When consumers seek a line of credit, they may be fairly confident that they know where they stand with regard ...
Sunday, September 30, 2012
20% of Consumers Get Different Credit Scores Than Lenders
When consumers seek a line of credit, they may be fairly confident that they know where they stand with regard ...
Consumers: Credit Scores Shouldn?t Inflate My Insurance Costs
Many Americans consider it more than fair for institutions that issue consumer loans orcredit cards to use their credit rating ...
Freddie and Fannie Can Earn a Profit, Right? And their Double-secret "High Risk" Watch List of 300 lenders
"Rob, I'm a new LO in Connecticut. What's the scoop on this news about loans in my state being more expensive than others for home loans?" Under the FHFA's proposal, Fannie & Freddie would hike fees between 15 and 30 basis points on lenders in Connecticut, Florida, Illinois, New Jersey, and New York. During a foreclosure those states apparently have considerably longer time frames to obtain marketable title than the national average as well as costs that range between 9 and 18 percentage points above the national average.
State specific pricing, especially for aggregator's servicing released premiums, have been around a long time. (In fact, it is not hard to remember the days when newspapers would publish the average rates in different areas of the U.S., rather than a national average.) And it is no secret that the agencies are out to make profits, just like the rest of the industry, and rumored that many segments of their businesses have a goal to be self-sufficient in case they're eventually peeled off. Here is the link to FHFA press release. And here is the link to the actual notice.
But don't stop there! The FHFA's report on the "High Risk" Watch List at Freddie and Fannie is worth a gander. The report made a case study out of TBW, but provides information about how to stay off the list (wherever the list is - ask your rep). Go to http://www.fhfaoig.gov/ and look under "Current Activities" for "FHFA's Oversight of the Enterprises' Management of High-Risk Seller/Servicers".
Recently Edward DeMarco, Acting Director of the Federal Housing Finance Agency (FHFA) and thought to be a good guy by most accounts with whom I've spoken, sketched in a broad outline of the agency's vision for the future of the mortgage finance markets in the coming years. That future, of course, may or may not include Fannie or Freddie. It seems that the FHFA has three goals for its conservatorship: build a new infrastructure for the secondary mortgage market, gradually contract the GSEs' dominant presence in the marketplace while simplifying and shrinking their operations, and maintain foreclosure prevention activities and credit availability for both new and refinanced mortgages.
Any lender issuing Fannie securities is quick to notice that a new securitization platform for the secondary market is a key to this vision, but will also notice that a single, common securitization platform is not the same as a single security. The FHFA plans that this platform would be a utility that would outlast the GSE's. DeMarco said he strongly believes in competitive markets and, as a utility, the platform should enhance liquidity, standardization, and transparency, all of which should foster that competition. Whatever the structure of the secondary market of the future, certain key functions will need to be performed and in many cases, like developing data reporting standards, the standardization of such functions will benefit the overall market.
And taking an even further step back, the last FHFA semi-annual report to Congress included a section detailing, in financial terms, the fall of Freddie and Fannie. Are we being reminded that anyone who doesn't know history is doomed to repeat it? The GSEs' mission was to provide liquidity to the housing finance system. They did this primarily by supporting the secondary mortgage market through the purchase of residential mortgages from originators who then used the proceeds to originate more loans, either holding the mortgages in investment portfolios or packaging them into mortgage-backed securities (MBS). These MBS were then sold to investors, and with a fee, the GSEs guaranteed the performance of the MBS they sold. The operations were financed through MBS sales and through funds borrowed from large individual, institutional, and foreign investors. The GSEs hold they maintained special accounts or reserves to which they made regular contributions called provisions for loan losses, as there will inevitably be defaults from some homebuyers. The fees they charged for their guarantees were intended to cover the small subset of loans that were expected to default and reserves were established for those losses - see where the gfees come in?
Upon default, loan servicers may commence foreclosure and take possession of the collateral property. Upon completion of this process, the GSE erases or charges off the unpaid mortgage balance, debiting the corresponding loss reserves. If the collateral property is subsequently sold the proceeds will offset losses. When the housing market collapsed, losses on loans and guarantees vastly exceeded that loss-covering capacity. The GSEs had grown rapidly with only a thin capital cushion to provide protection against losses, and the capital they were required to hold met regulatory standards but fell well below the capital levels maintained by many large financial institutions (private money), eventually evidenced by rates of seriously delinquent mortgages they either owned or guaranteed exceeded any levels of the previous decade. And as we all know, since conservatorship the private sector has almost abandoned the secondary market and the GSEs and Ginnie Mae have stepped up to fill the void.
Of course, wanting to earn a profit leads to business decisions that aren't always popular in the industry - no surprise. I received this note: "Rob, there is a lot of informal chatter about sales caps. Some say that a policy exists, others say it is being formulated, still others say that it won't happen given the agencies supposedly wanting to cultivate more clients and the government not wanting to dampen any housing rebound. And I have heard that the MBA has had policy discussions with Fannie Mae. At our shop we think that the agencies will have to consider how selling servicing fits into this. More precisely, as best we can tell from the rumors, the sale of servicing doesn't currently provide relief from the potential cap. I understand the counterparty concerns that Fannie has, but this aspect of the new policy makes no sense. Sale of the servicing transfers the sellers' reps & warrants to the servicer, so that reduces Fannie's exposure to the original seller. Hopefully any agency putting a cap in place during the next year considers this. Ironically, under the Bifurcated Co-Issue program, the seller's reps don't transfer to the servicer, so Fannie requires a significantly higher net worth for a seller to participate. I guess they feel like they can have it both ways?"
But this note on the gfee increase: "I'm amazed at how many comments I've heard and read from the mortgage industry about the guarantee fees hurting the customers, borrowers, and consumers. I'd like to know the last time 10 bps made a deal fall out or cause the borrower to not qualify. Even if the lender has to increase rates by 1/8th to cover the cost, it's hard to say that a consumer getting a 3.625% 30 year fixed instead of a 3.5% rate is getting taken by the government. Let's remember the government is the reason the rates are this low to begin with. Our industry can't have it both ways. We can't have the government pressuring and keeping rates low while at the same time not expecting them to 'attempt' to be sustainable."
Turning to recent agency and investor updates and event announcements, I am very excited because Lindsay Lohan and Amanda Bynes have decided, as part of their work release program, to help with the investor updates. It turns out that, deep down inside, both of them feel very deeply about documentation, DTI changes, mortgage conferences, and program rollouts.
Washington State mortgage professionals - mark your calendars - the Washington Association of Mortgage Professionals (WAMP) 2012 Business and Humanitarian Leadership Awards (annual industry celebration) is being held at the Seattle Renaissance Hotel, Thursday, October 4th. Per the organizer, last year's event was very well attended and everyone had a great time, this year's event promises to be even more spectacular. For additional information, and to register for the event, please visit www.myWAMP.org.
