In the middle of October, we wrote two blog posts that seriously called into question the effectiveness of the Home Affordable Modification Program (HAMP). In addition to magnifying the program’s inabilities, our two articles also highlighted a wealth of HAMP’s “unintended consequences.” While the two articles addressed different specifics, the [...]
There is big news in the world of jobs today, the number of lost jobs is getting smaller. The unemployment rate fell back to 10% in November after hitting 10.2% in the month prior. Only 11,000 jobs were lost in November — some 90,000 less than some economists had [...]
We just recently read that, according to the critics, the president’s jobs summit — which began earlier this afternoon — “is more about politics than policy.” If you think about it, isn’t most, if not all, policy driven by political pressures?
On one hand, economists like Lawrence Summers feel that “There [...]
Here is the last chapter in this saga. Unfortunately for the couple who wrote this first-hand experience, their latest snag in the home-buying process remains unresolved, leaving their fifth offer to remain in limbo.
This latest twist that has prevented the couple from closing on their home is a scenario called [...]
HUD Secretary Shaun Donovan testified today before the House Committee on Financial Services to explain the new measures that will implemented in order to better promote the Federal Housing Administration’s solvency (FHA) moving forward.
Earlier this year, we warned that the FHA could be the next taxpayer bailout, and [...]
In case you haven’t read it already, our very own VP Keith Gumbinger spoke with SmartMoney.com earlier this week, and gave our take on where we think mortgage rates are headed next year.
Lisa Scherzer of SmartMoney.com begs the question, “What will happen to mortgage rates when the Fed stops manipulating [...]
Earlier today we posted a story from the Real Estate Wonk (Jamie Smith Hopkins of the Baltimore Sun) of one couple and their unsuccessful attempts at buying a home in today’s unique real estate market. The couple, Peter and Karen, saw all types of properties, everything from foreclosures, to [...]
We’ve consistently noted that perhaps the largest hurdle facing borrowers in this current real estate market is securing financing. Mortgage rates have been historically low for almost a year now, real estate prices are nearing a bottom (if they haven’t reached one already), and incentives like tax credits have been [...]
If it didn’t work the first time, what makes the Obama administration think it will work this time?
What we’re referring to here is Washington’s insistence on shaming mortgage lenders into modifying more loans. We can think of several reasons why this strategy is merely the latest in a string of [...]
Active as well as potential homebuyers had one more thing to be thankful for during the holiday-shortened week: low mortgage rates. According to the latest issue of HSH’s Market Trends Newsletter, “Thanks, for Low Mortgage Rates,” the average price of all loans — conforming, jumbo and agency jumbo combined [...]
Lew Sichelman wrote an excellent piece for the trade publication National Mortgage News citing a fresh study which explored the likelihood that an underwater borrower would walk away from their home, even if they could afford to make payments.
The article noted that “fewer than one in 1,000″ borrowers would mail [...]
We write about credit cards a lot in this blog. We’ve covered the credit card reform pretty closely, documenting many of the “unintended consequences.” However, today we want to address a different form of plastic: debit cards.
While we’ve encouraged consumers to some degree to focus on debit as opposed [...]
HSH Associates will be closed over the next two days to observe the Thanksgiving holiday. We will return on Monday November 30. We will do our best to keep the posts coming through the holiday and throughout the weekend.
Have a great Thanksgiving! — from HSH Associates
The latest results in a series of reports investigating the existence of a harmful chemical in imported drywall have been released this week. A Federal report found a “strong association” between hydrogen sulfide, a chemical found in Chinese drywall, and the corrosion of household metals.
If you recall, last month [...]
It was one year ago today that the Federal Reserve announced their plan to “reduce the cost and increase the availability of credit for the purchase of houses” On November 25, 2008 the Fed decided to support Main Street and the mortgage market by committing their first round of purchases [...]
Unfortunately, this is rather old news. In early May we had warned readers that those few extra bucks you were receiving in your paycheck each week, thanks to the president’s Making Work Pay tax credit, may need to be paid back come tax time.
It’s safe to say that when it comes to government programs — whether they be consumer incentives (tax credits), industry overhauls (credit card and financial reform), or economic initiatives (stimulus, loan mods and refis) — we at HSH.com are skeptics. Our first reaction tends to be one of query [...]
