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Mortgage Bankers Weekly Update:Mortgage Applications Increase the Week After Christmas

Posted by Howard Bell on January 5, 2011 at 4:10pm
Mortgage Bankers Association for the week of 01/5/2010

Market Composite Index: (loan application volume) d ecreased 3.9 percent on a seasonally adjusted basis from the prior week. For the week ending December 31, 2010, this index increased 2.3 percent on a seasonally adjusted basis.

Refinance Index: decreased 7.2 percent from the previous week and the seasonally adjusted Purchase Index increased 3.1 percent from one week earlier. The following week, the Refinance Index increased 3.9 percent and the seasonally adjusted Purchase Index decreased 0.8 percent

Purchase Index: decreased 18.1 percent the week before Christmas and decreased 12.2 percent the week following. This measure was 12.1 percent higher and 6.1 percent lower, respectively, than the same period a year ago.

Refinance Share of Mortgage Activity: for the week ending December 31, 2010 was 71.0 percent, an increase from 70.3 percent for the week ending December 24, 2010.

Arm Share: No info available this week

MBA outlook: (Excerpted from mbaa.org)

The financial markets response to the announcement of QE2 on November 3 has likely been a disappointment to the Fed. Equity prices have risen, but long-term rates have backed up considerably, with the yield on the 10-year Treasury pushing up past 3%. And turmoil in Europe has led to an increase in the value of the dollar in exchange markets, not the decline that had been expected in response to QE2. Had the Feds proposal for renewed large-scale asset purchases been well received, Fed officials might now be considering increasing the announced rate of purchases to $100 billion per month or more. But dong so under present circumstances would likely evoke a political firestorm.

The percentage of loans on which foreclosure actions were started during the third quarter was 1.34 percent, up 23 basis points from last quarter and down eight basis points from one year ago. The percentage of loans in the foreclosure process at the end of the third quarter was 4.39 percent, down 18 basis points from the second quarter of 2010 and down eight basis points from one year ago. The seriously delinquent rate, the percentage of loans that are 90 days or more past due or in the process of foreclosure, was 8.70 percent, a decrease of 41 basis points from last quarter, and a decrease of 15 basis points from the third quarter of last year.

We expect that mortgage originations will decrease to $967 billion in 2011, the lowest level of originations since 1997. This is a decline from $1.5 trillion in 2010 and a little under $2.0 trillion in 2009. Purchase originations should increase to $615 billion in 2011 up from $473 billion in 2010. Refinance originations, primarily impacted by the level of mortgage rates, are expected to drop sharply in 2011 to $352 billion and fall further in 2012 to $237 billion. We expect that the refinance share of originations should fall from 69 percent in 2010 to 36 percent in 2011, and then 24 percent in 2012 as rates climb above the 6 percent mark.

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Mortgage Bankers Weekly Update: Mortgage Applications Decrease

Posted by Howard Bell on December 11, 2010 at 4:00pm

Mortgage Bankers Association for the week of 12/8/2010

Market Composite Index:(loan application volume) decreased 0.9 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 22.8 percent compared with the previous week, which included the Thanksgiving Holiday

Refinance Index: decreased 1.4 percent from the previous week. This is the fourth weekly decrease for the Refinance Index which reached its lowest level since June 2010

Purchase Index: increased 1.8 percent from one week earlier. This is the third weekly increase for the Purchase Index which reached its highest level since early May 2010. The unadjusted Purchase Index increased 21.3 percent compared with the previous week and was 12.0 percent lower than the same week one year ago.

Refinance Share of Mortgage Activity: increased to 75.2 percent of total applications from 74.9 percent the previous week

Arm Share: decreased to 5.6 percent from 5.7 percent of total applications from the previous week.