Many LO's are pleased about an alternative to documenting income for Refi Plus loans where payment increases will be under 20 percent. Rather than requiring that at least one of the borrowers has a documented source of income, Fannie Mae will now accept verification of liquid financial reserves equal to at least 12 months of the new mortgage payment (PITIA). Documentation can be through one or more recent statement of liquid reserves in bank accounts, money markets, stock accounts, retirement savings accounts, or certificates of deposit. Fannie Mae is also providing streamlined documentation requirements for other underwriting criteria for these loans: https://www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2012/sel1209.pdf.
Not to belabor the point, but Fannie relaxed HARP reps and warrants. Specifically, "the lender is not required to make any representation and warranty as to the value, marketability, or condition of the subject property." Documentation and borrower qualification regs were also loosened. One LO wrote to me, "Take that NAR!"
Citibank has revised its loan registration policy for large deposits. In cases where an account was opened within 90 days of the loan application or the sum of unexplained deposits on the borrower's account statements over a 30-day period exceeds 25% of the total monthly qualifying income, the source of the funds must be fully documented and explained. This will affect loans registered on and after September 22nd.
In compliance with recent Freddie policy changes, Citi has updated its eligibility requirements for condo projects, which now apply to all project review types. The new requirements state that all projects currently embroiled in litigation concerning their soundness, safety, habitability, or functionality are ineligible. Litigation involving non-monetary neighbor disputes about rights of quiet enjoyment, for example, would not render a project ineligible. Lawsuits where the litigation amount is known and the insurance provider has agreed to both cover this amount and provide defense are also acceptable. As part of Citi's alignment with Freddie policy, all budget and legal document reviews for condo projects will be subject to the scrutiny of additional details.
Citi has clarified that a verification of mortgage must be obtained for each mortgage liability where the borrower is presently an obligor on the note secured by real estate and the mortgage is not disclosed on the credit report. The mortgage must also be verified if borrowers are obligated on an undisclosed mortgage and their personal tax returns include mortgage interest deductions or payments.
The Citi requirements for tax-exempt income documentation have been updated to state that borrowers with tax-exempt and/or non-taxable income are to be evaluated using the same protocol as for borrowers with higher gross taxable income. No additional documentation is necessary for borrowers who indicate that they did not file a tax return provided that the 4506T transcript backs this up.
Lastly, Citi reminded correspondents that it will accept Life of Loan flood certifications from Core Logic Flood Services at no charge, while loans submitted for purchase with life of Loan Certification from other determination services are subject to a $10 fee.
Well, the markets grind on. It is hard to be excited about economic news when we know the Fed is going to keep overnight rates near 0% for 2-3 more years, and are in buying billions of MBS every day soaking up the supply. But yesterday after the early going we learned that the Conference Board's index of leading economic indicators fell 0.1% in August, following an increase in July and a decline in June. "The U.S. LEI has declined in three of the last six months. While its six-month growth rate has slowed substantially, it still remains in growth territory due to positive contributions from the financial components including stock prices, yield spread and the Leading Credit Index." And the Philadelphia Federal Reserve Bank's general economic index improved to minus 1.9, higher than forecast, from minus 7.1 in August.
The weak news led to agency MBS prices being "higher and tighter" (to Treasury yields), and setting more price records. Hey, what's to stop more of that if originator supply is $2 billion per day and the Fed is buying $4 billion? MBS prices improved by about .250 - whether that was passed on to rate sheets remains to be seen - while the lowly 10-yr Treasury was basically unchanged at 1.78%. And in the early going today, with no scheduled news, we're unchanged from Thursday afternoon.
Perks of reaching 50, or being over 60 and heading towards 70 (part 1 of 2):
1. Kidnappers are not very interested in you.
2. In a hostage situation you are likely to be released first.
3. No one expects you to run. Anywhere.
4. People call at 9 PM and ask, "Did I wake you?"
5. People no longer view you as a hypochondriac.
6. There is nothing left to learn the hard way.
7. Things you buy now won't wear out.
8. You can eat supper at 5PM.
9. You can live without sex but not your glasses.
...(read more)
Forward this article via email: Send a copy of this story to someone you know that may want to read it.
Source: http://www.mortgagenewsdaily.com/channels/pipelinepress/09212012-fannie-mae-freddie-mac-risk.aspx
Freddie Mac Not Pursuing Deficiency in Short Sales
In their Feb 15th, 2012 Bulletin to their servicers, Freddie Mac stated that in the event of a successful short sale closing where all parties have acted in good faith they will accept the proceeds of the sale and will not pursue the borrowers for the deficiency (entire amount owed on the original mortgage note). [...]
Source: http://www.ThompsonGroupAZ.com/freddie-mac-not-pursuing-deficiency-in-short-sales/
30-Year Fixed Mortgage Rate Returns to Record Low
Mortgage rates for 30-year fixed mortgages fell this week, with the current rate borrowers were quoted on Zillow Mortgage Marketplace at 3.34 percent.
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/IZetHFPlsJc/
Wanted Dead or Alive: 10 Criminally Outdated Design Features
Is your home stuck in a time warp? These 10 outdated features are among the biggest offenders.
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/CeSvVfNfzKo/
House of the Week: Island Homes for Sale (VIDEO)
Getting a vacation home on an island can be fairly common, but getting an entire island as a vacation retreat is a little bit harder to come by.
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/-IwrlQKZwPs/
3 Reasons Your Home Sellers Should List Their Properties in the Fall
3 Reasons Your Home Sellers Should List Their Properties in the Fall 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 Autumn is a season of many things ? pumpkins, darkening foliage, and, of course, Jack Skellington ? but it is not a season known for selling homes. As many an agent will attest, home sellers often wait until the spring to list their properties, understandably equating the warmer temperatures with a more active base of prospective homebuyers. As we’ll detail with three easy reasons, though, autumn 2012 may prove to be a fertile real estate climate for your home sellers. 1. There is Little Competition ? As we just pointed ...
3 Reasons Your Home Sellers Should List Their Properties in the Fall 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/UK9s9zOHoCQ/
CAR Inaugural Gala ? 9.13.12
CAR Inaugural Gala – 9.13.12 was originally published on Chicago Agent Magazine, the leading source for news and perspective for real estate professionals in the Chicagoland area.
The Chicago Association of Realtors hosted its 129th Inaugural Gala on Thursday, Sept. 13 at Chicago?s InterContinental Hotel-Magnificent Mile. The Inaugural Gala is the annual installation and awards ceremony for incoming CAR leadership and preeminent leaders in Chicago real estate, including the newest member of the CAR Hall of Fame and the 2012 Realtor of the Year. The evening attracted nearly 600 participants.
CAR Inaugural Gala – 9.13.12 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/_km2tWsUWf0/
UK's Labour to impose "real" bank split if elected - Miliband
MANCHESTER, England, Sept 30 (Reuters) - Britain's Labour
opposition leader launched an offensive against banks on Sunday
ahead of his party's annual conference, promising a "real
separation" of... 
opposition leader launched an offensive against banks on Sunday
ahead of his party's annual conference, promising a "real
separation" of...