Sweeping financial overhaul programs are making their way through Congress as we speak. A portion of that large legislation includes a measure to create the Consumer Financial Protection Agency (CFPA) — a Federal entity that will write and enforce new regulations covering financial products such as credit cards and [...]
Mortgage rates are on a roll. Rates fell last week to their lowest levels seen all year. According to the latest issue of HSH’s Market Trends Newsletter, “Mortgage Rates Downshift, Match Year’s Low,” the conforming 30-year fixed rate dipped below the 5% mark.
“Although one might have thought that everyone [...]
Lew Sichelman wrote an excellent piece for the trade publication National Mortgage News citing a fresh study which explored the likelihood that an underwater borrower would walk away from their home, even if they could afford to make payments.
The article noted that “fewer than one in 1,000″ borrowers would mail [...]
Saturday
“Home Equity: Why 2015 is the New Zero”
Friday
“Supporting Housing, But at What Cost?”
Thursday
“Looking for a Job — Have You Tried Modifying Mortgages?”
“Minimum Underwriting Standards: The First Step”
Wednesday
“94% Say ‘Would Have Bought Home Without Tax Credit’”
“Philly’s Foreclosure Program Is Becoming A National Model”
Tuesday
My colleagues and I at HSH have asked and debated over this question for most of the year: “To what cost are we willing to promote home ownership?” As close to the market as we are, we fully recognize the value of home ownership. However, our lawmakers have steadfastly promoted [...]
While initial unemployment claims were technically “flat” last week, the number was still over 500,000 — a level the unemployment indicator has remained at for 53 straight weeks. Despite any improvements we’ve seen in the economy, it appears as though employers just aren’t hiring…outside the mortgage industry that is.
With [...]
At a financial seminar in Japan yesterday, Comptroller of the Currency John Dugan urged mortgage regulators around the world to institute minimum underwriting standards which every lender must adhere to.
“These standards would not dictate every underwriting feature of a mortgage product; instead, they would focus on core practices [...]
We’ve expressed doubts with regards to claims that the homebuyer tax credit was responsible for up to 50% of the year’s increase in home sales.
Industry groups like the National Association of Realtors (NAR) and the National Association of Home Builders (NAHB) pleaded with lawmakers to extend and expand the [...]
Back in July we wrote about a foreclosure assistance program that was specific to the city of Philadelphia — a program that seemed to be generating far better results than other foreclosure-prevention efforts. Nearly some six months later, Philly’s “Residential Mortgage Foreclosure Diversion Pilot Program” is back in the [...]
We apologize for we understand that there was a technical difficulty that prevented this week’s stories from appearing on the blog.
Here are the links to this week’s stories (so far) so you can get caught up. Again, we apologize for the inconvenience.
Tuesday:
Chris Thorman at www.SoftwareAdvice.com has written a great post on Fannie Mae’s recently-announced Deed for Lease (D4L) program that complements our previous post on the subject very well.
Thorman’s article does a good job at breaking down D4L using easy-to-understand language. “Own to Rent: Breaking Down Fannie Mae’s Deed [...]
-One of our dedicated readers Chris passed this article along — he thought our other readers would find it interesting-
When a bill that included the extensions of both the homebuyer tax credit and unemployment benefits was circulating through Washington, most of chatter surrounding the legislation had to do with the [...]
There’s no doubt that today’s strict underwriting requirements have left many borrowers with a bad taste in their mouth. However, a recent study suggests that an open line of communication between servicer and borrower can greatly improves a customer’s experience — even in a stressful loan environment like the one [...]
Over the past year or so, the daunting task facing potential homebuyers hasn’t been locking in on a low mortgage rate, it has been whether or not you can qualify for financing amidst the strict lending conditions. The last issue of HSH’s Market Trends Newsletter, “Rates Ease Back Slightly,” [...]
Each Saturday we review all the stories we published during the week — just in case you missed one or two.
Friday
“FHA Reserves Almost Gone, And There’s No Going Back“: HUD/FHA say no need for a bailout. We say that the FHA’s expanded role in the marketplace suggests otherwise.