MBA outlook: (Excerpted from mbaa.org) The delinquency rate for mortgage loans on one-to-four-unit residential properties decreased to a seasonally adjusted rate of 9.13 percent of all loans outstanding as of the end of the third quarter of 2010, a decrease of 72 basis points from the second quarter of 2010, and a decrease of 51 basis points from one year ago, according to the Mortgage Bankers Association’s (MBA) National Delinquency Survey. The percentage of loans on which foreclosure actions were started during the third quarter was 1.34 percent, up 23 basis points from last quarter and down eight basis points from one year ago. The percentage of loans in the foreclosure process at the end of the third quarter was 4.39 percent, down 18 basis points from the second quarter of 2010 and down eight basis points from one year ago. The seriously delinquent rate, the percentage of loans that are 90 days or more past due or in the process of foreclosure, was 8.70 percent, a decrease of 41 basis points from last quarter, and a decrease of 15 basis points from the third quarter of last year. We expect that mortgage originations will decrease to $1.4 trillion in 2010 from a downwardly revised $2.0 trillion in 2009, previously estimated at $2.1 trillion. Total originations will then fall to $996 billion in 2011, the lowest level of originations since 1997. Purchase activity in 2010 will see a significant drop from 2009, although it was given a brief boost in the spring by the tax credit program, but start to recover in 2011. Refinance activity is currently being buoyed by mortgage rates that remain close to historical lows, but will fall in 2011 and 2012 as rates start to increase. Purchase originations will fall to $480 billion from $665 billion in 2009 and refinance originations will decrease to about $921 billion in 2010 from $1.3 trillion in 2009. We expect that the refinance share of originations should fall from 66 percent in 2010 to 37 percent in 2011, and then 26 percent in 2012.

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Freddie Mac Weekly Update: Bond Yields Rise and So Do Mortgage Rates

Posted by Howard Bell on December 11, 2010 at 4:00pm

30-year fixed-rate mortgage: Averaged 4.61 percent with an average 0.7 point for the week ending December 9, 2010, up from last week when it averaged 4.46 percent. Last year at this time, the 30-year FRM averaged 4.81 percent.

The 15-year fixed-rate mortgage: Averaged 3.96 percent with an average 0.7 point, up from last week when it averaged 3.81 percent. A year ago at this time, the 15-year FRM averaged 4.32 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 3.60 percent this week, with an average 0.6 point, up from last week when it averaged 3.49 percent. A year ago, the 5-year ARM averaged 4.26 percent.

One-year Treasury-indexed ARMs: Averaged 3.27 percent this week with an average 0.6 point, up from last week when it averaged 3.25 percent. At this time last year, the 1-year ARM averaged 4.24 percent.

Freddie Sayz Attributed to Frank Nothaft, vice president and chief economist, Freddie Mac. After Europe made strides in its debt situation, investors left the security of U.S. Treasury debt causing bond yields to rise and mortgage rates along with them. Interest rates for 30 year fixed mortgages are now almost a half percentage point higher than the record low set in mid November, which for a $200,000 conventional loan amounts to $50 more in monthly payments. Housing demand appears to be picking up recently. Existing pending sales jumped 10.4 percent in October to the strongest pace since April, according to the National Association of Realtors. More recently, mortgage applications for home purchases rose for the three consecutive weeks ending on December 3rd, representing a 17.7 percent increase and the strongest pace since the week of May 7th, based on figures released by the Mortgage Bankers Association Maximizing The Rent

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Mortgage Interest Deduction Going Away…….A Good Thing?

Posted by Jesus (Jesse) Gonzalez on December 6, 2010 at 3:56am

Regardless if you are for or against making changes to the Mortgage Interest Tax Deduction, lets first talk about what this tax deduction really is.

The mortgage interest deduction is a social entitlement. Like all other social entitlements, it does the following.

1. Allows the government to directly influence free markets.

2. Has a continual growth pattern, never retracts.

3. Replaces the power of the individual citizen with the power of special interest.

4. Progresses a Socialist / Progressive agenda

Point # 1:

The Mortgage Interest Deduction is a tax deduction that came into existence back in 1986 with the Tax Reform Act of 1986. The decision to create the tax deduction was done so under the belief it would encourage homeownership. As many of us learned with the recent real estate bubble bursting, it’s my belief and opinion that anytime our Government decides to artificially influence free markets in the name of “progress”, it may not actually be a good idea. Yes, I do believe Government has a role but, I do not believe it should be in the business of creating “incentives”. As we have learned, Government incentives can artificially inflate segments of our economy that can ultimately burst.

