Mortgage Market Update
by Tom on June 30, 2009
in Market Report, Mortgage Matters, Mortgage Rate Updates
Well, the traveling went well. My 19 year old and I are in Detroit because she’s flying out of Detroit tomorrow morning to spend 6 weeks in Haiti working at an orphanage and with a malnourished children’s program.
I had a great opportunity to sit down and chat with a local Realtor who I’ve gotten to know quite well. Vance Shutes is a great guy who really gets what it takes to keep clients happy and do things right. If I were buying or selling real estate in the Ann Arbor area, I wouldn’t hesitate to work with Vance or to recommend him to others.
However, due to the wonderful chance to talk with Vance and the fact that I have to have my daughter at the airport at 5:30 EST tomorrow morning, the Mortgage Market Update is going to wait until tomorrow morning.
I’ll have more thoughts on the market over breakfast tomorrow morning after I drop her off.
Until then,
Tom Vanderwell
Why I will never work in the credit card department of any organization……
by Tom on June 30, 2009
in Market Musings, banks
Courtesy of Mint.com
The Daily Mortgage Market Update
by Tom on June 30, 2009
in Market Report, Mortgage Matters, Mortgage Rate Updates
will get posted later today (probably tonight) due to travel schedules. No significant changes in rates so far today, recommendation remains to lock all loans.
Tom Vanderwell
House Prices – Down but not so much?
by Tom on June 30, 2009
in house prices
I’m sure we’ll hear more on the details going forward, but the Case Shiller report for May just came out. A couple of thoughts about it:
- Due to the way they track it, it is considered to be more reliable than the other methods out there.
- The pace of decline is slowing. Remember the saying, 1 month does not a trend make.
- The year over year numbers are still ugly.
We might be entering the “bottoming” of the real estate prices on a national basis, it’s just too early to tell yet.
I’ll have more on this later….
Tom Vanderwell
Home-Price Decline Eases, Suggesting Stability in Areas – Real Estate * US * News * Story – CNBC.com
Prices of U.S. single-family homes declined in April from the prior month, but the pace moderated, suggesting stability is emerging in some regions, according to Standard & Poor’s/Case Shiller home price indexes reported Tuesday.Andy Truello
The index of 20 metropolitan areas dipped 0.6 percent in April from March, after a 2.2 percent decline the month before, for an 18.1 percent downturn from a year earlier.
S&P said its index of 10 metropolitan areas declined 0.6 percent in April for an 18 percent year-over-year drop, after falling 2.1 percent month on month in March.
RELATED LINKS
Current DateTime: 06:07:24 30 Jun 2009
LinksList Documentid: 31662044* Insured Mortgage Defaults Up
* 5 Reasons Housing Hasn’t Recovered
* Short Sales Snafus Hurts Market
* One Man’s Short-Sale Tale
* Track the DJ Housing Index Here
* Realty Check with Diana OlickThe rate of annual decline in these measures has improved, from 18.7 percent for both indexes in March.
Why we probably won’t be seeing a relaxing of downpayment and mortgage insurance requirements any time soon…..
If you look at the report cited below, the delinquency problems on conventional mortgages with PMI is still clilmbing. Until that trend turns around, don’t expect to see any relaxing of downpayment and PMI requirements…….
Insured Mortgage Defaults Resume Upward Climb – Real Estate * US * News * Story – CNBC.com
By: Reuters | 30 Jun 2009 | 08:47 AM ETDefaults on privately insured U.S. mortgages rose in May following three months of declines, and the number brought up to date fell, providing new evidence that the nation’s housing market is still deteriorating.
The Mortgage Insurance Companies of America, a trade group, said 87,904 insured borrowers were at least 60 days late on payments in May, up 8 percent from April and up 29 percent from a year earlier. Late payments often foreshadow foreclosure.
Are the financial ramifications of all of the government intervention making you feel queasy?
Then try a little governmet “queasing…….”
Word of the Day: Queasing | The Big Picture
Queasing n. British slang for “quantitative easing,” the UK’s policy of printing money to stimulate the economy. The US is doing much the same thing, but Fed chair Ben Bernanke calls it “credit easing”—and so far pundits haven’t spun “creasing” into the vernacular.
So what’s the biggest challenge right now?
by Tom on June 29, 2009
in Market Musings
I think the graph that Calculated Risk put together shows what the biggest challenge is right now.
JOBS
There are other reasons that people fall behind on their payments, but the biggest reason and therefore the thing that our elected officials should be the most concerned about is jobs. If people are making a decent living the majority of them will be able to make their payments. If they are getting laid off by the thousands and thousands every week, many of them aren’t going to be able to make their payments.
It’s all about JOBS and what is our government arguing about lately?
Tom Vanderwell
Mortgage Market Update
by Tom on June 29, 2009
in Market Musings, Market Report, Mortgage Rate Updates
Well, here we are on the Monday before the Fourth of July. What should we expect for the week?
- As the week progresses, expect to see the moves and the volatility on Wall Street get more and more accentuated. Why? Because there will be more and more of the people who are left on Wall Street are going to be heading out early for the 4th of July weekend. So the trades that are there will make the market act “strangely.”
- The Chinese government came out over the weekend and basically said, “We don’t have any plans to change our buying habits of Treasuries.” The market at first said, “Yeah!” Then they read the speech more closely and saw that the Chinese government official used the term, “drastic” in reference to changing plans. In other words, “We aren’t going to change our plans tomorrow. Does that mean that they are leaving the door open for changing later? Stay tuned, the China saga isn’t over yet.
Rates have hardly changed at all this morning. My recommendation remains to lock all loans. Here’s why:
- The China “factor” is an unknown but it’s almost certainly going to be either a non-factor or something that pushes rates higher.
- The fact that the Fed said that they don’t see deflation as an issue means that more than likely the opposite of deflation is more likely to come into play. Remember, interest rates don’t react kindly to inflation.
See below for some “samples” of the rates I’m quoting today. I’ll keep in touch,
Tom Vanderwell
Purchase, Owner Occupied, 30 year fixed, $417,000 loan amount, 80% loan to value, 5.125% with 0 pts, or 4.875% with 1.125 pts. 30 day lock.
Purchase, Investment Property (1-4 unit), $125,000 loan amount, 75% loan to value, 6.25% with 0 pts or 5.75% with 1 pt. 30 day lock.
APRs are available upon request
Did CRA cause the meltdown?
by Tom on June 29, 2009
in Market Musings, banks
An interesting read by Barry Ritholtz on whether the CRA had any impact on the economic meltdown that we’re currently in. A couple of highlights:
- For those who aren’t familiar with it, the Community Reinvestment Act was legislation that “forced” banks to do loans in less well to do areas of town. Since many of these areas had people who weren’t as financially affluent, they ended up loosening their guidelines so that the loans could get done.
- While I agree with Barry’s reasoning of what things would look like if CRA was the “at fault” character in this mess, I don’t agree with his reasoning that CRA has nothing to do with it.
Did CRA cause the problems? Nope. Did the loosening of regulations to meet social and political guidelines get its start through the CRA? I think it did.
How’s a good way to put it? CRA pushed the door open for the rest of the barnyard animals to push their way through……
Tom Vanderwell
CRA Thought Experiment | The Big Picture
Given how thoroughly the “CRA caused everything” meme has been debunked, you have to wonder why some poor souls are still pushing this discredited political talking point (other than as linkbait).…….In reality, the precise opposite of what a CRA-induced collapse should have looked like is what occurred. The 345 mortgage brokers that imploded were non-banks, not covered by the CRA legislation. The vast majority of CRA covered banks are actually healthy.
Saturday Night Credit……
