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Mortgage News Daily

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Mortgage Rates Drop to Lowest Levels in 2 Weeks
'); document.write('Posted To: Mortgage Rate WatchThis week hadn\'t been too traumatic for mortgage rates through yesterday afternoon, but neither had it been positive in any noticeable way. That changed today as rates fell abruptly to the lowest levels since last Monday. Granted, at the time, last Monday\'s rates were still pretty close to the worst in 7 years, but the point is that we\'ve managed to find our way back from the even higher rates that followed. Help came chiefly from European political developments where Italy is a day or two away from confirming a government that could end up pushing the country out of the Eurozone . Even though that\'s far from guaranteed, the mere risk of such a thing is enough to drive investors toward safer haven bonds like those issued by Germany or the US. In general, excess demand for bonds means rates...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
Houses Passes S2155, Unwinds Less of Dodd-Frank Than Hoped
'); document.write('Posted To: MND NewsWireThe House of Representatives passed a sweeping overhaul of regulations included in the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act on Tuesday. Senate Bill 2155, which passed the upper house in March, received a 258 to 259 vote in the House. It now goes to the White House for what is expected to be certain presidential approval. The bill did not go nearly as far as the House had hoped in rolling back Dodd-Frank. Leadership agreed to vote on the compromise bill negotiated in the Senate between Republicans and Democrats only after a promise of a vote latter this year on other changes House members, especially House Financial Services Chair Jeb Hensarling (R-TX) were demanding. According to Bloomberg, the legislation gives smaller banks relief from post-crisis rules that they...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
New Home Sales Continue to Improve on Annual Basis
'); document.write('Posted To: MND NewsWireNew home sales dipped in April, a reversal that was expected by many analysts . The U.S. Census Bureau and the Department of Housing and Urban Development said sales of newly constructed homes during the month were at a seasonally adjusted annual rate of 662,000 units. This is 1.5 percent below the revised rate of 672,000 units in March. The March estimate was revised down from 694,000 units, erasing much of that month\'s reported 4 percent gain. Despite the downturn, sales are now running 11.6 percent above the April 2017 estimate of 593,000 sales. In March the year-over-year gain was reported at 8.8 percent. Analysts polled by Econoday had expected sales to be in the 650,000 to 692,000 range. The consensus was 677,000. On a non-seasonally adjusted basis there were 64,000 new homes sold in...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
Freddie Mac to Address Origination Barriers for Young Buyers
'); document.write('Posted To: MND NewsWireReams of data have been gathered about what appear to be significant changes in the profile of younger homebuyers and consequently mortgage borrowers. This usually means the Millennial generation, but recently Gen Z, those born in 1995 and later have begun moving into homeownership as well. A recent report by Freddie Mac says the Millennials came of age after the housing crisis and since home prices bottomed out, rents have increased an average of 20 percent. \"It\'s not easy to save up for a down payment when you\'re pouring you money into rapidly escalating rents.\" And even those who do have savings, may have difficulty convincing a bank they have the necessary income to qualify for a loan: Increasingly, millennials don\'t have only one on-payroll job and a W-2 to show income. Add to that the...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
Lender Products; Congress\' Take on TILA, PACE Loans, and MLO Licensing
'); document.write('Posted To: Pipeline PressEvery vendor here at the MBA conference suggests they can help clients close more loans faster, more efficiently and compliantly. If only all these lenders had more loans in their pipelines to close! But lenders here in NY are an optimistic bunch. Lender Products Yesterday at the MBA Secondary conference in New York, Mortgage Coach and Optimal Blue announced an enhanced integration that avails access to accurate pricing within the Mortgage Coach platform. Now every Mortgage Coach-powered loan originator can include real-time product and pricing data within the Total Cost Analysis – in seconds without ever leaving the Mortgage Coach app – giving their borrowers the transparent and accurate loan options they need to make a confident mortgage decision faster. “Combining the sophisticated...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
MBS Day Ahead: Italian Impact Continues, Helping Bonds Start Strong
'); document.write('Posted To: MBS CommentaryI woke up this morning to an automated alert from MBS Live letting me know I'd need to hustle to the desk and explain whatever it was that caused the friendly spike more than 6bps lower in 10yr yields (all the way down to 3.0%). The safest bet was that it was something to do with Italy, and my chart of Italian spreads vs German Bunds didn't disappoint. Equities markets happened to be playing ball as well. It's been a good morning to be a safe-haven US Treasury bond (especially longer duration bonds like 10 and 30yr securities). The net effect on the bigger picture for the US bond market is that it sets us up to challenge the important 3.05-3.06% floor (obviously). In fact, it gives us a huge head start for the day. Remember the lessons from bonds 2-3 weeks ago though. As we attempted...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