Secondly, I don’t believe America was built on an ideology of Government handouts or incentives, at least not the America I grew up in. We are a self reliant people, we are a charitable people, we are not socialist or progressives who believe in large or more Government.

Point # 2:

As we are learning from Europe, social entitlements do not retract or go away. They grow and grow and grow till, they end up eating all the money and collapse under their own financial weight. Sadly, I wish I could say America hasn’t made any of these types of entitlement mistakes however, we have with healthcare and social security.

Social security is bankrupt and we are currently paying our elderly, retired and disabled with debt. Social security is crippling this country and we are looking at posterity measures not to save social security but to keep our country from financial ruin.

The recent healthcare passage is another entitlement that is raping our children’s future. I don’t know about your household expenses but, we are going to see a 2,500.00 rise in 2011 in our health care insurance and that was directly contributed to “obamacare” in a nice little letter from our insurance provider. Even the CBO, Congressional Budget Office is warning now that cost predictions were off and healthcare has the potential to bankrupt this country.

So, to my point, how many of you can even stomach the idea of ending social security? I venture to say, none of you.

Point # 3:

Social entitlements are just that “social”. In other words, it’s a form of collectivism that removes the voice of the individual for the voice of the collective good. The problem with this is, the “collective good” is nothing more than a pipe dream. You see, we are all individuals, we are all different, we all have our own likes and dislikes and therefore, we can never have a 100% collective good. So, instead of social entitlements offering a “good” to everyone, they just end up offering a “good” to those who would be directly impacted.

For example, the Mortgage Interest Deduction doesn’t do any good for people who aren’t buying or own a home so, it doesn’t help everyone. Social security only helps the elderly, retired, disabled but, if you are a 25 years old, healthy working person, you pay into a bankrupt system that chances are, you will never use because, by the time you qualify, it will be collapsed.

Social entitlement create population segments that are segregated based on the qualification for the benefit. It’s a form of class warfare.

Point # 4:

Social entitlement moves our country away from the Republic we were created to be and moves us towards a more socialist, progressive Government where our constitution is made irrelevant and our elected officials, loose their power and the individual citizen become non-existent. This isn’t the American way.

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Mortgage Bankers Weekly Update: Mortgage Purchase Applications Increase

Posted by Howard Bell on November 26, 2010 at 11:24am

Mortgage Bankers Association for the week of 11/24/2010

Market Composite Index: (loan application volume) increased 2.1 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 1.1 percent compared with the previous week.

Refinance Index: decreased 1.0 percent from the previous week and is the lowest Refinance Index observed since the end of June.

Purchase Index: increased 14.4 percent from one week earlier, which included Veterans Day. No adjustment was made for the holiday. On a seasonally adjusted basis, this is the highest Purchase Index recorded since the week ending May 7, 2010. The unadjusted Purchase Index increased 9.6 percent compared with the previous week and was 7.4 percent lower than the same week one year ago
decreased to 78.6 percent of total applications from 80.3 percent the previous week.

Refinance Share of Mortgage Activity: decreased to 80.3 percent of total applications from 81.7 percent the previous week.

Arm Share: share of activity remained constant at 5.3 percent of total applications.

MBA outlook: (Excerpted from mbaa.org)

The delinquency rate for mortgage loans on one-to-four-unit residential properties decreased to a seasonally adjusted rate of 9.13 percent of all loans outstanding as of the end of the third quarter of 2010, a decrease of 72 basis points from the second quarter of 2010, and a decrease of 51 basis points from one year ago, according to the Mortgage Bankers Associations (MBA) National Delinquency Survey.

The percentage of loans on which foreclosure actions were started during the third quarter was 1.34 percent, up 23 basis points from last quarter and down eight basis points from one year ago. The percentage of loans in the foreclosure process at the end of the third quarter was 4.39 percent, down 18 basis points from the second quarter of 2010 and down eight basis points from one year ago. The seriously delinquent rate, the percentage of loans that are 90 days or more past due or in the process of foreclosure, was 8.70 percent, a decrease of 41 basis points from last quarter, and a decrease of 15 basis points from the third quarter of last year.

