Decision on Fannie and Freddie May Come Soon
Government and banking experts meet next week to decide the future of Fannie Mae and Freddie Mac.
The likeliest solution is a complex one. The Mortgage Bankers Association is proposing a system where risk-based fees on a class of mortgage-backed securities would be charged in exchange for a government guarantee against losses.
Whatever the outcome, it is unlikely that Fannie and Freddie will be able to pay back the nearly $150 billion in taxpayer bailout money that they have received since 2007.
Source: Reuters News (08/12/2010)
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Mortgage Applications Decline for 8th Week
Applications for mortgages to purchase property declined again last week, falling eight out of the last nine weeks, according to the Mortgage Bankers Association.
The purchase index decreased 2 percent last week compared with the previous week on an adjusted basis. The unadjusted purchase index declined 2.3 percent and was down 34.7 percent compared to the same week a year ago.
“For the month of June, purchase applications declined almost 15 percent relative to the prior month, and were down more than 30 percent compared to April, the last month in which buyers were eligible for the tax credit,” said Michael Fratantoni, MBA’s vice president of research and economics.
With mortgage rates at record lows, applications to refinance existing mortgages increased 9.2 percent from the previous week.
Mortgage rates were at near-record lows:
· 30-year fixed-rate mortgages increased to 4.68 percent from 4.67 percent;
· 15-year fixed-rate mortgages increased to 4.11 percent from 4.06 percent;
· 1-year ARMs increased to 7.20 percent from 7.05 percent.
Source: Mortgage Bankers Association (07/07/2010)
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MBA Plan to Help Jobless Pay Mortgage
The Mortgage Bankers Association outlined a plan Wednesday that would help the unemployed pay their mortgages for up to nine months.
The MBA proposed that loan servicers reduce borrowers’ monthly payments to no more than 31 percent of their household income with the arrears added to the back-end of the mortgage.
The association asked the Treasury Department to underwrite the program by providing loans to loan servicers to cover the payments.
“Borrowers with such a precipitous drop in income can’t qualify for most loan modification programs, so we are looking for ways to allow those borrowers to keep their homes while they look for another job,” said John Courson, CEO of the association.
Source: CNNMoney.com, Tami Luhby (02/24/2010)
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Bankers: The End of Foreclosure Crisis is Near
The Mortgage Bankers Association is seeing signs that the foreclosure crisis is ending.
“The continued and sizable drop in the 30-day delinquency rate is a concrete sign that the end may be in sight,” says Jay Brinkmann, MBA’s chief economist, in a published statement.
Brinkmann said that normally there is a large spike in short-term mortgage delinquencies at the end of the year because of high heating bills and holiday expenditures. This year, there was not only no spike, but the 30-day delinquency rate actually fell from 3.79 percent to 3.63 percent.
Thirty-day delinquencies have historically been a leading indicator of serious delinquencies and foreclosures, Brinkmann said.
“[This] gives us growing confidence that the size of the problem now is about as bad as it will get,” he said.
Source: Mortgage Bankers Association (02/19/2010)
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Mortgage Volume Rises Slightly
Mortgage applications were up 0.3 percent last week compared to the previous week on both a seasonally adjusted basis and on an unadjusted basis, according to the Mortgage Bankers Association weekly survey.
The increase was in refinances, which rose 0.9 percent. As a share of mortgage activity, refinances hit 74.4 percent, the highest refinance share since April 24.
The purchase index decreased 0.1 percent on an adjusted basis and declined 3.6 percent on an unadjusted basis. It was 15.4 percent lower than it was the same week last year.
Some mortgage rates were higher last week compared to the previous week:
* 30-year fixed-rate mortgages increased to 4.92 percent from 4.88 percent.
* 15-year fixed-rate mortgages remained flat at 4.33 percent.
* 1-year ARMs decreased to 6.52 percent from 6.55 percent.
Source: Mortgage Bankers Association (12/16/2009)
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Refinancing Drives Mortgage Activity
Mortgage activity rose last week to the highest level in about two months, mainly from borrowers locking in low mortgage rates by refinancing, the Mortgage Bankers Association said on Wednesday.