Thursday
It’s as bad as many thought. The results of the Federal Housing Administration’s (FHA) annual independent audit were released yesterday after being delayed for about a week. The Federal mortgage insurer’s cash reserves have fallen to 0.53%, well below the 2% limit set by Congress.
If you’re a regular reader [...]
As part of an effort to step up consumer protection against things like excessive fees, the Fed announced a final rule, beginning in mid-2010, that will prohibit banks and credit unions from charging overdraft fees unless their customers agree to overdraft protection. As reported by the Wall Street [...]
While many of you have been keeping tabs on our regularly-updated post on the homebuyer tax credits, we wanted to take it a step further by writing another post which provides most of (if not all) the links and information you’ll need to answer any more questions you may [...]
President Obama announced today that a jobs summit will be held at the White House next month in order to recast legislative attention to a sector of the economy that has worsened:
“This is one of the great challenges that remains in our economy, a challenge that my administration is [...]
Don’t forget to check in on our “HSH in the News 2009” page located at the top-right section of the blog. News outlets across the country seek to quote not only our mortgage rates and statistics, but they often seek our commentary and opinions on the latest financial and [...]
According to the October 2009 Senior Loan Officer Opinion Survey, lending standards remain tight. The good news, according to the survey, is that tightening standards have eased somewhat from the “peaks reached late last year.”
While we know this general information comes as no big surprise, we believe it’s important [...]
We’re “borrowing” this topic from our friend Mitch over at TopFinanceBlog.com. While Mitch’s latest post is titled “Why I Say Credit Scores Are Worthless,” we’re taking a somewhat different approach.
Banks and credit card companies have been jacking up interest rates and fees (if not simply canceling cards) more and [...]
Our readers are still commenting on our original post about www.Tagged.com, even though the story was written some five months ago. The email phishing scam involving Tagged.com quickly caught the attention of N.Y. Attorney General Andrew Cuomo who claimed that the website was responsible for “deceptive email marketing [...]
Finally!
We’ve read over a couple articles and blog posts today about the FHA’s new, stricter guideline for their streamline refinance program, due to go into effect next week. The advice from mortgage brokers is to submit your refi application A.S.A.P. in order to take advantage of the “old” requirements. [...]
The latest installment in what seems like an endless stream of email scams, targets an entity we haven’t seen yet: credit unions.
Just this morning we received an email with a subject that read: “Important Notification.”
Here’s what the email looked like:
You have 1 new ALERT message
Please login to your Treasury [...]
Mortgage rates seem to be one of the more consistent and stable economic factors that we’re following these days. According to the latest issue of HSH’s Market Trends Newsletter, “Rates Still ‘Exceptionally Low‘,” the conforming 30-year fixed rate closed our survey week at 5.13% at a quarter-point fee level.
“The [...]
Here is a recap of all the stories we published this week — in case you need to get caught up.
Friday:
3. Uncertainty Is Hurting Job Growth: Costly portions of pending legislations, like the health care reform, leave small business owners uncertain about the future.
In our post this morning on the October job numbers, we wrote that the third quarter’s increased productivity was a sign that employers have been successful in meeting their demand with fewer employees. Doing more (or about the same) with less is just one factor that’s holding back job [...]
The unemployment rate has surpassed the 10% mark for the first time since 1983, two months earlier than many had widely predicted. The jobless rate increased to 10.2% in October from 9.8% the month prior.
The Numbers Are Grim
October marked the 22nd straight month that the country has reported job losses [...]
The reckoning is finally on the horizon
-Richard Green
Commercial real estate (CRE) experts know that their market will be in shambles for months (if not years) to come. However, a recent survey reveals that many industry professionals believe that the market will hit bottom in 2010:
Real estate industry leaders [...]
UDATE1: Fannie Mae has released the details to a program that will turn struggling homeowners into renters. The “Deed for Lease Program” (DLP) allows delinquent homeowners to rent their home for up to a year instead of being foreclosed upon.
Wisely, Fannie hasn’t yet said how [...]
For months now, the hype surrounding the conclusion of the Federal Open Market Committee’s (FOMC) two-day meetings has been far less about a possible change to the Federal funds rates, than it has been about the short statement that follows.
Today’s conclusion certainly continues that trend. While we weren’t expecting [...]