We expect that mortgage originations will decrease to $1.4 trillion in 2010 from a downwardly revised $2.0 trillion in 2009, previously estimated at $2.1 trillion. Total originations will then fall to $996 billion in 2011, the lowest level of originations since 1997. Purchase activity in 2010 will see a significant drop from 2009, although it was given a brief boost in the spring by the tax credit program, but start to recover in 2011. Refinance activity is currently being buoyed by mortgage rates that remain close to historical lows, but will fall in 2011 and 2012 as rates start to increase. Purchase originations will fall to $480 billion from $665 billion in 2009 and refinance originations will decrease to about $921 billion in 2010 from $1.3 trillion in 2009. We expect that the refinance share of originations should fall from 66 percent in 2010 to 37 percent in 2011, and then 26 percent in 2012.

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Freddie Mac Weekly Update: Mortgage Rates Stable

Posted by Howard Bell on November 26, 2010 at 11:24am
30-year fixed-rate mortgage: Averaged 4.40 percent with an average 0.8 point for the week ending November 24, 2010, up slightly from last week when it averaged 4.39 percent. Last year at this time, the 30-year FRM averaged 4.78 percent.

The 15-year fixed-rate mortgage: Averaged 3.77 percent with an average 0.7 point, up slightly from last week when it averaged 3.76 percent. A year ago at this time, the 15-year FRM averaged 4.29 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 3.45 percent this week, with an average 0.6 point, up from last week when it averaged 3.40 percent. A year ago, the 5-year ARM averaged 4.18 percent.

One-year Treasury-indexed ARMs: Average 0.6 point, down from last week when it averaged 3.26 percent. At this time last year, the 1-year ARM averaged 4.35 percent

Freddie Sayz

Attributed to Frank Nothaft, vice president and chief economist, Freddie Mac.
During a holiday shortened week, average mortgage rates were largely unchanged from the prior week. Growth in gross domestic product in the third quarter was revised up from the initial estimate to an annualized rate of 2.5 percent, as stronger consumer spending and exports supported the revision.

Homeowner balance sheets are also improving. Mortgage delinquency rates continued to move down in the third quarter, with the overall delinquency rate falling to 9.13 percent, the lowest since the first quarter of 2009. For the first time during the housing downturn, the overall delinquency rate is lower than it was a year earlier.

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New Mortgage Program Will Help Millions

Posted by Howard Bell on November 3, 2010 at 11:39am
By some authorities, An estimated 5.5 million homeowners facing imminent foreclosure. The Obama Administration has provided some immediate relief with the HEMA program. HEMA will use up to $3 billion TARP to make funds available for unemployed homeowners and those suffering financial distress. Eligibility is designed to help those who have lost their jobs or are in great financial distress for 24 months. The program will offer up to $50,000 at 0% interest for 24 months to help homeowners through difficult situations.

Requirements
1.Borrowers must have a track record of making mortgage payments on time.
2.It must be the primary residence and at risk of foreclosure.
3. Combined household income must not exceed 120% of the median income in the area.
If eligible, a homeowner makes a fractional payment to the Department of Housing and Urban Development (HUD) instead of the lender. Provided the homeowner has a reasonable probability of resuming mortgage payments, HUD will assume full payment to the lender. Once the homeowners immediate financial problems are resolved, they re-assume full responsibility for the mortgage and pay back the HUD for the temporary loan.

Funding is not available in all states, only the hardest hit and the program is funded with 1 billion now and hopefully more later, depending on the success of the program. HUD counts 32 states and Puerto Rico as recipients of the HEMA program. Borrowers must meet with their local NeighborWorks. HUD hopes to begin accepting applications by the end of the year.

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Freddie Mac Weekly Mortgage Update: 30-Year Mortgage Rate Ties Low While 15 Year Sets New Record

Posted by Howard Bell on October 7, 2010 at 11:59am
30-year fixed-rate mortgage: Averaged 4.32 percent with an average 0.8 point for the week ending September 30, 2010, down from last week when it averaged 4.37 percent. Last year at this time, the 30-year FRM averaged 4.94 percent.