Refinance Applications Near 18-Year Low
'); document.write('Posted To: MND NewsWireMortgage rates surged significantly during the week ended May 18, sending mortgage activity skidding for the fifth straight week . The Mortgage Bankers Association (MBA) says its Market Composite Index, a measure of mortgage loan application volume, dropped by 2.6 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis there was a 3 percent decline. The seasonally adjusted Purc h ase Index decreased 2 percent from one week earlier. The unadjusted Purchase Index decreased 3 percent compared with the previous week but remained 3 percent higher than the same week in 2017. Refinance activity hit a near 18-year low . The Refinance Index declined another 4 percent compared to the previous week, to its lowest level since December 2000. Refinancing also continues to lose...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
MBS RECAP: Bonds on Autopilot Ahead of Fed Minutes and Treasury Auction
'); document.write('Posted To: MBS CommentaryFor the 2nd straight day , trading levels in bond markets held inside a narrow range--far narrower than that seen on any given day last week, let alone the entire week. This could be incidental or it could be in anticipation of some future event. The leading candidates as far as future events would be tomorrow's release of the Fed Minutes at 2pm as well as the first serious Treasury auction of the week (5yr Notes at 1pm). Given that the bigger of the two events hits an hour later, that's where we'd be looking for intraday risk-- at least it would be if we were in a more normal environment. As it stands, the bond market is exceptionally well availed of the Fed's plans and it's unlikely that new information is going to be gleaned from this or any near-term release. The only...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
Mortgage Rates Super Flat So Far This Week
'); document.write('Posted To: Mortgage Rate WatchAfter quite a bit of volatility and a move up to 7-year highs last week, mortgage rates have managed to avoid any semblance of drama so far this week. In fact, each of the past 2 days has seen the average lender keep 30yr fixed rates perfectly in-line with Friday\'s latest levels. The worst that could be said of these rates is that they\'re very close to last week\'s highs. The second worst thing that could be said of these rates is that they\'re the latest in a series of gradual moves higher over the past few years. The general expectation is that rates can continue to move higher as long as the economy continues to tolerate higher borrowing costs. Mortgage lenders know that we are now in a rising rate environment. That means they\'re less likely to offer huge improvements on rate sheets unless...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
Increasing Number of Homes Built as Rental Property
'); document.write('Posted To: MND NewsWireAs if the new home inventory wasn\'t tight enough, the National Association of Home Builders (NAHB) say a higher proportion of those homes are being built as rentals rather than owner occupancy . Robert Dietz, writing in NAHB\'s Eye on Housing blog says the numbers are small, but the increase has continued for several recent quarters. From the first quarter of 2017 through the first three months of 2018, construction starts for homes built specifically as rental property rose from 33,000 to 37,000. Seven thousand of those starts were in the first quarter of this year. According to Census Bureau estimates, the market share of single-family homes built to be rented (and not including those built and sold to someone who then rents them out) accounted, on a one-year moving average basis, for 4.3...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
Nullification of Auto Loan Rule Has Broad Implications
'); document.write('Posted To: MND NewsWireIt only impacts auto lending, but if Mick Mulvaney, acting director of the Consumer Financial Protection Agency (CFPB) keeps his word, a Congressional resolution signed by the President on Monday is likely to have an eventual impact on mortgage and other lending as well. The Joint Resolution, S.J. Res. 57, sponsored by Senator Jerry Moral (R-KS) and Rep Lee Zeldin (R-N.Y.) used the Congressional Review Act (CRA) to formally disapprove a rule from CFPB relating to \"Indirect Auto Lending and Compliance with the Equal Credit Opportunity Act\"(ECOA). This causes that rule to \"have no force or effect.\" Some background, and because today there always seem to be two various of facts, we summarize the story from both perspectives, that of the National Auto Dealers Association (NADA) and of The Leadership...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
MBS Day Ahead: The Biggest Risk to Fledgling Bond Bounce
'); document.write('Posted To: MBS CommentaryToday begins the 3rd day where US Treasuries aren't imploding after hitting 7 year highs last Thursday. At this point, we might consider the resilience to be some sort of fledgling bounce attempt, even though we can continue to be concerned about technical floors (discussed here ). But let's say that 3.06% is convincingly broken today and confirmed tomorrow. Then what? If that happens, I will be looking squarely at the Italian political drama and European bond markets. What follows is a bit of an outline for a more robust primer on the topic of European bond markets as they interact with US bond markets. Does rate volatility in Europe really affect US rates? There can be no greater proof of this than the summer of 2012, when the EU debt crisis was at its apex. There's no way we...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
Lender Products; State-Level Changes; Does the Yield Curve Matter?
