Will Foreclosure Sales Slow Because of New Title Company Policies?

Foreclosure Sales Slowed By Title Company Policies
First American Financial, Fidelity National Financial, Old Republic, etc., are all publicly held title companies. I mention this a) because there is some conjecture that the share price of title companies may suffer, given the current foreclosure “hubbub”, and b) Old Republic won’t write new policies for homes foreclosed upon by Chase and Ally Financial’s GMAC Mortgage unit—a sign that concerns about faulty foreclosure paperwork could now endanger new sales of foreclosed homes. FNF, for one, believes that this situation will not have a material adverse impact on its title business. FNF’s title insurance underwriters issue title policies on REO properties to new purchasers and lenders to those purchasers, and these policies will not result in additional claims exposure to the title company because the new owners and their lenders would have the rights of good faith purchasers which should not be affected by potential defects in documentation.

Economic Stat Recap Last Week
Last week, in spite of some volatility, rates closed about where they began. Just think – all that nervousness about when to lock was probably for naught. On Friday, even though we didn’t have the employment data as we usually do on the first Friday of a month, we did have Construction Spending. It showed an unexpected rise of .4% in August, and July was revised higher. That would explain all the streets being torn up near where I live. We also learned that the ISM Manufacturing Index decreased from a month earlier. “Manufacturing has enjoyed a stronger recovery than other sectors of the economy, but it appears that weaker growth is the expectation for the fourth quarter.” And the University of Michigan Consumer Sentiment survey dropped from August to September more than expected. (Is that really someone’s job? To predict the results of this survey? How do you explain that to your kids?) We ended the day better by about .125, with minimal mortgage banker supply (less than $1 billion) and decent buying.