Millennials to have a Big Say in 20s’ Residential Real Estate

The novel Coronavirus has come in a year when a good percentage of millennials are turning 30. What this means is that this demographic is stepping into its prime home-buying years in a scary situation. True that 2020 may be a headache-inducing year but looking at the big picture, “millennials may be poised to fuel a ‘roaring 20s’ of homeownership demand”, according to  First American Financial’s Chief Economist, Mark Fleming. Fleming feels that all that the millennials need to do is make the right lifestyle choices.  Not all millennials are serious about buying…continue reading →

Mortgages in Forbearance Up after Falling for Three Weeks

Integrated Technology company Black Knight says that the total mortgages in forbearance have shot up after three successive weeks of decline.  The update on June 23 divulges that the number of mortgages under forbearance ran up to 4.68 million, a clean 83,000 above its tally a week before that.  The Government-sponsored Enterprise (GSE) mortgage (Conforming) forbearance numbers rose to 1.925 million, representing a 1.3% hike. The Federal Administration and Veteran Affairs numbers shot by 3% to 1.509 million. The uncleared forbearance principal balance shot up by 1.28% to $1,025 trillion for June 23.…continue reading →

CFPB Proposes Amending the 43% DTI Cap for QM

According to the Consumer Financial Protection Bureau’s (CFPB) Qualified Mortgage (QM) rule, all the mortgages that can be eligibly bought by Fannie Mae or Freddie Mac are exempt from the 43% debt-to-income cap. This exemption is referred to as the GSE patch (GSE stands for government-sponsored enterprises). The GSE patch is slated to expire on 10th January 2021. Convinced that both Freddie Mac and Fannie Mae benefit from a competitive advantage in underwriting, CFPB now proposes to extend the GSE patch and also make changes to the definition of QM.  Loans that have…continue reading →

Inventory Shortage May Obstruct Corona-rebound Sales

Aspiring homeowners are likely to come hard once the Coronavirus scare recedes but real estate marketplace Zillow feels that housing inventory shortage may obstruct any possible sales rebound.  Its Weekly Market Report reveals a drop of 17.1% in inventory compared to the same time last year. Over the week, it has fallen by 0.4%. Houses which are on for-sale supply also took a beating in many of the top 35 metros. The figures show a 35% dip in Cleveland, 36% in Seattle, and 34.4% in Philadelphia. To paraphrase Skylar Olsen, Zillow’s senior principal…continue reading →

Purchase Mortgage Applications at a Level Untouched Since 2009

The Mortgage Bankers Association informs that aspiring homeowners are putting behind the Coronavirus scare and filing purchase mortgage applications at a level not seen over the previous decade.  It comes as a bonus that the 30-year fixed loan rates are at their lowest since the MBA’s Weekly Mortgage Applications Survey began. Purchase mortgage applications have risen for the 9th week straight. It is partly the result of soaring consumer confidence and partly due to the demand kept in leash since spring, believes Joel Kan, the Associate VP of Economic and Industry Forecasting, MBA. …continue reading →

As Lending Standards Tighten, Mortgage Credit Availability Index Drops to a 5-year Low

Mortgage Bankers Association (MBA) after analyzing data from Ellie Mae's AllRegs® Market Clarity® business information tool reported that the Mortgage Credit Availability Index (MCAI) in April dropped to the lowest level since December 2014. The decline is MCAI shows the tightening of lending standards showing decreased availability of mortgages for potential borrowers. The MCAI index fell by 12.2% to an index of 133.5. The rate of decline in the last 2 months is the sharpest in over a decade. As evidenced by the chart below, the MCAI fell for every product category. The…continue reading →

Getting a Mortgage has suddenly become Hard (and about to get even Harder)

Mortgage credit supply decreased 16 percent in March to the lowest level since June 2015, with declines in availability across all loan types. There was a reduction in the availability of loans with lower credit scores and higher LTV ratios, and the largest pullback came from the jumbo and non-QM space. With the mortgage market shaken badly by the Coronavirus pandemic, both purchasing and refinance loans have become harder to get. JP Morgan believes that at 10% unemployment, we may be looking at 2 million new mortgage delinquencies. The number could go up…continue reading →

How does the Mortgage Payment Forbearance Plan work?

The CARES Act is a law now.  In place of a series of whack-a-mole moves, the administration has come up with the Mjolnir this soon in the battle. Instant aggression! Good approach!  To prevent the Coronavirus pandemic genie from coming out of the bottle, the $2 trillion stimulus bill from the government sounds like a plan. The big headline for the home mortgage industry is the loan forbearance plan made available to the borrowers on all the government-backed mortgages. By uttering nearly as little as I CAN’T PAY, borrowers can forgo mortgage payments…continue reading →

Mortgage Rate Recap and Outlook for the Week Ending February 21, 2020

The speed of residential construction has shot up over the past few months and is well in line to reach its best figures in over a decade. For a market that has been short on inventory for some time now, this is great news, especially with the spring season already calling on us. Mortgage Rates: rates increase all around This week’s Mortgage Banking Associations’ (MBA) weekly rate survey reveals an increase across the board. According to the MBA Weekly Survey: “The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($510,400 or less) increased to 3.77 percent…continue reading →

Mortgage Rate Recap and Outlook for the Week Ending January 31, 2020

The mortgage market had reacted favorably to the Coronavirus threat. Now that the trend is reversing, we may see a partial correction in the mortgage market. It is nothing new. Global threats that loom suddenly bring about economic movements with it and just as soon as the threats disappear, the money movement returns to its initial levels. The refinancing activity and demand for homes are on a move in the meantime, buoyed by near-record interest rate levels. Mortgage Rates: rates decrease all around This week’s Mortgage Banking Associations’ (MBA) weekly rate survey reveals a decrease across the board.…continue reading →

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