Mortgage Tip : Use ?Rate Locks? To Get A Lower Mortgage Rate
Learn how to use mortgage rate locks for your personal gain. Pick a better closing date, get a better mortgage rate.
Click for the complete post : Mortgage Tip : Use “Rate Locks” To Get A Lower Mortgage Rate.
Source: http://feedproxy.google.com/~r/TheMortgageReports/~3/Lhg6EhuXxrc/rate-lock-lower-mortgage-rates
Fed won't "enable" irresponsible fiscal policy-Bullard
WASHINGTON (Reuters) - The Federal Reserve will not "enable" bad fiscal policy by deliberately holding down borrowing costs to allow the U.S. government to go on a spending binge, a senior Federal... 
Source: http://feeds.reuters.com/~r/news/economy/~3/7WRSSU4WW3U/us-usa-fed-bullard-idUSBRE88Q1MA20120927
Saturday, September 29, 2012
Montana governor sees big savings with new state health clinic
HELENA, Mont., Sept 29 (Reuters) - Montana, looking to cut
down on state healthcare costs, has opened the nation's first
government-run clinic for state employees in a program the Rocky
Mountain... 
down on state healthcare costs, has opened the nation's first
government-run clinic for state employees in a program the Rocky
Mountain...
Source: http://feeds.reuters.com/~r/news/usmarkets/~3/R6hBCxANQ_k/usa-montana-health-idUSL2E8K59RF20120929
Greece's 2013 budget to deepens cuts, sustain recession
ATHENS (Reuters) - Greece will unveil a draft budget for 2013 on Monday which will cut deeper into public spending to impress international lenders but also prolong the economic pain of the Greek... 
Source: http://feeds.reuters.com/~r/news/economy/~3/J5UPbjgjc2U/us-greece-budget-idUSBRE88R0OI20120928
CAR Inaugural Gala ? 9.13.12
CAR Inaugural Gala – 9.13.12 was originally published on Chicago Agent Magazine, the leading source for news and perspective for real estate professionals in the Chicagoland area.
The Chicago Association of Realtors hosted its 129th Inaugural Gala on Thursday, Sept. 13 at Chicago?s InterContinental Hotel-Magnificent Mile. The Inaugural Gala is the annual installation and awards ceremony for incoming CAR leadership and preeminent leaders in Chicago real estate, including the newest member of the CAR Hall of Fame and the 2012 Realtor of the Year. The evening attracted nearly 600 participants.
CAR Inaugural Gala – 9.13.12 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/_km2tWsUWf0/
Basel III to Help Big Banks? A Calculation Tool to Show it's Impact; Texas Ratio Helps LO's Think About Bank Health
Even though last Saturday was the equinox, here's the weird thing: five days after the equinox today is the "longest" day of the year! If you're thinking about the sun and the earth, or time, you're barking up the wrong tree...just like statistics, and ways of reducing the deficit, there are different ways of looking at the same thing. In this case, there are a lot of ways to measure how long things are. "Thursday September twenty-seventh" is the longest day of the year! The longest in terms of text, that is: Thursday September twenty-seventh. Give that one to your kids!
As California goes, so goes the nation? We'll see, but Governor Brown signed into law several mortgage-related bills.
I am sitting here wearing my Countrywide golf shirt, drinking out of my Long Beach mug, my mouse sitting on my WAMU mouse pad, a little yellow Greenpoint duck somewhere in the drawer. (My Taylor Bean & Whittaker bourbon is hidden, otherwise my dog gets into it.) And now my Smith Barney t-shirt has made the cut! Morgan Stanley has officially dropped the Smith Barney name from its wealth management business, making the former Citigroup brokerage the latest name casualty. Morgan Stanley Smith Barney (kind of like that Bank of America Merrill Lynch name that is still with us) has 17,000 financial advisers in 740 locations, will now be known as "Morgan Stanley Wealth Management." Smith Barney's been around since the 1800's - a little longer than Household Finance (pencil holder) or First Magnus (cap).
"I am hearing that what LO's are busy with is refinancing folks they refinanced 6 months ago. True?" You bet it is true. Lots of folks that didn't qualify then don't qualify now, thus the hope for property values to increase so that equity can increase, slowly expanding the pool of eligible borrowers to...refinance. Rates are certainly cooperating. QE3 gave the mortgage market a shot in the arm as $40B per month in Fed purchases has helped to boost MBS prices. However, this policy change, in addition to others, is certainly creating some turmoil in the "specified pool" market. (That is the market where the agencies or aggregators slice and dice pools of loans, assembling groups of loans with certain characteristics that investors "specify" and for which they'll pay a higher price.) Higher prices/lower rates will likely increase prepay speeds but the immensity of Fed buying can also cause heartburn. When the Fed targets a coupon for purchases, paper can become scarce and this typically results in higher roll costs if a security hedge isn't filled and has to be moved to the next month. The higher cost or "specialness" of the roll translates into MBS becoming more expensive to use as a hedge. Consequently, traders, who typically use TBA trades to hedge their position, are being forced to consider other alternatives, including treasuries and swaps.
Why should anyone care about any of this? Specified pay-ups for these coupons will be lower. Pools of conventional loans of less than $85k, for example, were priced higher than "normal" production by 1.5 points at one point. Now, however, $85k max Fannie 30-yr 3.5's are now "only" 1.25 better. Meanwhile, Fannie and Freddie's recently announced an increase in guaranty fees will likely have the inverse impact of QE3 and will be passed along to borrowers in the form of higher costs/rates, thus slowing speeds. How's a Capital Markets guy supposed to keep up?
While the industry deals with QE Unlimited volatility, now is not the time to forget Basel III and its proposed restrictions on servicing and capital. The OCC and FDIC announced the availability of a regulatory capital estimation tool to help community banking organizations and other interested parties evaluate recently published regulatory capital proposals. The tool will assist these organizations in estimating the potential effects on their capital ratios of the agencies' Basel III Notice of Proposed Rulemaking (NPR) and Standardized Approach NPR. By the way, the comment period on current regulatory capital standards ends on October 22. The Basel III NPR focuses primarily on strengthening the level of regulatory capital requirements and improving the quality of capital. The Standardized Approach NPR proposes a number of enhancements to the risk-sensitivity of the agencies' capital standards. The tool is intended to help institutions estimate the potential effect the proposals could have on their capital ratios. It should not be relied on as an indicator of an institution's actual regulatory capital ratios and is not part of the NPRs nor of any final rule(s) that the agencies may adopt. The estimation tools are available for banks, savings associations and their holding companies. And if you just can't get enough, here is the link to the Basel III NPR and the Standardized Approach NPR.
