Category Archives: Home builders

Issuers Warned to Keep Prepayment Speeds in Line or Risk Sanctions

Posted To: MND NewsWire

A small group of VA approved issuers have been warned that the speed at which their loans are being prepaid makes it appear they are participating in “churning.” Ginnie Mae said on Thursday that the issuers who have been notified are expected to deliver a corrective action plan that identifies immediate strategies to bring prepayment speeds in line with those of loans issued by their peers. In January, a Ginnie Mae official testified before hearing of the House Committee on Veterans Affairs about loan churning. He told committee members that, starting in early 2016, the agency, as well as investors in its mortgage backed securities (MBS), began to note that loan prepayment rates and serial refinancings were occurring with unusual frequency among VA mortgages. Some of the prepayments were at…(read more)

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MBS RECAP: How To Win Friends By Humiliating Them Publicly

Posted To: MBS Commentary

Everyone likes an intellectual bully, right? Well, not really, but everyone likes the person that knows what’s up and isn’t shy about articulating facts in a calm but confident manner–especially when those facts run contrary to pervasive group mentality, right? OK, so maybe people don’t always like that person either, but odds are far better than the bully. At least we can agree that the ABILITY to be that person–even if you don’t feel compelled to go out and educate others–is useful, if for no other times than when people ask. And if those people happen to be potential mortgage clients, even better! With all of the above in mind, if you can see the video attached to this commentary, you are an MBS Live member, or they have forwarded you an email. If you keep up to speed…(read more)

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MBS RECAP: Bond Rout Resumes; Duck and Cover

Posted To: MBS Commentary

In the past or under different circumstances, a day like yesterday might not have been enough for me to write a headline like “nice while it lasted.” But if you watched yesterday’s video and read the analysis, you saw the chart showing the percent change comparison between stocks and bond PRICES (can’t look at percent change on a yield). That–along with me flat out saying it–implied we’d need a fresh supply of massive stock market drama in order to sustain further bond market improvement. We haven’t had a fresh supply of stock market drama. Instead, stocks have gradually been recovering from Monday’s rout, despite some bumps in the road. As such, it is time for the bond market rout to resume. This morning was a bit deceptive, with bonds technically starting in…(read more)

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MBS RECAP: Nice While It Lasted

Posted To: MBS Commentary

Yesterday’s massive stock market rout was enough to coax reluctant bond yields to the lowest levels since the end of January. Given that the end of January occurred a week ago today, that gives you an idea of just how lopsided the trend has been (i.e. a seemingly epic 14bp rally only gets you back to rates from a few days ago, and at the time, those rates were the highest in several years). The video in today’s MBS Live Huddle breaks down just how much movement it took in stocks to get the desired effect in bonds. The cliff notes are as follows: S&P futures fell more than 7% while 10yr futures prices (the best apples to apples comparison) rose less than 1.5%. In other words, bonds really didn’t show up to rally yesterday, and it was only the buckets of cash falling out of the…(read more)

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Mortgage Rates Catch a Break After Stock Market Rout

Posted To: Mortgage Rate Watch

Mortgage rates caught a break today, moving back near last Thursday’s levels as bonds (which underlie rates) benefited from today’s extreme market volatility. It’s a common misconception that interest rates and stocks always follow each other. While this is often true over shorter time horizons, the opposite tends to be true in the long run. Moreover, there are numerous examples of shorter-term moves that also suggest the opposite. As recently as last week, higher rates were being blamed for stock market weakness, but today’s sharp drop in rates did nothing to soothe the significantly sharper drop in stocks. The fact is that stocks have rallied to very high levels. They’ve been rallying for a very long time, and there’s been very little volatility recently. The longer that continued to be the…(read more)

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Builders See Strong 55+ Housing Market

Posted To: MND NewsWire

The aging of America seems to be stoking the enthusiasm of homebuilders about catering to the senior set. The National Association of Home Builders (NAHB) conducts a survey among its new home builders each quarter, similar to the monthly one it conducts to calculate its Housing Market Survey (HMI.) The quarterly survey however is focused on the over 55 housing market. NAHB reports that its fourth quarter 55+ HMI jumped 12 points to a record higher of 71. It was the 15 th consecutive quarter in which the index has exceeded 50, the break-even point at which more respondents view conditions as good than poor. As in the monthly survey, builders are asked to categorize their current perceptions of the market and their expectations for the next six months as good, fair, or poor. They are also asked…(read more)

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CRA Trends; Homeowner's Insurance and Title News; Subservicing Product

Posted To: Pipeline Press

The total number of slot machines in Las Vegas is down 23 percent from its peak in 2001, partially because slot gambling never really clicked with younger generations. But the casino business derives most of its revenue from the machines, so it’s looking into ways to get millennials interested in slots. Some people really like statistics, lists, and rankings. I mention this because Quicken Loans Inc. announced that it surpassed Wells Fargo & Co. in volume surpassed Wells Fargo & Co. in volume of mortgage originations in the fourth quarter of 2017. Quicken Loans reported Thursday that it originated $25 billion in home loans in the last three months of 2017, while Wells Fargo reported $23 billion in residential mortgages for the quarter. Thrilling and Chilling CRA News When I was…(read more)

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Health Care Construction a Big Winner in 2017

Posted To: MND NewsWire

Construction spending wound up the year with positive numbers for December and an increase in overall spending for the year . The U.S. Census Bureau tallied up the dollars spent for privately and publicly funded construction across all sectors at $1.231 trillion. This is a 3.8 percent advance over the $1.186 trillion spent in 2016. Overall construction dollars spend in December were estimated at a seasonally adjusted annual rate of $1.253 trillion, up 0.7 percent from November, and 2.6 percent higher than a year earlier. The year’s biggest gain was in health care construction , up 13.5 percent year-over-year, while construction for sewage and waste disposal lost the most ground, down 13.5 percent. On a non-seasonally adjusted basis, a total of $95.310 billion was spent on construction in December…(read more)

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MBS RECAP: Fed, SOTU Pass Without a Trace

Posted To: MBS Commentary

Stay skeptical about easy answers in financial news! Here’s a tremendous example. Much has been made of the stock market being on the edge of a massive correction based on rising interest rates. That’s not necessarily a bad idea, but it is faulty logic to assume it will drive every little move. For instance, after today’s woefully inconsequential Fed announcement, bond yields rose at first before settling back down to unchanged levels for the 3pm CME close. The rate spike was seized by stock commentators in order to explain late day stock weakness. Pretty simple, right? The only issue is that the afternoon decline in rates coincided with more losses in stocks. In other words, headlines about stocks giving up their gains due to bond yields rising post-Fed are completely worthless…(read more)

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You'll Never Guess Who's Pushing Homeownership Higher

Posted To: MND NewsWire

The national homeownership rate ticked up slightly in the fourth quarter of 2017, but the U.S. Census Bureau said the change, from 63.9 percent in the third quarter to 64.2 percent in the fourth was not statistically different. The rate in the fourth quarter of 2016 was 63.7 percent. The rate has improved only slightly since reaching a historic low of 62.9 percent in the second quarter of 2016. Homeownership in the U.S. peaked at 69.2 percent in 2004. The rate was, as usual, highest among the oldest groups of Americans. Those 55 to 64 years old had a rate of 75.3 percent, up 0.5 point from a year earlier while 79.2 percent of those over age 65 were homeowners, a fraction lower than in the previous fourth quarter. The year-over-year increase was greatest among the much-watched Millennials ,…(read more)

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