'); document.write('Posted To: Pipeline PressThe U.S. mortgage industry likely recorded an operating loss in the first three months of 2018 due to falling loan volumes and growing expenses, the Mortgage Bankers Association’s chief economist, Michael Fratantoni, said yesterday here in New York. On a personal note, I know many owners and CEOs of residential lenders, however, and would never bet against their success. They represent a very savvy, entrepreneurial, and street-smart group of individuals but are faced with many risks, with LO comp, technology, housing inventory, and shrinking margins in the forefront. Check out The Plight of the Small Independent Lender . Company News Saturday this commentary mentioned that bitcoins were not suitable for a down payment in Fannie’s guidelines. David T. showed me that there are state...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
MBS RECAP: Bond Yields Struggle to Break Last Week\'s Floor
'); document.write('Posted To: MBS CommentaryThere were no significant economic reports or events today, and only a few newsworthy developments. The biggest of these also happened the earliest (yesterday night, in fact) when the White House announced the suspension of certain tariffs on China. Stock futures liked the news (after all, the threat of a trade war has been a big deal), but bonds didn't react much. As the overnight session progressed, a familiar trade took shape in European bond markets with core yields continuing to rally. Whereas that had been helpful for US bond markets on Friday, they were less responsive today. Both before and after the European rally, US yields approached and bounced at the 3.06% technical level (to be fair, it's more like 3.055%). This is right were bonds ran into resistance on Friday afternoon...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
Mortgage Rates Unchanged to Begin Week
'); document.write('Posted To: Mortgage Rate WatchMortgage rates held steady today, which is better than what could be said for most of last week when rates shot up to the highest levels in 7 years. Friday was the only day of improvement, but it was scarcely enough to undo the damage from the previous 4 days. That said, it did raise questions. Specifically, was Friday some sort of indication that the worst was behind us in terms if upward rate momentum? Answering that question is tricky business because the time frame matters greatly. In the short term, there\'s always a possibility that a prevailing trend toward higher rates will cool-off and reverse course. While that\'s also technically possible over longer time horizons, we can begin to talk more about probabilities and less about random chance. With that in mind, we\'ve be discussing the...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
Will \"Freeing\" Fannie/Freddie Improve Housing Finance?
'); document.write('Posted To: MND NewsWireIn a prior article we summarized the options the Trump Administration might utilize to reform the residential mortgage financing system should Congress continue to drop the ball. Two noted economists, Jim Parrott and Mark Zandi, writing for the Urban Institute, address the notion of shrinking Fannie Mae and Freddie Mac\'s (the GSEs) footprints and eliminating their cross-subsidy of higher risk borrowers. This article summarizes their alternatives for ending the 10-year government conservatorship of the two companies. The director appointed to replace Melvin Watt when his term as director of the Federal Housing Finance Administration (FHFA) expires next year will undoubtedly reflect the attitudes of the Administration including their claimed commitment to changing the GSEs\' status. The authors...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
Lenders: Income Verification Needs for \"Gig\" Economy
'); document.write('Posted To: MND NewsWireLate last year Fannie Mae included questions in one of its National Housing Surveys about working in the \"gig\" economy. About a fifth of respondents claimed they earned at least some of their income through such employment. Gig-economy workers tend to have flexible work arrangements, working on single projects or tasks preforming on-demand services such as transportation (Uber, Lyft) lodging rental (Airbnb and VRBO) food/goods delivery, and personal tasks (TaskRabbit). Because of its \"on-demand\" nature, the income stream from gigging can be less stable and its source less reliable . With the numbers involved increasing, this is likely to become an issue in mortgage lending, so Fannie Mae\'s Economic and Strategic Research (ESR) group included some self-employment and gig-economy related questions...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
Automated Construction - Robot Frames Small Home in Two Days
'); document.write('Posted To: MND NewsWireLast week the National Association of Home Builders (NAHB) reported that severe shortages of construction tradespeople were slowing homebuilding and increasing costs. The shortages, as reported by NAHB\'s new home builder members, affected all trades from rough carpenters to plumbers and masons. Now, from Australia, comes news that brick masons at least may not have as much job security as that NAHB report would suggest. The Hadrian X, developed by Perth-based Fastbrick Robotics, can lay more than 1,000 bricks an hour and, in tests, has framed a small home in two days. Hadrian, essentially a long robotic arm that can be mounted on a track, crane, or barge, uses a 3-D model of the house, cuts its own bricks, applies adhesive, then conveys them to the arm which puts them in place. The plumbing...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
MBS Week Ahead: Holiday-Shortened Week. Time For Consolidation?