The 15-year fixed-rate mortgage: Averaged a record low of 3.75 percent with an average 0.7 point , down from last week when it averaged 3.82 percent. A year ago at this time, the 15-year FRM averaged 4.36 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 3.52 percent this week, with an average 0.6 point , down from last week when it averaged 3.54 percent. A year ago, the 5-year ARM averaged 4.42 percent.

One-year Treasury-indexed ARMs: Averaged 3.48 percent this week with an average 0.7 point, up from last week when it averaged 3.46 percent. At this time last year, the 1-year ARM averaged 4.49 percent.

Freddie Sayz

Attributed to Frank Nothaft, vice president and chief economist, Freddie Mac.

Confidence in the state of the economy fell among consumers and businesses, which led to a decline in long term bond yields and brought many mortgage rates to record lows this week. The September Consumer Confidence Index by the Conference Board fell to the lowest level since February of this year, while the Business Roundtable CEO Business Outlook for the third quarter was the weakest in the past four quarters. Consequently, rates for the 15 year fixed mortgage and the 5 year hybrid ARM reached new all-time lows and rates for 30-year fixed mortgages tied its record set just four weeks ago.

Homeowners have regained $1.0 trillion in home equity as of the second quarter of 2010 after losing more than $7.5 trillion over the three year period ending in the first quarter of 2009, the Federal Reserve Board reported. This, in part, strengthened household balance sheets and reduced serious mortgage delinquencies. For instance, first mortgages 90 days delinquent or worse fell to 3.16% in August from 4.76% a year prior and was the lowest rate since June 2008, according to the S&P/Experian Consumer Credit Default Indices .

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Mortgage Bankers Weekly Update: Sharp Jump in Purchases Led by Applications for FHA Loans

Posted by Howard Bell on October 7, 2010 at 11:59am
Mortgage Bankers Association for the week of 09/22/2010

Market Composite Index: (loan application volume) decreased 0.2 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 0.3 percent compared with the previous week

Refinance Index: decreased 2.5 percent from the previous week. The unadjusted Purchase Index increased 9.1 percent compared with the previous week and was 34.7 percent lower than the same week one year ago.

Purchase Index: decreased to 78.9 percent of total applications from 80.7 percent the previous week.

Refinance Share of Mortgage Activity: decreased to 78.9 percent of total applications from 80.7 percent the previous week.
increased to 6.1 percent from 6.0 percent of total applications from the previous week.

Arm Share: decreased to 5.9 percent from 6.2 percent of total applications from the previous week.

MBA outlook: (Excerpted from mbaa.org)

We predict that mortgage originations will decrease to $1.4 trillion in 2010 from an estimated $2.1 trillion in 2009. Purchase activity continues to be weak, although it was given a brief boost in the spring by the tax credit program, while refinance activity is being propped up by mortgage rates that remain close to historical lows, although there is less refinancing going on now than in previous periods of comparably low mortgage rates. Purchase originations will fall to $539 billion from $740 billion in 2009 and refinance originations will decrease to about $910 billion in 2010 from $1.4 trillion in 2009. This months originations estimates for 2010 forward were revised downwards to reflect the weaker July data for home sales and housing starts.

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FHA Reforms Shift The Game

Posted by Howard Bell on September 19, 2010 at 12:10pm
The coming FHA reforms will help stabilize FHA's financial viability. FHA will be allowed to raise premiums. The cap on the maximum annual FHA insurance premium increases from 0.5% to 1.5% and for loans with high loan To Value ratios, 0.55% to 1.55%. But the real importance is how the reforms will shift liquidity to rental property.

Multi Family
The bill also increases FHA's multifamily loan limits for elevator buildings and buildings in high cost areas, helping lenders finance the construction and rehab of rental housing.

Sales volume is up, debt and equity financing are more available and indexes for both sales volume and equity financing registered all-time highs. Apartment market conditions continue to improve across the spectrum said NMHC Chief Economist Mark Obrinsky.

