future under the CFPB's proposals. Attorney Brian Levy observed, "Buckley Sandler's summary of the new RESPA TILA proposed regulation and I was shocked to see that the CFPB intends to regulate Saturday right out of the mortgage business' weekend. 'Business day' is any calendar day except a Sunday or a legal public holiday (New Year's, Martin Luther King Day, Washington's Birthday, Memorial Day, Independence Day, Labor Day, Columbus Day, Veterans Day, Thanksgiving Day, and Christmas day). This is a change from Regulation X's current definition of 'business day,' which is 'a day on which the offices of the business entity are open to the public for carrying on substantially all of the business entity's functions.'" And what is the definition of an "application?" See this all in a portion of BuckleySandler's well written summary of the new CFPB Rule combining TILA & RESPA disclosures: stratmorgroup.com.
"Rob, is the broker business model dead? Many of the companies we sell to seem to be being squeezed. The agencies will probably cap sales volumes based on net worth due to counterparty risk. (I recently received this note: I attended a conference where Fannie indicated that newly approved sellers would be subject to a 20x net worth ANNUAL sales cap to Fannie. They were also looking at how they were going to apply this methodology/philosophy to existing sellers. Further discussions indicated there may be "some" flexibility in the 20x number... they had to start somewhere... but the message is clear that they are moving down the path of managing perceived counterparty risk through sales caps.) Servicing is going to non-depositories due to Basel III, investors have either exited wholesale or standardized their pricing, etc."
Nah, I don't think it's dead. I am not going to make a definitive list here, because every time I make a list it excludes someone. But suffice it to say plenty of firms have stepped into the wholesale business channel void left by BofA, Wells, ING, MetLife, and others. These easily come to mind without even thinking: JMAC, Fairway Independent, First Mortgage, Stearns, BofI, Maverick, Icon Residential, Sierra Pacific, MSI, Norcom, Pinnacle, Provident, Flagstar, FAMC, Kinecta, HomeStreet, Cole Taylor, REMN, 360 Mortgage, WCS, Stonegate, Parkside, Towne, USA Direct, Norcom, and so on. (Your best bet for a complete list is to consult the Scotsman Guide, or National Mortgage News.)
There is no doubt that the broker channel has gone through unprecedented change. Companies have exited the business. Others have increased their minimum net worth requirements, file documentation requirements, counterparty review process, and/or fixed their compensation structures. But Wells pulling out was greeted with plenty of firms going after its market share. (At $2-3 billion per month, divided among 30-40 wholesalers, the volume is welcomed, and many of those companies turn around and sell the loans to Wells anyway through the correspondent channel. But if you're Wells, would you rather deal with monitoring - and held liable by the DOJ - one counterparty who sells you $100 million per month or twenty counterparties selling you $5 million each?) Proponents of the broker model believe that it is a cost effective way for lenders to have their product seen by more potential borrowers, and that those borrowers have more lender options by using a broker (lender, price, lock period, and so on). It is indeed an easy argument to say that the quality of the final loan product is a result of the income, credit, appraisal, borrower, and originator, rather than the channel through which it funds.
It seems to be a secret that lenders' margins are higher than they've ever been due indirectly, or directly, to the increased compliance and regulatory burdens. Who in their right mind would want to start a mortgage company when the first group you'd hire is the compliance team rather than loan officers? There is a lot of complaining about governmental involvement in the financial & lending system, which is justified. And certainly no regulator or government official can complain about "too big to fail" or "too much market share" when all of the hurdles they've put in place have the "unintended consequence" of limiting competition and bolstering margins at the expense of the consumer. LO's who say, "Why hasn't a Realtor's commission come under more scrutiny." First, it is transparent. But the problem is that the mortgage community is over-regulated, not that the Realtor community is under-regulated. Just because Realtors have better lobbyists, don't begrudge them. This is still a free country, if 5-6% commissions in a less regulated business sound attractive, join 'em. The barriers of entry remain low for Realtors.
Last week the commentary repeated a note from a broker/banker saying, "Loan officers across the board have set their margins higher than pre-LO comp to ensure never making too little." I received this note: "This is happening, of course, because current lender-favorable market conditions allow such pricing latitude. When the inevitable return to 'normalcy' occurs and pricing again becomes more competitive, LO's will no longer be able to price at will. The industry is enjoying an origination bull market which tends to distort behaviors, but we should not fall into the trap of seeing this as the new normal in mortgage banking."