A story in the Financial Times reports, "Rules aimed at curbing financial sector excess could drive more business to the biggest banks and make it even more difficult to allow the world's largest lenders to fail, the International Monetary Fund has warned. The IMF argued in a paper released on Tuesday that the Basel III rules - global regulators' response to the financial crisis - would exacerbate the too-big-to-fail problem, where governments were forced to rescue financial institutions deemed so large, or interconnected, that their collapse would wreak havoc on the entire financial system." "Big banking groups with advantages of scale may be better able to absorb the costs of the regulations; as a result, they may become even more prominent in certain markets, making these markets more concentrated," IMF analysts wrote in the chapter of its latest Global Financial Stability Report. The IMF cautioned that the rules were also raising the incentives to develop new products to circumvent the framework. There was also a 'high chance' that the framework would push riskier activity into less regulated parts of the financial system." Has anyone seen my SISA rate sheet?
"I am a retail LO in Georgia, thinking about throwing in the towel and going to work for a bank. A bank has offered me a spot, but then a friend told me that the bank's 'Texas Ratio' is above 100. Does that matter for a lowly LO?" Sure it does. The Texas ratio is a measure of a bank's credit troubles: the higher the Texas ratio, the more severe the credit troubles. The actual ratio is calculated by dividing the value of the lender's non-performing assets (Non-performing loans + Real Estate Owned) by the sum of its tangible common equity capital and loan loss reserves. The history of recent bank failures suggests that any bank above 100 has a much higher probability of closing down. Per Pacific Coast Bankers, there are "248 banks remaining with a TR greater than 100% scattered across 39 different states. Overall, given there were 6,639 institutions ("banks") in the country, this group represents about 3.7% of the total. That is a strong improvement from the peak when it was much higher. Broken down by state, GA still has the most strained banks by this measure at 49, followed by IL (31) and FL (30). Taken as a group, these three states alone represent about 44% of all the troubled banks in the country." At this point, of all of Georgia's banks, 21% of them are strained with a TR of 100% or more, followed by Washington DC with 20%. For a list and more information visit here.
The M&A, MI, and investor updates have been a deluge in September. As always, it is best to read the actual bulletin, and "good luck" if you're looking for less documentation, lower net worth requirements, or easier processing.
Bank mergers continue. In the Pacific Northwest, Columbia Banking System and West Coast Bancorp (both are publicly held) jointly announced that the companies have agreed to combine their two leading Pacific Northwest community bank franchises in a transaction valued at approximately $506 million. The combined company will have approximately $7.2 billion in assets with over 150 branches throughout Washington and Oregon and will rank number 1 in deposit market share amongst commercial community banks in the combined states of Washington and Oregon.
"Republic Mortgage Insurance Company ("RMIC") has received a Notice of Hearing from the North Carolina Department of Insurance ("NCDOI"). The Hearing is scheduled for October 16, 2012, and its purpose is to enable the NCDOI and stakeholders to consider a revised Corrective Plan ("the Plan") submitted by RMIC on September 14, 2012, as required by the NCDOI Commissioner's Summary Order ("the Order") dated January 19, 2012. The Notice of Hearing and related information has been posted on the Company's website at www.rmic.com."
GMAC has made a few alterations to its Lock Loan Flow interface on the Correspondent Funding website. The Borrower Name, Borrower SSN, Co-Borrower Name, Co-Borrower SSN, and Street Address fields are no longer available when locking a floating loan; any corrections to these fields should be made by contacting the GMAC Registration Desk. Once a floating loan has been submitted for underwriting, all data fields will become inaccessible apart from the lock window and commitment type. To make any corrections or updates after the loan has been received and/or the underwriting team has made a decision, clients should, again, contact the GMAC Registration Desk. Clients are reminded that it is their responsibility to notify the underwriter of any data changes following a loan's submission.
Fifth Third reminded clients that, if title was held by an "ineligible entity" in either the last 24 months or in cases where it has been less than 24 months since the borrower purchased the property, refinance transactions are not permitted. "Any entity other than a natural person, qualifying Inter Vivos Trust or Illinois Land Trust" is considered to be an ineligible entity.
The Fifth Third Interested Party Transaction Policy has been updated such that an Interested Party is now defined as a family member of an employee who works for the entity originating the loan or someone who both works for and is seeking financing from the originating entity. Children, parents, grandparents, spouses, foster children, brothers, sisters, stepsiblings, uncles, and aunts are all considered to be "family." All such transactions will be reviewed to ascertain that the relationship has not compromised the transaction. A 4506T must be completed to verify the income, and sellers are required to document the 1008 and include commentary. These loans should be submitted through pre-close or post-close channels and flagged as being an interested party transaction. Failure to do so will result in the loan being referred to the Fifth Third Risk department for audit.
And verbiage concerning lender-paid broker compensation in the Fifth Third Broker cert. form has been updated, which is now available on the Wholesale Connect site. The updated form replaces the old one with immediate effect. The Principal Curtailment matrix has also been updated and is available on the product manual page of the site.
Enough investor stuff! Although rates were nudged a little higher yesterday, how high can mortgage rates really go with the Fed buying twice the average daily production? Prices started out well, but then moved back nearly to unchanged from Tuesday's close resulting in a few price changes. For news we learned that New Home sales declined for August.
Today we've had quite a bit of information. The weekly numbers for Initial Claims showed +359k, better than expected. Durable Goods for August fell by about 13%; it is always volatile but this was quite a drop! And Real GDP for the 2nd quarter was surprising at only +1.3%, much lower than expected. Our economy is heading in the right direction, but very slowly. Later the Treasury closes out the monthly note supply with the $29 billion 7-yr note auction. In the early going the 10-yr yield, which closed Wednesday around 1.65%, is little changed (1.64%), while agency MBS prices are down.
I don't speak or write Chinese, but you don't have to - in 60 seconds you'll learn that this is a pretty clever way to separate an egg.
Forward this article via email: Send a copy of this story to someone you know that may want to read it.
Source: http://www.mortgagenewsdaily.com/channels/pipelinepress/09272012-texas-ratio-basel-iii-fdic.aspx
Builders bullish on housing
Home builders continue to be bullish about housing.
The National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index, released Tuesday, posted its fifth consecutive rise in builder confidence for newly built single-family houses. The latest gain pushed the September index to its highest level in more than six years, according to the Washington, D.C.-based trade [...]
The National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index, released Tuesday, posted its fifth consecutive rise in builder confidence for newly built single-family houses. The latest gain pushed the September index to its highest level in more than six years, according to the Washington, D.C.-based trade [...]
Lots to do Outside Your Chicago Home
Temperatures are dropping and the area has already seen its first frost, so this weekend would be a good time to tend to those gardens around Chicagoland. Covering vegetation to protect it from frost will allow water to freeze on the protection device, not on the plant. Don’t use plastic or vinyl, which can trap [...]
Source: http://www.chicagolandrealestateforum.com/2012/09/28/lots-to-do-outside-your-chicago-home/
Two Dogs Southwest Gallery
Native American jewelry and d�cor are often highly sought after items here in the Valley of the Sun. With so many places carrying these items, sometimes it can be difficult to find a knowledgeable and reputable seller. Look no further! The DeYoung family has owned Two Dogs Southwest Gallery since 1975. Featuring jewelry from 20 [...]