Nearly three of every four loan requests last week was for a refinancing rather than a purchase, the industry group said. Total mortgage applications, based on the group’s seasonally adjusted market index, rose 8.5 percent to 665.6, the highest since early October.
Demand for loans to buy a home increased by 4.0 percent to 241.5, the highest since the last week of October, while refinancing applications jumped 11.1 percent to 3,185.9 last week to a two-month high, the industry group’s indexes showed.
Average 30-year mortgage rates rose 0.09 percentage point to 4.88 percent but haven’t moved much from all-time lows.The rate was down from 5.44 percent a year ago and compared with a record low of 4.61 percent set in March, according to the Mortgage Bankers Association.
Source: Reuters, Mortgage Bankers Association (11/9/2009)
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Mortgage Rates Creep Back Up
After last week’s decrease to a record 4.71 percent, interest on 30-year fixed mortgages rose to 4.81 percent this week, Freddie Mac reported.
While the Federal Reserve’s effort to purchase $1.25 trillion in mortgage-backed securities issued by Fannie Mae, Freddie Mac, and Ginnie Mae has helped keep rates attractive, Freddie Mac chief economist Frank Nothaft says they rose because a favorable unemployment report pushed long-term bond yields up slightly.
With the Fed program projected to end in March, the Mortgage Bankers Association forecast in October that 30-year fixed mortgages will rise to 5.4 percent next year, increase to 6 percent in 2011, and hit 6.3 percent in 2012.
Source: Inman News (12/11/09)
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Mortgage Applications Rise Over Thanksgiving
Mortgage applications rose last week, according to the Mortgage Bankers Association weekly survey.
On a seasonally adjusted basis, mortgage loan applications increased 2.1 percent compared to the previous week. The seasonally adjusted purchase index increased 4.1 percent from the previous week, while the refinance index rose 1.7 percent.
On an unadjusted basis – reflecting the Thanksgiving holiday – the purchase index decreased 30.4 percent compared with the previous week and was 34.9 percent lower than it was the same week a year ago.
Mortgage rates continued to decline, with 30-year fixed rates reaching their lowest level since May.
30-year fixed-rate mortgages decreased to 4.79 percent from 4.82 percent;
15-year fixed-rate mortgages decreased to 4.27 percent from 4.32 percent;
1-year ARMs decreased to 6.56 percent from 6.66 percent.
Source: Mortgage Bankers Association (12/02/2009)
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Application Index for Purchases Falls
Mortgage applications rose 3.2 percent on a seasonally adjusted basis last week compared with the previous week, but most of the increase was in refinances.
The seasonally adjusted purchase index declined 11.7 percent from the previous week and is at its lowest level since December 2000. On an unadjusted basis, the purchase index fell 13.7 percent compared with the previous week and was down 21.6 percent compared to the same week a year ago.
The refinance index increased rose 11.3 percent and represented 71.5 percent of total applications.
Overall, interest rates declined:
* 30-year fixed-rate mortgages decreased to 4.90 percent from 4.97 percent.
* 15-year fixed-rate mortgages remained unchanged at 4.33 percent.
* 1-year ARMs increased to 6.85 percent from 6.83 percent.
Source: Mortgage Bankers Association (11/12/2009)
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Small Mortgage Banks Band Together
Scores of independent mortgage banks have closed their doors over the past two years due to the challenges of obtaining short-term credit, and two new trade groups have been established in response.
The Community Mortgage Lenders of America and the Community Mortgage Banking Project both plan to lobby on behalf of local mortgage banks and lenders not owned by large banking companies, insisting they are necessary for a competitive market and holding down rates and fees.
John Courson, CEO of the Mortgage Bankers Association, says his group advocates a “level playing field” for all lenders and is taking steps to keep independent lenders in business.
Source: Wall Street Journal, James R. Hagerty
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Mortgage Bankers: End Fannie and Freddie
The Mortgage Bankers Association is urging the U.S. government to replace Fannie Mae and Freddie Mac with private companies.
The Obama administration is considering a couple of options, including shutting them down or merging them into another federal agency.