Wells Fargo is betting that improving home prices and an increase in consumer income will make their new loan modification strategy a success. The nation’s fourth-largest bank (in terms of assets) has introduced a new, and frankly quite interesting, strategy to modify their large portion of Payment Option adjustable-rate mortgages [...]
The Office of the Comptroller of the Currency (OCC) recently issued a Consumer Advisory titled “Reverse Mortgages: Are They for You?” The advisory is designed to educate older homeowners on the ins and outs of reverse mortgages and their possible alternatives.
The advisory offers basic facts borrowers should know, the [...]
Personal finance blog “FiveCentNickel” asks their readers to imagine a world where cash is king in a recent post titled “Is It Possible to Live Without Credit Cards?”
The notion may seem unrealistic to some, especially in this uncertain economic environment where thousands of Americans are unemployed or under-employed and [...]
Senate banking committee Chairman Chris Dodd proposed a legislation today that would freeze the interest rates on the existing balances of an estimated 700 million credit cards.
While Dodd’s camp maintains that the legislation reinforces the Congressman’s opinion that “more consumer protections were needed,” many critics see the proposal as another [...]
Home equity lines of credit practically vanished beginning in 2008 when home prices plunged. Homeowners watched helplessly as access to their equity withered with every new report of falling home prices. Borrowers who sought to open home equity credit lines of credit were either denied or offered terms and rates [...]
While we wrote last Monday that “Mortgage Rate Stability May Not Last,” it appeared as though it did. Mortgage rates held steady last week as the stock market’s woes “did produce somewhat lower Treasury yields,” which could help mortgage rates trend downward this week.
Mortgage Rates
Be sure to check out our “Weekly Recap” to read up on any stories you might have missed this week:
Friday:
“Update1: Congress Approves Jumbo Conforming Limit, Still Unnecessary”
“Spotting Great Deals in This Buyer’s Market”
Thursday:
We’ve made a lot of noise recently that things are going a lot better for homebuyers than for sellers. Opportunities abound in today’s housing market for buyers — from cheap real estate prices, to historically-low mortgage rates, to Federal tax credits (click here to read the latest on its [...]
The Interagency Task Force on Chinese Drywall released their preliminary findings of an ongoing study to determine if a viable link exists between the imported building product and the reports that it has caused illness and/or the corrosion of surrounding building materials.
At this juncture, no definitive link has been [...]
UPDATE1: Congress approved keeping the jumbo conforming loan limit at $729,750 through 2010. We still think it was unnecessary.
The “resolution” is headed for the president’s desk where he is expected to sign it either today or tomorrow.
Despite our opinion that the combination of falling home prices and the narrow market [...]
Why hasn’t Washington offered any aid to help the beleaguered mortgage insurance (MI) industry?
Lawmakers have thrown a bone to nearly every other sector of the housing and mortgage-related industries, but not to mortgage insurers. Especially at a time when credit requirements are so stringent and when most lenders are requiring [...]
We’ve warned readers countless times about email spam. We try to tell readers what to look out for and how to protect themselves from online fraud. A spam email we got this morning goes back to the warning that scammers will use government agencies to either scare you [...]
A White House official has said that Barney Frank, chairman of the House Financial Services Committee, will introduce legislation as early as this week designed to tackle what the New York Times refers to as “one of the most fundamental issues stemming from the near collapse of the financial system [...]
You don’t hear much about the Federal refinancing effort these days. In what started out as the focal point of the Treasury’s two-pronged attack on the housing crisis, soon became dwarfed by the rescue’s other facet: modification.
So why haven’t we heard much about the Making Home Affordable refinancing program lately? [...]
Mortgage rates stood their ground last week amidst a “turbulent” week in the markets. According to the latest issue of HSH’s Market Trends Newsletter, “Rates Steady This Week,” that’s one trend that may not last much longer.
“Mortgage rates managed to finish a fairly turbulent week in the markets at [...]
UPDATE1: We just received a reader comment that may offer some help to the homeowners out there dealing with tainted drywall. A gentlemen representing “Electrocorp” — an air purification company — said they have been helping homeowners who have Chinese drywall installed in their homes get some much-needed relief.
While [...]
Ryan Dube of www.makeuseof.com has put together what he calls “a simple list of sites…that you should check every week to save a fortune on your grocery bill.”