Source: http://www.ThompsonGroupAZ.com/two-dogs-southwest-gallery/
Now You?re Cooking ? With Gas
It?s often not all that difficult to convert from electric to gas cooking.
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/C4EmHM5GjxU/
Building Safely without Government Building Codes
Most people accept building codes as a necessary government intervention. One Website states: Codes provide minimum standards for building construction in order to safeguard the public?s safety, health, and welfare. Another Website states: If we searched we could find examples of people having built things that ended up falling on or burning up other property [...]
Source: http://stlhba.hbablog.com/2012/09/28/building-safely-without-government-building-codes/
China seeks to discredit Bo, supporters cry foul
BEIJING, Sept 29 (Reuters) - The Chinese government pressed
ahead on Saturday with an effort to discredit fallen politician
Bo Xilai, drawing an outcry from leftist supporters of the
former... 
ahead on Saturday with an effort to discredit fallen politician
Bo Xilai, drawing an outcry from leftist supporters of the
former...
Source: http://feeds.reuters.com/~r/news/usmarkets/~3/0NaHyWI2uIw/china-politics-idUSL4E8KT01220120929
CAR Inaugural Gala ? 9.13.12
CAR Inaugural Gala – 9.13.12 was originally published on Chicago Agent Magazine, the leading source for news and perspective for real estate professionals in the Chicagoland area.
The Chicago Association of Realtors hosted its 129th Inaugural Gala on Thursday, Sept. 13 at Chicago?s InterContinental Hotel-Magnificent Mile. The Inaugural Gala is the annual installation and awards ceremony for incoming CAR leadership and preeminent leaders in Chicago real estate, including the newest member of the CAR Hall of Fame and the 2012 Realtor of the Year. The evening attracted nearly 600 participants.
CAR Inaugural Gala – 9.13.12 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/_km2tWsUWf0/
Friday, September 28, 2012
Are You Getting a Refund From Discover?
In recent months, a number of lenders have had to radically change the way in which they market certain products ...
5 Things to Do in Chicago This Weekend: September 14-16
Several of the Dream Town crew are excited about the festivities planned in their own Chicago neighborhoods this weekend. Topping their list? The Chipotle-hosted “Cultivate Chicago” in Lincoln Park, bringing together the city’s best chefs, local farmers and butchers, live music and interactive games advocating local food and fair practices. But there’s more! The Beethoven Festival is redefining classical music’s influence and “Sweet Home Chicago” is teaching locals more about their sugary past. The weekend rounds itself out with the [...]
5 Favorite Appliance Features
Before you fork over tons of extra cash for fancy options, check out our list of five can?t-live-without appliance features.
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/s2ZjokSGgVY/
Is the Section 8 Housing Program Good for Landlords?
Getting your rental property qualified for Section 8 housing can be a lengthy process, but the work can be worth it.
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/73pC2m0SM6g/
30-Year Fixed Mortgage Rate Hits Yet Another Record Low, Falls Below 3.2 Percent for the First Time
Mortgage rates for 30-year fixed mortgages fell this week, with the current rate borrowers were quoted on Zillow Mortgage Marketplace at 3.18 percent, down from 3.34 [...]
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/kRhMTLfhxMQ/
Freddie and Fannie Can Earn a Profit, Right? And their Double-secret "High Risk" Watch List of 300 lenders
"Rob, I'm a new LO in Connecticut. What's the scoop on this news about loans in my state being more expensive than others for home loans?" Under the FHFA's proposal, Fannie & Freddie would hike fees between 15 and 30 basis points on lenders in Connecticut, Florida, Illinois, New Jersey, and New York. During a foreclosure those states apparently have considerably longer time frames to obtain marketable title than the national average as well as costs that range between 9 and 18 percentage points above the national average.
State specific pricing, especially for aggregator's servicing released premiums, have been around a long time. (In fact, it is not hard to remember the days when newspapers would publish the average rates in different areas of the U.S., rather than a national average.) And it is no secret that the agencies are out to make profits, just like the rest of the industry, and rumored that many segments of their businesses have a goal to be self-sufficient in case they're eventually peeled off. Here is the link to FHFA press release. And here is the link to the actual notice.
But don't stop there! The FHFA's report on the "High Risk" Watch List at Freddie and Fannie is worth a gander. The report made a case study out of TBW, but provides information about how to stay off the list (wherever the list is - ask your rep). Go to http://www.fhfaoig.gov/ and look under "Current Activities" for "FHFA's Oversight of the Enterprises' Management of High-Risk Seller/Servicers".
Recently Edward DeMarco, Acting Director of the Federal Housing Finance Agency (FHFA) and thought to be a good guy by most accounts with whom I've spoken, sketched in a broad outline of the agency's vision for the future of the mortgage finance markets in the coming years. That future, of course, may or may not include Fannie or Freddie. It seems that the FHFA has three goals for its conservatorship: build a new infrastructure for the secondary mortgage market, gradually contract the GSEs' dominant presence in the marketplace while simplifying and shrinking their operations, and maintain foreclosure prevention activities and credit availability for both new and refinanced mortgages.
Any lender issuing Fannie securities is quick to notice that a new securitization platform for the secondary market is a key to this vision, but will also notice that a single, common securitization platform is not the same as a single security. The FHFA plans that this platform would be a utility that would outlast the GSE's. DeMarco said he strongly believes in competitive markets and, as a utility, the platform should enhance liquidity, standardization, and transparency, all of which should foster that competition. Whatever the structure of the secondary market of the future, certain key functions will need to be performed and in many cases, like developing data reporting standards, the standardization of such functions will benefit the overall market.
And taking an even further step back, the last FHFA semi-annual report to Congress included a section detailing, in financial terms, the fall of Freddie and Fannie. Are we being reminded that anyone who doesn't know history is doomed to repeat it? The GSEs' mission was to provide liquidity to the housing finance system. They did this primarily by supporting the secondary mortgage market through the purchase of residential mortgages from originators who then used the proceeds to originate more loans, either holding the mortgages in investment portfolios or packaging them into mortgage-backed securities (MBS). These MBS were then sold to investors, and with a fee, the GSEs guaranteed the performance of the MBS they sold. The operations were financed through MBS sales and through funds borrowed from large individual, institutional, and foreign investors. The GSEs hold they maintained special accounts or reserves to which they made regular contributions called provisions for loan losses, as there will inevitably be defaults from some homebuyers. The fees they charged for their guarantees were intended to cover the small subset of loans that were expected to default and reserves were established for those losses - see where the gfees come in?