The mortgage bankers would replace Fannie and Freddie with federally regulated private companies that would buy loans, sell them as bonds with their own guarantee, and pay the government for reinsurance.
Jaret Seiberg, an analyst at Washington Research Group, said in a research note that the “odds are high for enactment” for the Mortgage Bankers Association’s proposal because this would create a practical way to keep mortgage rates low.
Source: The Associated Press, Alan Zibel (09/02/2009)
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Loan Volume Rises Again, Driven by Refinances
Loan application volume rose again last week, increasing 7.5 percent on a seasonally adjusted basis compared to the previous week, the Mortgage Bankers Association reported.
On an unadjusted basis, the index increased 6.3 percent and was up 34.1 percent compared with the same week a year ago. This is the fourth consecutive week mortgage application volume has risen.
The increase was driven by refinances, with the refinance index increasing 12.7 percent from the previous week. The purchase index rose 1 percent with nearly all the increase coming from applications for government loans.
Mortgage rates rose slightly but the increase didn’t seem to deter applicants:
* 30-year fixed-rate mortgages increased to 5.24 percent from 5.15 percent.
* 15-year fixed-rate mortgages increased to 4.58 percent from 4.52 percent.
* 1-year ARMs increased to 6.74 percent from 6.66 percent.
Source: Mortgage Bankers Association (08/26/2009)
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Mortgage Delinquencies Hit Record High
Mortgage delinquencies hit a record high in June with more than 13 percent of homeowners late with at least one mortgage payment or in foreclosure, according to a report released Thursday by the Mortgage Bankers Association.
“As a sign that mortgage performance is once again being driven by unemployment, prime fixed-rate loans now account for one in three foreclosure starts. A year ago, they accounted for one in five,” says Jay Brinkmann, the association’s chief economist.
Florida is at the top of the heap with a total of 22.8 percent of all mortgages delinquent by at least one payment or in the process of foreclosure. That’s twice the national percentage if the Florida numbers are excluded. The next highest states are Nevada, 21.3 percent; Arizona, 16.3 percent; and Michigan, 15.8 percent.
“It is unlikely we will see meaningful reductions in the foreclosure and delinquency rates until the employment situation improves. In addition, in some areas where a number of borrowers have mortgages that are larger than the current value of their homes, any life events such a divorce or loss of a job are likely to translate into foreclosures until prices in those areas recover, not just flatten,” Brinkmann said.
Source: Mortgage Bankers Association (08/20/2009)
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Mortgage Applications Bounce Back
Mortgage applications bounced back last week after nearly a month in the doldrums when the number of applications fell to a seven-month low.
The market index compiled by the Mortgage Bankers Association rose 6.6 percent on a seasonally adjusted basis to 548.2 points from 514.4 points the previous week.
On an unadjusted basis, the index increased 6 percent compared with the previous week and rose 17.2 percent compared with the same week a year ago.
Both purchases and refinances were up with the purchase share increasing 7.3 percent and refinances rising 5.9 percent.
Source: Mortgage Bankers Association (06/24/2009)
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When your mortgage application is rejected.
Don’t be surprised if your friendly lender, the one who invites you to sit down and apply for a mortgage, ushers you politely out the door empty-handed after you’ve chatted a bit.
The sudden chill isn’t personal. The Mortgage Bankers Association, or MBA, in Washington, D.C., estimates that about half of all mortgage applicants are now being turned down. Though refinancing approvals remained static, the acceptance rate on mortgage applications suffered a 10 percentage-point drop, from 63 percent in the first half of 2007 to 53 percent in the first half of last year, according to mortgage data tracked semi-annually by the association. Since then, further tightening of credit standards means at least half of mortgage-seeking consumers can’t squeeze through to acceptance, says MBA spokeswoman Carolyn Kemp. Full Story.
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When your mortgage application is rejected.
Bankrate.com updated 3:14 p.m. ET, Sun., March. 22, 2009 Don’t be surprised if your friendly lender, the one who invites you to sit down and apply for a mortgage, ushers you politely out the door empty-handed after you’ve chatted a bit. The sudden chill isn’t personal. The Mortgage Bankers Association, or MBA, in Washington, D.C., [...]