We’re sure that you have likely heard of some of the websites on Dube’s list before, but there are others that are likely [...]
Friday:
“Falling Home Prices Are Good for Something, Right?“: Sure, but only if you’re buying a home.
“Update1: Madoff’s Beach House Sells for $9.41 Million“: It not only got more than the asking price, it drew four different bidders. What is so special about this house?
Thursday:
For any borrowers out there who are currently “underwater” on their home loan, our title may be a little tough to read. But the truth is, low homes prices have contributed to the increased levels of affordability in today’s housing market.
The market’s improving affordability conditions (cheaper sales price and financing [...]
But I thought the housing market was improving? If you were under the assumption that housing had hit bottom, chances are you’re not alone.
The ever-changing monthly numbers and future projections have created a lot of back and forth expectations from consumers over the state of the housing market. The problem [...]
MarketWatch.com reports this afternoon that the price of a barrel of crude oil increased by $2.25, reaching a one-year high of $81.37. The “front-month contract,” as followed by the New York Mercantile Exchange, is the highest price since last October.
According to the Energy Information Administration, the national average price [...]
Don’t forget that you can sign up to receive a daily dose of “blog.HSH.com” in your inbox.
Simply enter your email address in the box (labeled “Receive Updates via Email”) at the top-right corner of the page and then click the “subscribe” button. A pop-up window will ask you to enter [...]
We called it! While some industry experts like Curtis Arnold of CardRatings.com said that they didn’t expect the recently-enacted credit card reform to impact good customers, we warned readers back in May that it was inevitable.
It’s simple: if you take away the credit card companies’ ability to raise rates, [...]
“Is that about the coolest thing you’ve ever heard?”
-Roger Gaddis of Ada Electric Cars
We have a feeling that not everyone is likely to agree with Mr. Gaddis.
As part of President Obama’s stimulus plan, Americans can receive a rebate for the purchase of an electronic vehicle. Luckily for golfers, [...]
UPDATE6: It’s a done deal. President Obama signed the “Worker, Homeownership and Business Assistance Act of 2009″ which institutes an extension and an expansion of the homebuyer tax credit.
The tax credit, which was due to expire on December 1, 2009, will allow first-time buyers to claim 10% of their home’s [...]
There has been some controversy and speculation that banks are holding onto foreclosed properties — rather than releasing them back into the marketplace, and are foreclosing on borrowers who have, or could have, qualified for a loan modification.
We’re still receiving comments on the story that we wrote on this exact [...]
Unfortunately we can’t predict the future, but we can sure try and forecast it. Six times a year, HSH releases a two-month forecast for mortgage rates in which we rely on our 30 years of industry experience to anticipate where and how the markets will move.
Rates fell further than we [...]
Some analysts have said that the “new normal” economy won’t be like anything that we were used to before the financial crisis. However, that may not be the case for all economic indicators. Things got a little more “normal” last week when the Dow Jones Industrial Average hit the 10,000 [...]
Here’s the breakdown of last week’s stories — just in case you missed one:
Friday:
Thursday:
Since the recession has staved off inflation to a great degree, 2010 will be the first year that there will be no cost of living adjustment (COLA) for the some 50 million Americans on Social Security. “Recessions drive down prices by nature,” said HSH VP Keith Gumbinger.
In order “to preserve [...]
In the days ahead, will the private Mortgage-Backed Securities (MBS) market cease to exist? Will loan modifications wind up destroying the long-standing playing field between lenders and second lien holders? Will the Fed ever be able to exit the mortgage market?
These questions have all come to mind because of unintended [...]
Update1: It seems the answer to that question isn’t lost on the administration, and many taxpayers are likely to be thankful for that.
Reapplying their leverage spawned by the billions upon billions given out to save big-time banks, insurers, and automakers, the White House is once again tightening their grip on [...]
Consumers shop at warehouse clubs (Costco, BJ’s, Sam’s Club) for one fundamental reason: to save money. In recent years, many shoppers have associated buying in bulk with saving money. Yet, that’s not always the case.
Personal finance experts Ken and Daria Dolan say there are several items you should stay [...]
Over the past few days or so, we compiled a short list of topics that we thought you all might find interesting. Below is a short synopsis of each:
“50 Ways the Feds Waste Our Money“: Despite its generic title, this list is worth perusing. Seventy-two billion dollars wasted on [...]