Dick L., and industry vet from San Francisco, wrote, "CFPB director Richard Corday told Congress this past January that he believes it is 'probably not useful' to try to define in advance what an 'abusive' lending practice is. Instead, he intends to use his enforcement powers to retroactively punish lenders based on his view of the "facts and circumstances" of each case. To me, this is Alice in Wonderland insane. The attitude is 'We are not going to tell you what the rules are but once we decide what they are we reserve the right to hold you retroactively responsible.' The CFPB has reviewed some large mortgage lenders and will soon let them knew what unspecified rules they broke, if any. The irony is that one of the authors of Dodd-Frank (Barney Frank) defended the unsafe HUD mandated subprime lending practices of FNMA and FHLMC...In the Wonderland that is Washington we had government mandated subprime from FNMA, a defense of this when questioned, an enormous hit to the economy when this explodes, blame placed on the lenders who made the mandated subprime loans and a new set of not-yet-ready-for-definition rules to punish the miscreants for past violations of future rules. The situation created by Dodd-Frank is close to worst case. The regulating entities CFPB and the Financial Stability Oversight Council have unchecked power. That dog don't hunt. To be clear, I am by no means suggesting that government mandated subprime was the only factor to cause the mortgage mess. It was however the single most important factor in the destruction of FNMA and FHLMC. The government did not mandate the unsafe and unwise practices of entities such as Washington Mutual. People have been asking, 'Why aren't lenders lending?' A better question might be 'Why, faced with possible penalties from an unchecked entity which can make up tomorrow rules which applied yesterday, is anyone lending at all?'"
HARP received another blow Friday, this time by Wells Fargo's correspondent group. "Consistent with our decision to only purchase FHA Streamline Refinances of Wells Fargo serviced Loans, Wells Fargo Funding will begin purchasing only DU Refi Plus refinances of Wells Fargo serviced Loans...Wells Fargo will continue to purchase DU Refi Plus refinances of Wells Fargo serviced Loans. This policy change also applies to our retail origination channel. Note: Loans serviced by America's Servicing Company, a subsidiary of Wells Fargo, are not considered Wells Fargo serviced Loans." It takes effect on 9/24 for best efforts locks, on for mandatory: "The policy change outlined above is effective with Loans assigned to a Mandatory Commitment on and after November 13, 2012. DU Refi Plus refinances of non-Wells Fargo serviced Loans must be received and assigned to a Mandatory Commitment by Wells Fargo on or before November 9, 2012, and must be purchased on or before November 30, 2012."
In a quick bit of M&A news, Hudson City Bancorp (135 branches) is being purchased by M&T Bank for $3.7 billion.
Well, what do we have going this week besides LO's pushing and shoving to try to have their refi's close on time? Zippo today. Tomorrow we have another housing index (Case-Shiller 20-city index with its two month lag) and Consumer Confidence. Wednesday is the second stab at Q2 GDP and another housing index (Pending Home Sales). That afternoon is the Fed's Beige Book. Thursday is Jobless Claims, Personal Income and Consumption and the PCE Price Index. Friday is the Chicago PMI, Michigan Consumer Sentiment, and Factory Orders. In the early going the 10-yr yield, which closed Friday at 1.68%, is now at 1.67%, and MBS prices are nearly unchanged.
(Parental discretion advised, although somewhat edited. And no, this is unfortunately a myth.)
When Apollo Mission Astronaut Neil Armstrong first walked on the moon, he not only gave his famous "one small step for man, one giant leap for mankind" statement but followed it by several remarks, usual com traffic between him, the other astronauts and Mission Control. Just before he re-entered the lander, however, he made the enigmatic remark "Good luck, Mr. Gorsky." Many people at NASA thought it was a casual remark concerning some rival Soviet Cosmonaut. However, upon checking, there was no Gorsky in either the Russian or American space programs. Over the years many people questioned Armstrong as to what the "Good luck, Mr. Gorsky" statement meant, but Armstrong always just smiled.
On July 5, 1995 (in Tampa Bay, FL) while answering questions following a speech, a reporter brought up the 26-year-old question to Armstrong. This time he finally responded. Mr. Gorsky had finally died and so Neil Armstrong felt he could answer the question.
When he was a kid, he was playing baseball with a friend in the backyard. His friend hit a fly ball which landed in the front of his neighbor's bedroom windows. His neighbors were Mr. & Mrs. Gorsky.
As he leaned down to pick up the ball, young Armstrong heard Mrs. Gorsky shouting at Mr. Gorsky, "Sex! You want sex?! You'll get sex when the kid next door walks on the moon!"
Source: http://www.mortgagenewsdaily.com/channels/pipelinepress/08272012-jobs-hudson-city-bancorp.aspx
In Missouri, Debtors? Prison Is Alive and Well
Debtors’ prisons may be illegal under the Missouri state constitution, but the practice of locking people up for unpaid debts ...Source: http://www.credit.com/blog/2012/08/in-missouri-debtors-prison-is-alive-and-well/
Rates Edge Higher Despite Renewed Jobs Woes
TEXT-S&P ratings - STMicroelectronics N.V.
Source: http://feeds.reuters.com/~r/reuters/financialsNews/~3/_ravQH-q7aQ/idUSWLA235620120827