'); document.write('Posted To: MBS CommentaryMuch like last week , this week's event calendar is limited in terms of top tier data and events, but nonetheless carries the potential for technical momentum. The underlying reasons are a bit different , however. Last week, the risk was that rates had been super flat and narrow for 2+ weeks. The longer and narrower those sideways streaks become, the more likely a breakout becomes (obviously), and those breakouts tend to have more momentum than normal. This week's set-up is somewhat similar to the highs in rates seen at the end of April. In both cases, we'd just spiked to the highest rates seen in a long time and then saw one really solid day of improvement. In the late-April case, it was that day of improvement that preceded the sideways drift. In this week's case, today would...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
Digital, Capital Markets Products; Regions Exits Correspondent
'); document.write('Posted To: Pipeline PressHello from the MBA Secondary Conference in NY! Lenders are talking about LO comp (“they need to share the margin pain, but no one wants to be the first to outright cut it”) and Amazon…but anyone afraid of Amazon creating a mortgage company should learn a little something about it. For example, Amazon is relentless regarding the customer experience, even if it cuts into short-term results. Every employee, including CEO Jeff Bezos, spends at least two days a year working in the call center or sales department. This ensures a companywide understanding of customer satisfaction and it might be an interesting idea for bankers to consider. How much time does a lender’s CEO spend on the phone with borrowers, processing, or servicing loans? Lender Products Join this week’s...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
MBS RECAP: Nothing to be Mad About, But...
'); document.write('Posted To: MBS CommentaryBonds rallied today for the first time all week, and fairly well at that! 10yr yields fell more than 5bps and Fannie 3.5 MBS rose nearly 3/8ths of a point. Not much to be mad about there, right? Indeed, there's nothing to be mad about , but there are all sorts of reasons to remain cautious. The rally was driven by a combination of European political drama and short-covering in US bond markets. Here's an external link that does a better job than I can of explaining the Eurodrama quickly. And here's a homegrown link the goes into greater detail on short-covering. The day's best gains were seen during the 2nd half of the European session (which effectively ends at noon ET), but short-covering kept the positive trend intact through the domestic close. To reiterate what I said earlier...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
Temporary Factors Help Mortgage Rates... Temporarily
'); document.write('Posted To: Mortgage Rate WatchMortgage rates caught some small semblance of a break today. If it\'s not apparent based on that assessment in conjunction with the headline, the improvements certainly left something to be desired, even though that\'s to be expected, given the circumstances. Here\'s what I mean by that: Rates are based on the bond market. Trading levels in the bond market are back in line with (or slightly better than) Tuesday\'s levels. But mortgage rates are still higher than those seen on Tuesday. It\'s really that simple. Why is it to be expected? Mortgage rates aren\'t created automatically based on the bond market. The bond market is merely the primary input. Lenders use bond prices/levels as a baseline for determining rates. If the market has been more volatile, lenders are quicker to raise rates and slower...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
MBS Day Ahead: What Is a Short Squeeze And How Could It Help Us?
'); document.write('Posted To: MBS CommentaryThe notion of "positions" is extremely important to the bond market (and to any market for that matter). At the most basic level, a LONG position seeks to profit from prices rising (or yields falling) and a SHORT position seeks to profit from prices falling (or yields rising). Quite often, the structure of accumulated positions in the Treasury market acts as its own driver of momentum . The key reason for this is the very logical practice of traders protecting themselves from undue losses with automatic trades unsurprisingly known as "stop losses" or simply "stops." For instance, if the market is overly long, and if a big chunk of longs were set-up around a specific trading level, if yields happen to move higher than that trading level (or something close to it...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
Subservicing, Compliance, and Warehouse Products; Private Mortgage Insurance Trends
'); document.write('Posted To: Pipeline PressFolks heading to the MBA’s Secondary conference should know that there are 329 street-level newsstands in New York City. (The peak was 1,500 in the 1950s.) By law, the maximum price for anything at a newsstand is $10, meaning that newspapers are a significant part of that business. Finance & news about it make the world go ‘round, and thanks to Steve A. for passing along a new essay where Pope Francis calls for intensified regulation of the \"sophisticated technologies\" of financial markets. Private Mortgage Insurance News “The Community Home Lenders Association (CHLA) writes to ask FHFA to investigate the pricing practices of private mortgage insurers (PMIs) with respect to use of volume discounts and other proxies for this in the offering of mortgage insurance for Fannie...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('
NAR Curtails Earlier Home Sales Estimates
'); document.write('Posted To: MND NewsWireIn the face of continuing inventory shortages, declining consumer sentiment in favor of buying a home, and concern about the homeownership impacts of the 2017 tax cut bill, the National Association of Realtors® (NAR) has revised down, albeit only slightly, its forecast for home sales this year. Chief Economist Lawrence Yun told Realtors attending NAR\'s Legislative Meetings & Trade Expo that, after accelerating 3.8 percent in 2016, existing home sales rose only 1.1 percent to 5.5 million in 2017. He forecasts they will finish this year around 5.6 million, a gain of 1.8 percent. In his initial 2018 forecast last November Yun said he expected sales to increase by 3.7 percent to 5.67 million units. Looking further into the future, he sees 2019 sales totaling 5.7 million existing homes....(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.'); document.write('