The Federal Trade Commission (FTC) is now taking consumer comments regarding how they can improve upon the website ‘AnnualCreditReport.com‘. The recently enacted credit card reform has put new rules into place regarding the marketing of credit reports.
According to Michelle Singletary of the Washington Post, consumers have logged [...]
Many Americans (us included) realize that the government’s rampant spending is likely to mean a tax increase — in one form or the other — sometime in the near future. As both a partial solution to prop up state budgets and to reduce healthcare costs, many Americans are behind a [...]
Back in June when mortgage rates began to increase from their spring-time lows, we wrote a post with the exact same title as this. Despite the fact that we’re republishing it some four months later, the context still applies (emphasis added):
When mortgage rates sank to the lower end of [...]
According to the latest issue of HSH’s Market Trend’s Newsletter, “Conforming Rates Down; Jumbos Crack 6% Mark,” the average rate for a 30-year jumbo fixed-rate mortgage dropped to 5.96% — the first time the rate has fallen below 6% since September 9, 2005. Not to be outdone, on Wednesday [...]
Is cheap the new normal? At least one American business executive seems to think so. With consumer spending in the tank, retailers are doing whatever they can to lure shoppers. Personal finance gurus say there has never been a better time to be a consumer:
The Great Recession has caused [...]
We’re starting a new weekly post that’s designed to simply list and link to all the stories we wrote during the week…just in case you missed one.
Friday:
“With Email Scams Galore, Guard Your Password“ “Is it Time to Modify Modifications?“Thursday:
“Survey: Americans Not Giving Up Their Jobs“ “500,000 Loan Mods: [...]UPDATE1: We thought so, and said just as much last Friday…we just had no idea it would happen this quickly. A short bulletin from National Mortgage News (NMN) this morning reported that the Treasury Department’s Office of Homeownership Preservation (OHP) announced at the Mortgage Banker’s Association’s annual conference that a [...]
The recession seems to have brought the hackers and spammers out in full force. Our previous posts on fraud have received a lot of attention since they’re obviously of some concern and interest to our readers. We’ve told you about the scams that have pervaded social networking sites like [...]
Touted as a “milestone” by the Treasury, President Obama’s loan modification program has reportedly helped 500,000 borrowers avoid foreclosure. According to the New York Times, the White House set out to reach the 500,000 mark by the end of this month, and is quite encouraged that the goal was [...]
At the close of business today, the average conforming 30-year fixed-rate mortgage with no points came in at an average 5.09%, among the lowest average rates seen in 2009.
“These low -upfront cost loans are crucial to getting more refinancers into the market,” said Keith Gumbinger. “It also allows potential homebuyers [...]
Beginning this month, Bank of America (BofA) is supposedly offering a new credit card designed around simplicity. The new BankAmericard Basic Visa card features only one page of terms and conditions as well as a fixed interest rate (sort of — we’ll explain in a second) for all purchases, even [...]
Realtors and mortgage brokers are clamoring to get the $8,000 first-time homebuyer tax credit extended. Certain market observers fear that as soon as the tax credit expires, home sales will retract to the lower levels observed prior to the tax credit’s introduction (see our story on how Cash for [...]
The Office of the Comptroller of the Currency (OCC) and the Office of Thrift Supervison’s (OTS) Mortgage Metric Report for the second quarter of 2009 has been released (rather quietly might we add), and while many aspects of the report were widely expected, there was one new inclusion that [...]
According to National Mortgage News (NMN), the White House is still “mum” on whether or not lawmakers will vote to extend or expand the $8,000 first-time homebuyer tax credit.
If you’re still unsure about taking advantage of the credit, the clock is ticking. All the way back in August we [...]
A recent report from the National Consumer Law Center (NCLC) warns that the reverse mortgage industry could very soon become the new subprime. The report claims that former subprime lenders have altered their business model in order to cater to reverse mortgages instead. While the products are very different in [...]
It might be rare these days, but if you have a little extra money left over at the end of the month, what should you do with it — pay debt, invest it, or boost your savings?
This is a question we hear a lot, and it just so happens that [...]
Tim Manni, Keith Gumbinger, admin
