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Posted To: MND NewsWireThe availability of mortgage credit at least as measured by the Mortgage Bankers Association’s (MBA’s) Mortgage Credit Availability Index (MCAI) pulled back in September, with the government component of the index falling to the lowest level in four years . The MCAI registered 182.1 at month’s end, an 0.8 percent decline. An increase in the index indicates a loosening of credit, a lower number indicates standards have tightened . The components, representing different loan programs, largely offset each other, making substantial moves in both directions. The Conventional MCAI rose 1.2 percent and one of its components, the Jumbo Index increased by 2.7 percent. The Conforming MCAI, the second part of the Conventional Index, decreased by 0.7 percent and the Government MCAI lost 2.5 percent. “Credit…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Posted To: MND NewsWireLesson learned? Whether they saw their credit decimated by the housing crisis and the Great Recession or merely watched loan standards tightened beyond their ability to qualify, Americans seem to have taken to heart the importance of their credit scores. The result, FICO says, is that consumer credit scores have reached a new high, an average of 704 points. Kenneth Harney, in an article for the Washington Post’s Writers’ Group, quotes FICO Vice President of Scores and Analytics Ethan Dornhelm that Americans are “making more judicious use of credit.” This means higher scores on the FICO model that weights them not only in terms of on-time payments but on the length of the credit history, the amount and type of credit a consumer has available, and how much of that available credit is being used…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Posted To: MBS CommentaryIf you didn’t catch it, and want to get caught up with yesterday’s big move, this tweet has several links that should bring you thoroughly up to speed: https://twitter.com/MG_MBS/status/1047627670987526145 Moving on to today, I have a saying that I’ve only dusted off a few times over the past 10 years. I was thinking about using it today: “The biggest risk to this analysis is how obvious it is.” This is analogous to a scene in any given movie where someone says “this feels like a trap” or “it’s quiet… almost too quiet.” In market terms, it has to do with the fact that widespread agreement on what SHOULD happen next often results in the opposite thing happening. After all, if every trader made the same trade, none of them would make money. So it…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Posted To: Pipeline PressIn bad news, mortgage rates went up about .25% yesterday. In good news, more homes are going up for sale. According to realtor.com there was a September jump of 8% year over year, that’s the biggest jump since 2013. Between less deductions and higher rates, anxious sellers may have no other choice but to lower prices. “The Labor Department’s data on wages for US workers showed gains higher than expected for hourly wages, and the department’s forthcoming consumer-price index is expected to show growth. Some analysts have expressed concerns that the data could indicate accelerating inflation.” Are “analysts” ever happy? Most would say we need wage growth to outpace housing appreciation. There is a lot of economic news pointing to higher rates ahead – more below….(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Posted To: MND NewsWireNearly two years ago the Federal Housing Finance Agency (FHFA) approved Underserved Market Plans from Fannie Mae and Freddie Mac. These plans, part of FHFA’s Duty to Serve mandate to the two GSEs, set forth their plans for serving three specific markets, manufactured housing, affordable housing preservation, and rural housing, by increasing the liquidity of mortgage investments and improving the distribution of capital available for mortgage financing for very low-, low-, and moderate-income families in the three markets. The plans went into effect at the first of the year, and the GSEs have used them to set several programs in motion. Most recent was last week’s announcement from Freddie Mac of an intent to expand mortgages available to shared equity housing arrangements. FHFA is now requesting…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Posted To: MBS CommentaryIn terms of outright movement toward higher rates, you’d have to go back to the days following the election in November 2016 to find anything worse than today. It was like a handful of other snowball selling sprees seen over the years in that it seemed unnecessarily relentless while it was in process, but will end up making sense in the bigger picture. Whether or not it will make sense to you depends a lot on how closely you’ve been following along (either with the realities facing rates over the past few years or simply with this commentary). It would seem quite complicated if you’re not already drinking my kool-aid , so I’ll attempt to share an abbreviated recipe below. Incidentally, I say “my kool aid,” but in reality, I think there’s only one kool-aid when…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Posted To: Mortgage Rate WatchMortgage rates skyrocketed today, in relative terms. It was the single worst day in nearly 2 years, and among only a few days where effective rates moved more than 0.10%. Typically, mortgage rates are offered in 0.125% increments. We’re able to track “effective rates” by examining the upfront costs associated with any given rate. For instance, a quoted rate might not change from day today despite major changes in upfront costs/credits. At a certain point, the upfront cost change is big enough that it makes more sense to jump up by the aforementioned 0.125% increment. In other words, if you have a loan in process, an effective rate increase of 0.10% means there’s a very good chance that you’re looking at a 0.125% increase in rate today. And if you’re not, you’d instead be seeing this move in…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Posted To: Pipeline PressBetween 2001 and 2016, 97 percent of total job growth in the Unites States happened in urban counties. And while rural America is absolutely struggling, all rural America isn’t all struggling. In the top 10% for job growth, the U.S. counties, 34% are large metros/urban, 14% medium metros, 11% small metros, 18% were rural and adjacent to a metro, but there are plenty of remote rural counties doing great : 16% of the counties in the top 10 percent for job growth are small and rural and not adjacent to a metro. Typically, it’s because the factory fairy recently visited: Storey County in Nevada got the Tesla factory, Love County, Oklahoma got a casino, Sumter County, Florida got a retirement community. Lender Products and Services With just 2 short weeks until our industry ascends on…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Posted To: MND NewsWireAs mortgage interest rates moved higher during the week ended September 28, with small increases carrying most to new seven year highs, application activity almost froze in place. The Mortgage Bankers Association (MBA) said its Market Composite Index, a measure of application volume, was unchanged from the prior week on a seasonally adjusted basis and lost 0.2 percent on an unadjusted basis. The Refinancing Index decreased 0.1 percent from the previous week. The share of applications that were for refinancing was unchanged from the week ended September 21 at 39.4 percent. The seasonally adjusted Purchase Index eked out a 0.1 percent increase , extending to five weeks its streak of mainly tiny gains. On an unadjusted basis the measure declined 0.2 percent from the previous week’s level and was…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Posted To: MBS CommentaryZen practitioners are an odd lot. One of their hallmark koans–the one about whether or not a tree falling in the woods makes a sound–is nonsense. I can only imagine that the person who came up with that one had never actually seen a tree. Perhaps he or she thought it was made of feathers. Or perhaps there really is some merit to the question inasmuch as how one defines “sound.” Does the falling tree still disturb surrounding particles of air and create soundwaves that COULD be heard if someone were within earshot? Of course. Does that count as “sound?” I don’t really care. Physics tells us the soundwaves are there, and that if anyone is close enough, they would hear them. A far more relevant question is as follows. If you hear a tree falling in the woods, do you give…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.