Category: Mortgage News Daily

Posted To: MND NewsWire”Possibly the only thing worse than a world in which homeownership doesn’t work as a wealth-building tool is a world in which it does work as a wealth-building tool.” That statement summarizes the argument made recently by Daniel Hertz, senior fellow at City Observatory who contends that housing can’t be both affordable and a good investment. This observation runs contrary to conventional wisdom that homeownership is the most reliable pathway to household wealth. Well perhaps it is, Hertz says, just not for everyone. And this pits two pillars of American housing policy directly against each other. Hertz say that promoting homeownership as an investment strategy is risky. No financial advisor would advise going into debt as well as putting a substantial portion, if not all, of one’s savings…(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 began the post-holiday week by holding the same sideways posture seen last week during the slow market days surrounding Thanksgiving. Generally speaking, slow market days make for limited mortgage rate movement. The Monday following Thanksgiving is often something less than a full-fledged trading day for the investors that ultimately dictate interest rate momentum. In other words, today’s absence of change isn’t abnormal . There’s a greater chance that we see some more movement in the coming days. That’s both exciting and ominous . Rates are at something of a crossroads. Put another way, rates are knocking on a floor that used to be a ceiling. If they can make it back to the next floor down (into the range seen during the summer months), it would provide a solid indication that…(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 CommentaryMost of today’s bond market movement followed a single trade in the morning hours. Someone with deep pockets bought a lot of 2yr Treasury debt and sold some longer-term debt in the process. This type of “curve trade” (so named because its intent is to take a position on the movement of the yield curve ) is common. Curve trades are happening all the time every day. This one was just much bigger than normal. That doesn’t mean it’s necessarily significant, however, as the week after Thanksgiving (which often includes the last few trading days of November) typically sees a unique combination of certain traders getting back into the market after the holiday while other traders are getting into requisite positions for month-end . The big morning trade acted to reinforce a floor…(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 were every bit as flat as expected today. That’s a good thing at the moment, considering we’re holding in line with the lowest levels in more than a month. For the average borrower, that’s roughly an eighth of a percentage point lower than 2 weeks ago, when rates were near 8-year highs. The Thanksgiving week is typically uneventful for the bond markets that underlie mortgage rates, largely due to inconsistent participation among traders and other people in the supply chain for rates. The pace tends to pick up in the following week and especially in the first week of December as markets settle in to their final approach ahead of the mid-December Fed Announcement–oftentimes a focal point of end-of-year volatility. Loan Originator Perspective As expected, bond markets slumbered…(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 Press”Why is it that when the CDC warns us to not eat romaine lettuce, we take it as gospel. But when the CDC tells us that vaccines save lives, we think they’re part of the Illuminati?” Good question. Another good question is, “Is affordable housing going away?” There is a lack of affordable housing available for many first-time or middle-class homebuyers in certain areas. And gaps are widening. For example , the share of single-family homes valued at a million dollars or above “has grown 7.6% over the past year alone, and doubled since 2012, increasing from 1.5% to 3.6% of all homes on the market.” Just as the wealth gap widens, luxury or high-priced housing is generally isolated to the coasts. Interestingly, Suburban Boston is the only neighborhood in the top…(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 CommentaryI could go on and on about why it makes so very little sense for today to be a business day and for Thursday to be the official Thanksgiving holiday. To add insult to injury, the powers that be in the bond world have decided today should be a half day. Would it not make more sense to reassign Thanksgiving Day to the 4th Friday of the month and then create a another holiday for Thursday? We could call it “Meal Prep Day” or “What Do You Mean You Only Have Frozen Turkeys Day?” With the above proposed changes, we could have the half day on Thursday and then a full day on Friday. Same amount of closed time, but much less angst. Let’s get a petition started! But I digress. Today is indeed a market day, sort of… It tends to be one of the most random market days of the year…(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 NewsWireThe share of loans that were for refinancing and those where borrowers opted for adjustable rate mortgages (ARMs) both ticked up in October , with the latter garnering the largest share in recent memory, 8.2 percent. This was a full percentage point higher than the September share. According to Ellie Mae’s Origination Insights Report, the split between refinancing and purchase loans jumped from 29/71 in September to 32/68 in October. Both VA and FHA showed an uptick in their refinancing activity. Closing rates for all loans increased to 72.2 percent in October, the highest point this year and up from 71.7 percent the previous month. Closing rates on refinances increased slightly, from 64.4 percent to 64.9 percent, and closing rates on purchases held steady at 76.4 percent for the second consecutive…(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 CommentaryI used to be annoyed by the word “consolidation.” It was on a short-list of market jargon words that were overused and possibly nebulous. But over the years we’ve become friends . If it has annoyed or confused you, give it another chance. You might just find a new friend. I’m not sure what kind of market terminology glossaries there are out there, but I can make it easy for you with one synonym: REGROUPING . The word “regrouping” sounds kind of weird as a noun. Otherwise, I think it’s an even better term than “consolidation.” Either way, we’re talking about markets moving sideways after a rally or sell-off. Oftentimes, the sideways movement initially takes the shape of a push back against the previous move (i.e. a sell-off gives way to a nice little…(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 NewsWireExisting home sales broke their extended losing streak in October, increasing 1.4 percent from September to a seasonally adjusted annual rate of 5.22 million completed sales. It was the first positive report on sales of existing single-family homes, condos, townhouses, and co-op apartments since last March. The National Association of Realtors® (NAR) said the gain was not enough however to return existing home sales activity to 2017 levels. They lag the 5.5 million transactions last October by 5.1 percent After overshooting the mark with their last six forecasts, analysts polled by Econoday were more restrained and consequently quite accurate in their expectations for October. Their predictions were in the range of 5.10 to 5.35 million units with a consensus of 5.20 million. Single-family…(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 were almost perfectly flat today, and have been largely unchanged since last Friday. If you were forced to predict such a thing at the end of last week, the odds would have been in your favor. In other words, when rates are on the move, Thanksgiving week tends to see a temporary pause in that movement. Bond markets and mortgage lenders will naturally be closed for the holiday tomorrow. They will technically be open on Friday but participation will vary widely. Many lenders won’t update their rate sheets. Others will only make token changes unless financial markets are unexpectedly wild. The following week should see market and mortgage rate activity pick up again. Happy Thanksgiving! Loan Originator Perspective As expected, bond markets slumbered through today, eyeing the Thanksgiving…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.