Loan modifications, which seem to have more of an impact on the larger investors than on the smaller brokers, have come a long way since earlier this year. An assortment of modification programs have been almost entirely replaced by HAMP, now the industry standard for first liens, and servicers have streamlined, to a much greater
October 2009
Amazon.com WidgetsThe chatter about underwater homeowners “just walking away” from their debt deafens us at various intervals during this recession (here’s the latest from 1/7/10), and it’s hard to deny the rationale for walking away for certain specific cases. But recent favorable data can, just like negative foreclosure data, cause sentiment to change—in much the
“Keep skunks and bankers at a distance” so the old saying goes. Mortgage bankers may have to ignore that saying, however, given some National Mortgage News data that shows that four companies (Wells Fargo, Bank of America Home Loan, JPMorgan Chase, and Citigroup) control almost 58% of the overall lending market. Wells was the largest
Today is the 30th anniversary of the Fed rate system as we know it. After their October 6, 1979 FOMC meeting, the Fed announced a drastic change to monetary policy. Up until that time the money supply fluctuated with business cycles and rates were relatively fixed—the Fed Funds Rate was only allowed to float about
As discussed last quarter, FHA loans have become the most viable way for borrowers with less than 20% down to buy a home. Single family home FHA loans are fairly straightforward. Rules for condo FHA loans have recently changed, and it’s critical for any homebuyer targeting condos up to a price point of $850k and
The loan limits that make it possible for high-cost markets like the Bay Area and Los Angeles to have conforming loans up to $729,750 are set to expire December 31, and the $8000 tax credit available to homebuyers expires November 30. As of this writing on October 5, there’s been no indication as to whether
The other day my boss commented that, “If every employee contributed half of their life savings to our firm, we’d be on the road to profitability!” I knew things were getting tough when they replaced “Bring Your Child to Work Day” with “Bring Your Child to do Work Day”. On the other hand, the margarita
In a market report last quarter, we buried a quotation that’s worth revisiting. It was from investment luminary Dean Witter in May 1933, about 3.5 years after the Great Depression began. He said: “Some people say they want to wait for a clearer view of the future. But when the future is clear, the present
The financial crisis that began in August 2007 and continues today (October 2009) has—at least for now—brought consumer banking back to “savings and loan” basics. Up to the 1980s, before loan securitization found its footing, consumer banking was community focused, bank reps knew their clients’ current and projected finances intimately, and funded home loans from
RATE/MARKET UPDATE Rates dipped this week, entering a seventh week of being either down or even. The dip was caused by tame inflation data and a much weaker than expected jobs report showing the economy shed -263k jobs and hit a 9.8% unemployment rate. But the rate dips came before today’s jobs report and rates
The scene from this movie was obviously a horrible period in history, but this take on it cracks me up every time: My uncle used to say, “Do not corner something that you know is meaner than you.” Or bigger, for that matter. Speaking of big, the numbers yesterday show that the Fed’s purchases dipped
The Bureau of Labor Statistics non-farm payroll report showed that the economy lost 263,000 private sector jobs in September. This is the 21st straight month of losses, putting the job loss toll since January 2008 at 7.21 million, with 4.13 million of these job losses occurring in 2009. After six straight months of losses greater
Overall Personal Consumption Expenditures, the Fed’s favorite measure of consumer inflation, were 0.3% in August and -0.5% year-over-year through August. Excluding volatile oil and food costs from the readings, “Core” PCE price index for August was +0.1% and +1.3% YOY through August. The Fed looks closely at Core PCE excluding food and energy prices because
“Most of the stuff people worry about ain’t never gonna happen anyway.” But in this case, I bet a change will be made. Everyone knows the drill: small originators sell loans to mid-tier investors such as AmTrust or Franklin American, who in turn sell their loans to companies like Wells, Chase, Bank of America, or
“Most of the stuff people worry about ain’t never gonna happen anyway.” But in this case, I bet a change will be made. Everyone knows the drill: small originators sell loans to mid-tier investors such as AmTrust or Franklin American, who in turn sell their loans to companies like Wells, Chase, Bank of America, or