The Politics Of Housing Shifts
Multi Family is a winner

Liquidity provided by Fannie and Freddie has enabled the apartment industry to build and maintain millions of units, including an overwhelming number of market-rate apartment properties needing no federal subsidies. With the Govt needing to repair its balance sheet, this is the better asset to back.

Rental Markets
Mark Zandi, chief economist at Moody's Analytics adds not everyone can or should have a single-family home. After the single family home market collapsed, many began looking at a major distortion in the markets...government support in the housing market is disproportionately larger for homeownership than rental units.

The Congressional Budget Office reported, the government in 2009, devoted nearly four times as much to support homeownership.$230 billion for homes and about $60 billion for multi family property.

Money always finds a home and opportunity follows. Given limited Government dollars, it stands to reason, going forward that liquidity and sales will shift to the rental property arena at the expense of single family homes.

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You may republish this article, as long as you do not edit and you agree to preserve all links to the author and www.yourpropertypath.com

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FHA Offers Short Refi Program For Underwater Homeowners

Posted by Howard Bell on September 8, 2010 at 12:40pm
FHA Offers Short Refi Program For Underwater Homeowners In an effort to help responsible homeowners who owe more on their mortgage than the value of their property HUD adjusted its refinance program. The changes will enable lenders to provide additional refinancing options to underwater homeowners. see chart

Starting September 7, 2010, FHA will offer some underwater non FHA borrowers the opportunity to qualify for a new FHA insured mortgage. Designed to meet its goal of stabilizing housing markets, by helping 3 to 4 million homeowners through 2012.

FHA provided some guidance

Participation in FHA's refinance program is voluntary and requires the consent of all lien holders. To be eligible for a new loan:

1. The homeowner must owe more on their mortgage than their home is worth and be current on their existing mortgage.
2. The homeowner must qualify for the new loan under standard FHA underwriting requirements and have a credit score equal to or greater than 500.
3 The property must be the homeowner's primary residence.
4. And the borrower's existing first lien holder must agree to write off at least 10% of their unpaid principal balance, bringing that borrower's combined loan-to-value ratio to no greater than 115%.
5.The existing loan to be refinanced must not be an FHA-insured loan, and the refinanced FHA-insured first mortgage must have a loan-to-value ratio of no more than 97.75 percent.

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Freddie Mac Weekly Mortgage Update: Long-Term Mortgage Rates Fall for the Ninth Week Out of Ten

Posted by Howard Bell on August 28, 2010 at 10:06am

30-year fixed-rate mortgage: Averaged 4.36 percent with an average 0.7 point for the week ending August 26, 2010, down from last week when it averaged 4.42 percent. Last year at this time, the 30-year FRM averaged 5.14 percent.

The 15-year fixed-rate mortgage: Averaged a record low of 3.86 percent with an average 0.6 point, down from last week when it averaged 3.90 percent. A year ago at this time, the 15-year FRM averaged 4.58 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 3.56 percent this week, with an average 0.6 point, unchanged from last week when it also averaged 3.56 percent. A year ago, the 5-year ARM averaged 4.67 percent.

One-year Treasury-indexed ARMs: Averaged 3.52 percent this week with an average 0.7 point, down slightly from last week when it also averaged 3.53 percent. At this time last year, the 1-year ARM averaged 4.69 percent.

Freddie Sayz
Attributed to Amy Crews Cutts, deputy chief economist, Freddie Mac.

Existing home sales plunged 27 percent in July, while new homes fell 12% to a new all-time record low, which led to some market concerns that the housing market may slow the economic recovery. As a result, long-term bond yields fell to the lowest levels since January 2009, allowing fixed mortgage rates to ease to new record lows this week.

Much of the slowdown in sales, however, was expected due to the recently expired homebuyer tax programs, which pulled through future home purchases into the first half of the year. For instance, average existing home sales over the first seven months of 2010 were nearly 8 percent higher than over the same period a year ago.
Moreover, house prices still appear to be stabilizing. Nationally, house prices rose 0.9 percent on a seasonally-adjusted basis during the second quarter of this year this year after 11 consecutive quarterly declines,

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Mortgage Bankers Weekly Update: Mortgage Refinance Applications Continue to Increase

Posted by Howard Bell on August 28, 2010 at 10:05am
Mortgage Bankers Association for the week of 08/25/2010

Market Composite Index: (loan application volume) increased 4.9 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 4.5 percent compared with the previous week.

