I wish I could say that this only happens in California

But I believe that as things “unwind” we will hear of more of these kind of mortgage fraud escapades happening all across the country.

Just another reason why it’s important to know who you are dealing with and to know what you are getting into when you take out a mortgage.

A Good Explanation

This article explains fairly well what is happening in the mortgage backed securities world….

She brings up the idea of mortgage lenders being responsible and helping their borrowers make and understand wise financial decisions, but she doesn’t, in my opinion, push it far enough….

There are too many mortgage lenders in the world who don’t take the time to make sure their customers get the right mortgage.

I wish I could say I fully understood the storm clouds….

that are brewing, but I don’t.

However, an article like this one paints a fairly clear picture and it isn’t a pretty one.

What does it mean for the real estate market and for mortgage rates? I’ll let you know as I know more, but I don’t think anyone really knows how it’s going to play out.

Michigan is #2

in the number of Countrywide Foreclosures currently for sale.

Though when you consider that #1 (California) has over 3.6 times as many people, it shows that Michigan isn’t sitting pretty right now….

Too Much Inventory

Okay, I’ve got an idea that I’d like your opinions on…

So many articles and news stories are going on and on about how we have too much inventory for sale and it’s causing “analysis paralysis” on the part of buyers (they can’t make a decision because there are another 298 3 bedroom ranches for sale in their price range). And how that in turn is making it harder for sellers to get the prices they wer expecting.

Well, what if every Realtor sat down with their clients and determined if they:
a. Really had to sell
b. Didn’t have to, but wanted to.
c. Were willing to sell only if they got “the right” price

and then, for every seller that falls into the “c” category, persuade them to take their house off the market and look at things again in a year.

There are over 3000 Realtors in the Greater Grand Rapids Michigan area. If every one of them were able to persuade one of their sellers to take their house off the market and look at it again in a year, that would take 3000 houses off the market. Would that:
a. Work and help the market move better?
b. Merely create a larger glut next year?
c. Not a chance that people would do that because people who want to sell don’t think about anyone else?

What do you think?

Tom

Does this happen where you are?

An interesting and yet disturbing story about Realtors and sales data…..

I’d love to hear any opinions on this…….

Do the right thing….

an interesting take on it….

Interest Rate Update

It’s hard to believe it’s going to be July already on Sunday. Wow, time flies when you are having fun!

So, what’s been happening in the mortgage business lately? Well, it’s been quite an action packed week and rates have ended up down a little after all of the action. Let me attempt to summarize it:
1. On Monday, it was announced that existing home sales fell in May to a 4 year low and the median price (remember the difference between median and average?) fell for the 10th straight month. Hardly an overheating economy.
2. On Tuesday, the largest home builder in the country announced a 2nd quarter loss when they had been expecting a profit. Not good.
3. Also, on Tuesday, new home sales were announced for May. They were down 1.6% from April, and the inventory levels increased. The bad news is that while it’s only down 1.6% from April, it’s down 15.8% from May of 2006.
4. The Conference Board Index of Consumer Confidence fell to the lowest reading since August of 2006.
5. On Wednesday, Durable Goods Orders came in down 2.8% for May. It was the lowest reading since January and indicates a reduced inflationary pressure.
6. On Thursday, the Fed announced that they were not going to change rates (no surprise there.) They also said that rather than characterizing core inflation as “elevated” they are saying that “readings on core inflation have improved modestly in the recent months.” What does that mean? Basically they are saying, in my opinion, that as far as inflation is concerned, we’re heading in the right direction (moderating) but we aren’t there yet.
7. On Thursday, KB Homes announced that they lost $148.7 million in the second quarter of 2007 and that inventory remains a big problem and they don’t know when it will improve.
8. This morning the government announced that the core PCE rate was only .1%. The important part of that is that it now puts the annual rate within the Fed’s 1 to 2% target rate. This is a good anti-inflationary sign.
So essentially what we have is a string of less than spectacular financial reports (some of which were downright ugly). In my opinion, that adds further credence to the theory that the economy isn’t doing so great and that as it moderates, it’s probably going to moderate to the point that the Fed is going to need to, within the next 6 to 9 months, look at cutting rates. Stay tuned.

On a related note, I’m sure many of you have heard that Heartwell Mortgage is shutting it’s doors. I want to pass on a couple of thoughts about that:
1. At previous banks that I’ve worked for, I’ve done a fair amount of business with some of the people at Heartwell. They have always been professionals who operate with a high degree of honesty and integrity. It’s disappointing to see a company that was run that way have to shut it’s doors.
2. In a volatile time in the mortgage business (and it is a very volatile time), I’m very glad that I’m working for a very large and established financial institution. There are a lot of storm clouds floating over the mortgage business but you don’t have to worry about Fifth Third being affected by them.
3. In a volatile time like this, it’s important to work with experienced mortgage professionals who know how to navigate the changing market (and are going to be around.) I’d love to have the chance to be of help, let me know how I can.

Okay, enough commercials. Have a great weekend!

Tom Vanderwell
Mortgage Officer

Heartwell Mortgage Corp.

Heartwell Mortgage, the longtime lender based in Grand Rapids, says it will close its retail and wholesale operations as of this Friday.
In a statement issued this afternoon, Heartwell president David Bird said, “This was an extremely difficult decision, but necessary due to the current housing environment and the increasing difficulty for a mid-sized company like us to compete.”
….
Heartwell Mortgage was founded in 1970 and has offices in six states.

It’s not nice to say anything bad about your competition

so I’m not going to say anything, just report what others are saying…..

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