Category: Mortgage News Daily

Posted To: MBS CommentaryIt would be a tad dramatic to say that rates are at a crossroads as we head into the end of September, unless there’s any additional weakness this week. That’s because any additional weakness will bring yields closer to breaking 2018’s previous high of 3.128% set on May 18th, 2018. When rates break a long-term high, there’s always a risk that the previous ceiling will act as technical line in the sand. The natural fear would be for such a breakout to prompt additional momentum toward even higher rates . That’s always a possibility, but it’s one of two. The other possibility–in the event of additional weakness this week, of course–is that yields would simply be stretching the boundaries of existing ranges or perhaps just extending an upwardly-sloped trend. In he case…(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 NewsWireFreddie Mac’s Economic and Housing Research Group said on Monday that the U.S. economy and job market are firing on nearly all cylinders , “but the housing market has essentially stalled .” The solid growth of the U.S. economy during the second quarter, an increase of 4.2 percent and exceeding forecasts of 4.1 percent, was the fastest in nearly four years. Solid consumer spending and business investment, the Group says in its September Forecast, should keep the economy on a very strong growth path of 3.0 percent this year, moderating to 2.4 percent next year. However, weaker affordability, homebuilder constraints, and ongoing supply and demand imbalances over the summer resulted in fewer home sales and less home construction compared to earlier in the year. Those sales declined in the second…(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 PressWhen I spent an hour interviewing Angelo Mozilo on stage last week for the American Pacific Mortgage Summit, one of the issues we discussed was the competitive environment for lenders, and the evolution of the mortgage loan originator. Angelo, who is very much in command of his game, is a strong believer in the strength of the relationship that originators have with their clients, and the future that originators have in the lending industry. Lenders always have their eyes on the horizon, watching the changing competitive environment, and along those lines I penned a piece for the STRATMOR Group titled “The Rise of the Credit Unions.” Fraud, Legal Chatter, Warnings Jonathan Foxx published, entitled “Mortgage Fraud Challenges: How to Catch a Crook.” “Tracking down…(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 CommentaryMore often than not, when I use the word “believe” (or belief), it’s in some vague and positive context. For instance, something like “bond buyers are starting to believe again.” That won’t be the case today–at least not as far as the positive context is concerned. Today I want to talk about the beliefs that have radiated up from the short end of the yield curve over the past few years. They’re like an infection that started in the toe but spread to more vital organs surprisingly quickly. The “yield curve” is just a fancy way of referring to the spectrum of time associated with various loans. The loans in this case are those taken out by the US government (via the Treasury Department) to finance all of its various spending. For instance, there are…(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 NewsWireEven as flood water continue to sit in living rooms and kitchens across a large swath of North Carolina it is clear that most of those homes are not insured against the damage. Mary Williams Walsh, writing in the New York Times, says that in North Carolina and South Carolina, which suffered less widespread damage, only about 335,000 homes in total have flood insurance. The Urban Institute (UI) reports that the number of policies homeowners purchased through the National Flood Insurance Program (NIP) has declined over the last ten years and the total is now just over 5 million nationwide. There are also some private insurance policies, but nowhere near enough to cover the affected homes. Sarah Strochak, Jun Zhu, and Laurie Goodman used data from the Census Bureau’s 2017 American Housing Survey…(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 actually fell today, on average–something they haven’t been able to say all week, or indeed at nearly any time during the past 4 weeks. Yesterday, in particular, was the worst day for rates since 2011 for most lenders, with anything less than an ideal loan scenario garnering 30yr fixed quotes of 4.875% to 5.0%. With all of the above in mind, today’s token improvement isn’t necessarily exciting, but at least it’s better than the alternative. Much of this week’s rapid rise was seen in the first half of the week. Starting on Wednesday afternoon, markets began settling into a more sideways pattern, apparently getting in position for more volatility in the coming week. If there’s an event that’s likely to serve as the catalyst for that volatility, it’s the Fed Announcement on Wednesday…(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 CommentaryBy today, it became clear that bonds were fully locked into a sideways consolidation in a range defined by the highs seen on Wed/Thu and the lows marked by the 3.06% technical levels. Of the past 3 sideways days, today was the least volatile and most lenders saw fit to offer just slightly stronger rate sheets despite ‘unchanged’ levels in bond markets. Consolidations like this can happen simply because markets are catching their breath after a strong move or because they’re settling down ahead of the next event that might cause a strong move. If we’re dealing with the latter, the event in question is likely to be Wednesday’s Fed events (announcement, press conference and updated rate hike outlook). Of those three, it’s the(t “dots” he dot plot that conveys…(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 CommentaryOne of the themes we often revisit in times of trouble is the long-term bull market in bonds. This traces back to the 80’s and provides a shockingly linear set of lower highs and lower lows in 10yr yields. Most recently, we’ve seen yields rise back to the upper boundary of the long-term trend. There’s still a chance they could hold ground here, but any further weakness means an official breakout. One other reason to hold out hope is that yields are also at the top of a shorter-term uptrend (teal lines). This could offer some technical support of its own, but it should be noted that the current version of that uptrend is much less linear than the one seen from 2002-2007. Incidentally, I think all of this “big picture trend” business is just a cheap trick (one I’ve often…(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 PressThis Saturday is the autumn equinox – season-wise, we know what is on the way. “Rob, we, like everyone else, are watching the approaching winter, and higher rates, and wondering if there are ways to improve our financial picture without laying people off or cutting LO comp. Heard of anything?” This is going to sound like a paid ad, but it is not. I refer folks to Riivos (ex-Alight). It’s a cloud-based application for mortgage companies, regardless of size, that “integrates with your core systems (G/L, LOS, payroll, etc.) to show where your BPs are going, what actions you can take to improve profitability, and insight into how those decisions ripple through the company and increase P&L.” They specialize in “what if” scenarios. IMHO, and my…(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 NewsWireIt was a disappointment, but at least it wasn’t a loss. Existing home sales, which were expected to increase in August after four straight months of declines instead remained unchanged from July. In fact, almost the entire report on August’s existing home sales can be summarized by the word, “flat.” Said sales of single-family homes, townhouses, condos, and cooperative apartments were at the seasonally adjusted rate of 5.34 million, identical to the July rate. Sales in July had fallen 1.5 percent below those from a year earlier, and that too was unchanged in the August to August comparisons. Existing home sales were selling at an annual rate of 5.42 million in August of last year. Econoday said the analysts it polls were expecting at least a modest increase after months of lagging sales analysts…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.