Upon default, loan servicers may commence foreclosure and take possession of the collateral property. Upon completion of this process, the GSE erases or charges off the unpaid mortgage balance, debiting the corresponding loss reserves. If the collateral property is subsequently sold the proceeds will offset losses. When the housing market collapsed, losses on loans and guarantees vastly exceeded that loss-covering capacity. The GSEs had grown rapidly with only a thin capital cushion to provide protection against losses, and the capital they were required to hold met regulatory standards but fell well below the capital levels maintained by many large financial institutions (private money), eventually evidenced by rates of seriously delinquent mortgages they either owned or guaranteed exceeded any levels of the previous decade. And as we all know, since conservatorship the private sector has almost abandoned the secondary market and the GSEs and Ginnie Mae have stepped up to fill the void.
Of course, wanting to earn a profit leads to business decisions that aren't always popular in the industry - no surprise. I received this note: "Rob, there is a lot of informal chatter about sales caps. Some say that a policy exists, others say it is being formulated, still others say that it won't happen given the agencies supposedly wanting to cultivate more clients and the government not wanting to dampen any housing rebound. And I have heard that the MBA has had policy discussions with Fannie Mae. At our shop we think that the agencies will have to consider how selling servicing fits into this. More precisely, as best we can tell from the rumors, the sale of servicing doesn't currently provide relief from the potential cap. I understand the counterparty concerns that Fannie has, but this aspect of the new policy makes no sense. Sale of the servicing transfers the sellers' reps & warrants to the servicer, so that reduces Fannie's exposure to the original seller. Hopefully any agency putting a cap in place during the next year considers this. Ironically, under the Bifurcated Co-Issue program, the seller's reps don't transfer to the servicer, so Fannie requires a significantly higher net worth for a seller to participate. I guess they feel like they can have it both ways?"
But this note on the gfee increase: "I'm amazed at how many comments I've heard and read from the mortgage industry about the guarantee fees hurting the customers, borrowers, and consumers. I'd like to know the last time 10 bps made a deal fall out or cause the borrower to not qualify. Even if the lender has to increase rates by 1/8th to cover the cost, it's hard to say that a consumer getting a 3.625% 30 year fixed instead of a 3.5% rate is getting taken by the government. Let's remember the government is the reason the rates are this low to begin with. Our industry can't have it both ways. We can't have the government pressuring and keeping rates low while at the same time not expecting them to 'attempt' to be sustainable."
Turning to recent agency and investor updates and event announcements, I am very excited because Lindsay Lohan and Amanda Bynes have decided, as part of their work release program, to help with the investor updates. It turns out that, deep down inside, both of them feel very deeply about documentation, DTI changes, mortgage conferences, and program rollouts.
Washington State mortgage professionals - mark your calendars - the Washington Association of Mortgage Professionals (WAMP) 2012 Business and Humanitarian Leadership Awards (annual industry celebration) is being held at the Seattle Renaissance Hotel, Thursday, October 4th. Per the organizer, last year's event was very well attended and everyone had a great time, this year's event promises to be even more spectacular. For additional information, and to register for the event, please visit www.myWAMP.org.
Many LO's are pleased about an alternative to documenting income for Refi Plus loans where payment increases will be under 20 percent. Rather than requiring that at least one of the borrowers has a documented source of income, Fannie Mae will now accept verification of liquid financial reserves equal to at least 12 months of the new mortgage payment (PITIA). Documentation can be through one or more recent statement of liquid reserves in bank accounts, money markets, stock accounts, retirement savings accounts, or certificates of deposit. Fannie Mae is also providing streamlined documentation requirements for other underwriting criteria for these loans: https://www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2012/sel1209.pdf.
Not to belabor the point, but Fannie relaxed HARP reps and warrants. Specifically, "the lender is not required to make any representation and warranty as to the value, marketability, or condition of the subject property." Documentation and borrower qualification regs were also loosened. One LO wrote to me, "Take that NAR!"
Citibank has revised its loan registration policy for large deposits. In cases where an account was opened within 90 days of the loan application or the sum of unexplained deposits on the borrower's account statements over a 30-day period exceeds 25% of the total monthly qualifying income, the source of the funds must be fully documented and explained. This will affect loans registered on and after September 22nd.
In compliance with recent Freddie policy changes, Citi has updated its eligibility requirements for condo projects, which now apply to all project review types. The new requirements state that all projects currently embroiled in litigation concerning their soundness, safety, habitability, or functionality are ineligible. Litigation involving non-monetary neighbor disputes about rights of quiet enjoyment, for example, would not render a project ineligible. Lawsuits where the litigation amount is known and the insurance provider has agreed to both cover this amount and provide defense are also acceptable. As part of Citi's alignment with Freddie policy, all budget and legal document reviews for condo projects will be subject to the scrutiny of additional details.
Citi has clarified that a verification of mortgage must be obtained for each mortgage liability where the borrower is presently an obligor on the note secured by real estate and the mortgage is not disclosed on the credit report. The mortgage must also be verified if borrowers are obligated on an undisclosed mortgage and their personal tax returns include mortgage interest deductions or payments.
The Citi requirements for tax-exempt income documentation have been updated to state that borrowers with tax-exempt and/or non-taxable income are to be evaluated using the same protocol as for borrowers with higher gross taxable income. No additional documentation is necessary for borrowers who indicate that they did not file a tax return provided that the 4506T transcript backs this up.
Lastly, Citi reminded correspondents that it will accept Life of Loan flood certifications from Core Logic Flood Services at no charge, while loans submitted for purchase with life of Loan Certification from other determination services are subject to a $10 fee.
Well, the markets grind on. It is hard to be excited about economic news when we know the Fed is going to keep overnight rates near 0% for 2-3 more years, and are in buying billions of MBS every day soaking up the supply. But yesterday after the early going we learned that the Conference Board's index of leading economic indicators fell 0.1% in August, following an increase in July and a decline in June. "The U.S. LEI has declined in three of the last six months. While its six-month growth rate has slowed substantially, it still remains in growth territory due to positive contributions from the financial components including stock prices, yield spread and the Leading Credit Index." And the Philadelphia Federal Reserve Bank's general economic index improved to minus 1.9, higher than forecast, from minus 7.1 in August.
The weak news led to agency MBS prices being "higher and tighter" (to Treasury yields), and setting more price records. Hey, what's to stop more of that if originator supply is $2 billion per day and the Fed is buying $4 billion? MBS prices improved by about .250 - whether that was passed on to rate sheets remains to be seen - while the lowly 10-yr Treasury was basically unchanged at 1.78%. And in the early going today, with no scheduled news, we're unchanged from Thursday afternoon.
Perks of reaching 50, or being over 60 and heading towards 70 (part 1 of 2):
1. Kidnappers are not very interested in you.
2. In a hostage situation you are likely to be released first.
3. No one expects you to run. Anywhere.
4. People call at 9 PM and ask, "Did I wake you?"
5. People no longer view you as a hypochondriac.
6. There is nothing left to learn the hard way.
7. Things you buy now won't wear out.
8. You can eat supper at 5PM.
9. You can live without sex but not your glasses.
...(read more)
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Source: http://www.mortgagenewsdaily.com/channels/pipelinepress/09212012-fannie-mae-freddie-mac-risk.aspx
30-Year Fixed Mortgage Rate Returns to Record Low
Mortgage rates for 30-year fixed mortgages fell this week, with the current rate borrowers were quoted on Zillow Mortgage Marketplace at 3.34 percent.