Refinance Index: increased 5.7 percent from the previous week and is at its highest level since May 1, 2009. The seasonally adjusted Purchase Index increased 0.6 percent from one week earlier.

Purchase Index: decreased 1.1 percent compared with the previous week and was 38.8 percent lower than the same week one year ago.

Refinance Share of Mortgage Activity: increased to 82.4 percent of total applications from 81.4 percent the previous week, which is the highest share observed since January 2009.
Arm Share: increased to 5.8 percent from 5.7 percent of total applications from the previous week.

MBA outlook: (Excerpted from mbaa.org)

Existing home sales in June declined 5.1 percent to a seasonally adjusted annual rate of 5.37 million units from 5.66 million in May, and are 9.8 percent higher than in June of last year. Single family home sales fell 5.6 percent to 4.70 million units in June from 4.98 million units in May, and are 8.5 percent above the pace in June 2009. For both total existing home sales and single family home sales, the monthly decrease was the largest since January this year. We predict that mortgage originations will decrease to $1.5 trillion in 2010 from an estimated $2.1 trillion in 2009. Purchase activity continues to be weak, while refinance activity is being propped up by mortgage rates that are close to historical lows, although there is much less refinancing going on now than in previous periods of comparably low mortgage rates. Purchase originations will fall to $576 billion from $750 billion in 2009 and refinance originations will decrease to about $900 billion in 2010 from $1.2 trillion in 2009.

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Mortgage Bankers Weekly Update: Essentially Unchanged Despite Lowest Rates

Posted by Howard Bell on August 14, 2010 at 10:15am
Mortgage Bankers Association for the week of 08/11/2010

Market Composite Index: (loan application volume) increased 0.6 percent on a seaso
nally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 0.4 percent compared with the previous week.

Refinance Index: increased 0.6 percent from the previous week and the seasonally adjusted Purchase Index increased 0.3 percent from one week earlier.

Purchase Index: decreased 0.3 percent compared with the previous week and was 34.1 percent lower than the same week one year ago.

Refinance Share of Mortgage Activity: increased to 78.1 percent of total applications from 78.0 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 5.9 percent from 5.4 percent of total applications from the previous week.

Arm Share: increased to 5.9 percent from 5.4 percent of total applications from the previous week.

MBA outlook: (Excerpted from mbaa.org)

Federal Reserve policymakers have been increasingly clear that they will keep their target rate at exceptionally low levels for an extended perio d. They have also made no moves to this point in terms of asset sales from their trillion dollar portfolio of mortgage backed securities. Fannie Mae and Freddie Macs large buyouts of delinquent loans from MBS have substantially been completed by this point, so there are no longer large-scale purchases of MBS by unconventional buyers artificially constraining mortgage rates. However, continued financial turmoil appears to have led many investors, including international buyers, to favor MBS, and new issuance remains quite low.

We predict that mortgage originations will fall to $1.48 trillion in 2010 from an estimated $2.1 trillion in 2009. Purchase originations will decrease 7 percent to $686 billion, as home prices continue to fall and the boost from the homebuyer tax credits wane. Refinance originations will fall by about 42 percent to $797 billion in 2010. We continue to mark up our refinance origination forecast given that mortgage rates have continued to remain close to historical lows.

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Freddie Mac Weekly Mortgage Update: Mortgage Rates Fall Again

Posted by Howard Bell on August 14, 2010 at 10:14am
30-year fixed-rate mortgage: Averaged 4.44 percent with an average 0.7 point for the week ending August 12, 2010, down from last week when it averaged 4.49 percent. Last year at this time, the 30-year FRM averaged 5.29 percent.