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/IZetHFPlsJc/
Closing Your Vacation Home for the Winter
If you plan on vacating a seasonal property, there are a few basic things you can do to help safeguard your house through the cold months ahead.
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/3UxKZ40WqXU/
Why the Recent G-fee Increase? Why the Annual Fannie Sales Cap? Will There be More?
The U.S. Government now has a $16 trillion deficit. On the other hand, it made about $12 billion on the AIG stock sale - congrats. To put those numbers in context, however, the government would have to do an AIG deal every day, seven days a week, for nearly four years in order to erase the current deficit.
As John Steinbeck famously said, the problem with poor Americans is that "they don't believe they're poor, but rather temporarily embarrassed millionaires." Has the housing market been "temporarily" down? One can never overestimate the intelligence of the masses, but the Financial Times reports that "Americans' confidence in the outlook for the housing market has risen and they believe home prices will continue to rise in the next year, according to a new survey by Fannie Mae." Better than believing otherwise, right? "A rising number of people predicted mortgage rates would go up in the next 12 months, up to 40% last month from 36% in July, while those who felt it was a good time to sell property increased to 18 per cent from 16 per cent. The number of people surveyed who predicted house prices would increase remained steady in August at 35%, but was up from 20% a year ago. Americans expect house prices will rise on average by 1.6% in the next year."
The industry continues to wring their collective hands over the guarantee fee increase. (I've been in the biz so long, I remember when there was a "guarantee fee" and a "guarantor fee", depending on the agency.) I received a note from an industry vet, saying, in part, "The biggest fear in our industry right now is not rising rates but that FNMA and FHMLC, already in receivership, have been given a death sentence with no chance of parole. It sadly appears to many of us that, no matter how reformed and beneficial the GSE's are to the health of housing market and our economy in general, they are going to subjected to a slow and painful death. The lethal injections may have already been started."
The note continued. "Case in point, the latest G-fee increase of .125% has already added a full 50 bps to our price on 60 day locks. I have also heard that FNMA that they are also capping the amount of loans that new FNMA approved seller/servicers can send directly to FNMA by capping production at 20x their net worth. So, for example, if we have a net worth of $10 million, we can only sell FNMA $200 million for the entire year. But we just closed nearly $100 million in August alone so we have no choice but to send in loans as a correspondent to the aggregators, and they in turn service the loans, steal our customers, and sell to FNMA without those caps in place as they are an established seller servicer. But wait, the fun doesn't end! With the impending Basel III reserve requirements possibly hitting even the 'too big to fail banks' in the upcoming years, there is a fear that they too will start to shrink their loan balance portfolios. This redirects us to sell loans to the agencies, which have us capped out!"
Here are my thoughts on this. First, a clarification that the gfee increase may result in approximately 50 basis points difference in price, not rate (using a 4x1 multiple).
Second, FHFA indicated that the gfee increase was intended to help flatten out the price difference between big and small lenders. If the average is 10 basis points, and the large aggregators saw 12, that means to move back to the average, by my simple calculations, plenty of "smaller guys" will see less than 10.
Third, the guarantee fee is intended to cover expected risk inherent in eligible deliveries. Even at the current gfee levels, it was generally agreed that Fannie & Freddie have been underpricing the risk on eligible loans, with support of the Government and FHFA wanted that to change. (More on how g-fees are set, and some theories about possible future increases, below.)
As it relates to these repurchases, no one is going to disagree that lender have to be financially able to repurchase ineligible loans. If you don't think monitoring counterparty risk is a huge issue, just ask the CFPB, or Capital One after it paid some hefty fines for exactly that issue. Fannie needs to manage counterparty risk, and one way to do that is by limiting deliveries based on net worth and other factors. The 20:1 ratio you reference, based on net worth, is known to be merely a starting point.
But folks are asking, "How was the delivery limit set?" It appears that Fannie took, as a starting point, the net worth of the company. For newly approved lenders, it is hard to gauge what future deliveries will look like, but for more seasoned lenders, profile of deliveries and any outstanding obligations (such as loans not repurchased) get factored into the limit. Lenders who have delivered a better book of business to Fannie are rewarded with a higher sales cap.
So what if you don't like the 20x1, or whatever ratio you might have, what can a lender do? Call Fannie Mae and talk with them about it. Another is to (gasp!) keep your earnings in the firm rather than taking them out. Per the MBA, independent mortgage banks' margins are very good (http://www.mbaa.org/NewsandMedia/PressCenter/81793.htm), so now is a great time to bump up the net worth of the company. Owners pulling out large chunks of capital in order to shield it from potential liabilities down the road may see this strategy backfire with lower delivery limits based on that reduced net worth. Another strategy is to be willing to post collateral as an alternative to increasing net worth. I've heard that putting some of that liquid net worth into an escrow/custodial account might increase whatever delivery limit is set.
So, don't be afraid to have a conversation with Fannie about your limits. And by the way, with all this talk about Fannie, let's not forget Freddie. My guess is that the FHFA gave both agencies directives, and how Fannie and Freddie implement is up to that particular agency. So watch for Freddie to come out with something similar.
Returning to the g-fee hike, how did the FHFA arrive at that level of increase, and how will increases be determined in the future? The FHFA, looking at Freddie & Fannie's portfolio performance, realized there were performance issues based on maturity, FICO, LTV, and several other factors. Underwriters knew this already, right? Most analysts who follow such things think that the G-Fee hikes should be positive for lower coupon 30 year pools, which will experience the biggest valuation upside. Although the FHFA has not announced full details, the market anticipates fee hikes on weaker credit borrowers, which should increase the price for existing pools so investors liked the news, even if lenders and borrowers did not: investors will hold onto the higher yielding pools longer. (Although just like we saw in March, the market will see a rush of refi's ahead of various investor deadlines, which in turn are based on how long it takes to pool and securitize the loans.)
Returning to the nitty-gritty, the g-fee hikes will reduce cross-subsidization of high risk loans by increasing pricing for loans with maturities greater than 15 years. The cash window will implement these changes for commitments starting on November 1. Differences in g-fees between lenders delivering large volumes to the GSEs and smaller lenders will also be reduced. Folks "in the know" say that separately, the FHFA will also publish a proposal for state level pricing for public input.
But all this still begs the question, "What is a private market g-fee?" Under the Housing and Economic Recovery Act of 2008, the FHFA is required to conduct annual studies of the g-fees charged by the GSEs and submit a report to Congress. The FHFA uses loan level data from the GSEs segmented by product type, LTV, credit score, and size of lender for the purposes of this report. Each agency's proprietary costing model is then used to estimate cost due to guarantee payments and the expected return on capital. "Private money" does not necessarily have access to this data. For F&F, the current and future g-fee is based on the projected g-fee cash inflows: is fee income sufficient to offset the cost involved in guaranteed loans, as well as the required return on capital. Makes sense to me, although one can only guess at the exact "private money gfee."
Traditionally, smaller lenders pay higher g-fees due to the perceived higher cost of doing business with them. MBS hedging costs borne by the GSEs (as smaller lenders are more likely to deliver to the cash window), liquidity disadvantages, higher effect of fixed administrative costs, and higher counterparty risks are included in those costs. And historically larger lenders are also usually able to negotiate down their g-fees: U.S. Bank does not have the same g-fee as Rob's Home Mortgage and Laundromat. But recent reports show that the higher fees charged of smaller lenders are disproportionate to the higher costs. In the future, don't be surprised if the agencies come out with either an entirely different structure, or take the current structure and use more loan-level price attributes to set the g-fees to better model the risk.
By the way, yesterday the commentary mentioned the new rep & warrant framework that clarifies future liabilities (read: reasons lenders are asked to buyback loans). Here is the actual announcement.
Turning to the temporal markets, Tuesday saw little change in prices (the 10-yr was down about .125 and closed at 1.70% and agency MBS prices were worse about 1/16 in price) on less-than average volume. Chatter in the press focused on the 3-yr auction (just fine), today's $21 billion 10-yr auction, and miscellaneous news from Europe. Today begins one of the periodic Federal Open Market Committee meetings ("ok...who took the last jelly glazed...Ben wanted it!") and the market seems to be positioning for QE3 information from the Fed later this week: mortgage pricing is doing better than Treasury pricing.
In the early going, unfortunately, rates have edged higher: the 10-yr has crept up to 1.74% and MBS prices are worse by .125-.250.
An American tourist in London decides to skip his tour group and explore the city on his own.
He wanders around, seeing the sights, and occasionally stopping at a quaint pub to soak up the local culture, chat with the lads, and have a pint of the Local Favorite.
After a while, he finds himself in a very high class neighborhood - big, stately residences - no pubs, no stores, no restaurants, and worst of all... NO PUBLIC RESTROOMS.
He really, really has to go, after all those Brews.
He finds a narrow side street, with high walls surrounding the adjacent buildings and decides to use the wall to solve his problem.
As he is unzipping, he is tapped on the shoulder by a London Bobbie, who says, "Sir, you simply cannot do that here, you know."
"I'm very sorry, officer," replies the American, "but I really, really HAVE TO GO, and I just can't find a public restroom."
"Ah, yes," said the Bobbie "Just follow me." He leads him to a back "delivery alley," then along a wall to a gate, which he opens. "In there," points the Bobbie. "Whiz away... anywhere you want."
The fellow enters and finds himself in the most beautiful garden he has ever seen.
Manicured grass lawns, statuary, fountains, sculptured hedges, and huge beds of gorgeous flowers, all in perfect bloom.
Since he has the cop's blessing, he zips down and unburdens himself and is greatly relieved.
As he goes back thru the gate, he says to the Bobbie, "That was really decent of you - is that "English Hospitality?"
"No," replied the Bobbie, with a satisfied smile on his face, "that is the German Embassy."
Forward this article via email: Send a copy of this story to someone you know that may want to read it.
Source: http://www.mortgagenewsdaily.com/channels/pipelinepress/09122012-gfee-john-steinbeck.aspx
Chicago to Become One of the Most Connected Cities in the World
Mayor Rahm Emanuel wants to make Chicago one of the most ‘connected cities’ in the entire world. On Monday, free Wi-Fi was turned on in Millennium Park so that residents of real estate in Chicago as well as tourists and business owners can take advantage of fast and easy Internet access. The Millennium Park Wi-Fi [...]
Mortgage Rates : Lower For 6 Straight Days, Going For Seven
Mortgage rates have improved for 6 straight days. A strong 5-year Treasury auction could make that seven-in-a-row.
Click for the complete post : Mortgage Rates : Lower For 6 Straight Days, Going For Seven.
@Zillow Roundup 9-21-12: Dream Apartment
This week we asked the @Zillow community to fill in the blank, "If I had to describe my dream apartment it would be ____."
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/B0uy-mMoz0c/
Thursday, September 27, 2012
Candace Bushnell Writes Off New York Apartment
The author behind the "Sex and the City" novels has the swanky home listed for $2.8 million.
Source: http://feedproxy.google.com/~r/ZillowBlog/~3/gLPGBX3L_wc/
Chicago Illinois Mortgage Rates Week in Review for the Week Ending 07/06/2012
Last week was a little bit strange, having the 4th of July fall on Wednesday. was nice having a break in the middle of the week and the fireworks were the same as they always were, but it didn?t feel like Independence day. This last week was also a bit strange because for the first [...]
Great Questions for My Loan Officer
Don’t be afraid to ask your lender questions! How long have you been doing home loans? How long have you been working for your company? How many of your loans did not close in the last year? Be sure to ask your lender to provide you a pre qualification form and not a pre approval. [...]
Source: http://www.ThompsonGroupAZ.com/great-questions-for-my-loan-officer/
Model Grand Opening at The Legacy at Millennium Park ? 9.12.12
Model Grand Opening at The Legacy at Millennium Park – 9.12.12 was originally published on Chicago Agent Magazine, the leading source for news and perspective for real estate professionals in the Chicagoland area.
An exclusive model grand opening broker event was held at The Legacy at Millennium Park on Wednesday, September 12,�featuring drinks, hors d?oeuvres and showings for the building’s units.
Model Grand Opening at The Legacy at Millennium Park – 9.12.12 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/PePop1cNEjA/
Summer Market Update
The 5-day forecast calls for highs of 107, 104, 101, 105 and 105 degrees. Well, this IS Phoenix during the summer, so at least we can be thankful the temperature will be under 110! But, nonetheless ? hot is hot, and many buyers are saying the same about the Phoenix Real Estate market.� Although the [...]
Source: http://www.ThompsonGroupAZ.com/summer-market-update/
4 Common Mistakes To Avoid When Managing Your Online Reputation
4 Common Mistakes To Avoid When Managing Your Online Reputation was originally published on Chicago Agent Magazine, the leading source for news and perspective for real estate professionals in the Chicagoland area.
By Alan Bryan Managing a company’s online reputation isn’t the easiest thing in the world to do. It involves a savvy mix of online relationship building, core online business tools and consistent attention to what’s being said about your brand online. For real estate professionals, brand reputation can seem like yet another thing you “must do.” But it is, in fact, a new crucial business practice that’s directly relevant to the bottom line. Plus, online brand management, as the�Wall Street Journal recently documented, has never been easier, what with by tools offered ...
4 Common Mistakes To Avoid When Managing Your Online Reputation 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/Xb_2OQ3PYQg/
CORRECTED-Austria sues EU over Hypo/BayernLB case
(Corrects paragraph 6 to say .. General Court .., not.. Court
of Justice) 
of Justice)
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