The 15-year fixed-rate mortgage: Averaged a record low of 3.92 percent with an average 0.6 point, down from last week when it averaged 3.95 percent. A year ago at this time, the 15-year FRM averaged 4.68 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 3.56 percent this week, with an average 0.7 point, down from last week when it averaged 3.63 percent. A year ago, the 5-year ARM averaged 4.75 percent.

One-year Treasury-indexed ARMs: Averaged 3.55 percent this week with an average 0.7 point, down from last week when it averaged 3.64 percent. At this time last year, the 1-year ARM averaged 4.78 percent

Freddie Sayz

Interest rates for fixed mortgages and 5 year hybrid ARMs again broke record lows this week following reports of a sluggish job market. Private payrolls increased by 71,000 jobs in July, below the market consensus forecast, and revisions shaved June's growth by 34,000 workers.

The Federal Reserve also noted in its August 10th policy statement that the pace of recovery in output and employment slowed since its last meeting in June. Low rates are helping to heal many battered local housing markets by increasing home purchase activity. The National Association of Realtors reported that 65 percent of the 155 metropolitan areas they track experienced yearly increases in the second quarter of this year. This compares to 60 percent of areas in the first quarter and only 44 percent in the fourth quarter of 2009

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Mortgage Bankers Weekly Update: Mortgage Applications Increase

Posted by Howard Bell on August 5, 2010 at 1:45pm
Mortgage Bankers Association for the week of 07/28/2010

Market Composite Index: (loan application volume) increased 1.3 percent on a seasonally adjusted basis from one week earlier.

Refinance Index: increased 1.3 percent from the previous week

Purchase Index: increased 1.5 percent from one week earlier. This third straight weekly increase in the Purchase Index was driven by government purchase applications which increased 3.4 percent from last week, while conventional purchase applications were essentially flat.

Refinance Share of Mortgage Activity: increased 1.3 percent from the previous week.

Arm Share: decreased to 5.4 percent from 5.7 percent of total applications from the previous week.

MBA outlook: (Excerpted from mbaa.org)

We predict that mortgage originations will fall to $1.48 trillion in 2010 from an estimated $2.1 trillion in 2009. Purchase originations will decrease 7 percent to $686 billion, as home prices continue to fall and the boost from the homebuyer tax credits wane. Refinance originations will fall by about 42 percent to $797 billion in 2010. We continue to mark up our refinance origination forecast given that mortgage rates have continued to remain close to historical lows.

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Freddie Mac Weekly Mortgage Update: Mortgage Rates Down Again

Posted by Howard Bell on August 5, 2010 at 1:45pm

30-year fixed-rate mortgage: Averaged 4.49 percent with an average 0.7 point for the week ending August 5, 2010, down from last week when it averaged 4.54 percent. Last year at this time, the 30-year FRM averaged 5.22 percent.

The 15-year fixed-rate mortgage: Averaged a record low of 3.95 percent with an average 0.6 point, down from last week when it averaged 4.00 percent. A year ago at this time, the 15-year FRM averaged 4.63 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 3.63 percent this week, with an average 0.6 point, down from last week when it averaged 3.76 percent. A year ago, the 5-year ARM averaged 4.73 percent.

One-year Treasury-indexed ARMs: Averaged 3.55 percent this week with an average 0.7 point, down from last week when it averaged 3.64 percent. At this time last year, the 1-year ARM averaged 4.78 percent

Freddie Sayz

And yet again, interest rates for fixed-rate mortgages and now the hybrid 5-year ARM fell to all-time record lows this week following the second quarter GDP release . Annual revisions cut the cumulative GDP growth in half over the past three years ending in the first quarter of 2010 from 1.4 percent to 0.6 percent. This reduces inflationary pressures and allows longer-term rates room to ease.

More recently, housing investment picked up in the second quarter of this year as the homebuyer tax credit spurred new and existing sales and low mortgage rates encouraged remodeling. Fixed residential investment added 0.6 percentage points to second quarter real GDP growth following two quarters of decline

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Freddie Mac Weekly Mortgage Update: Rates Inch Downward to Another New Low

Posted by Howard Bell on July 31, 2010 at 3:51pm
30-year fixed-rate mortgage: Averaged 4.54 percent with an average 0.7 point for the week ending July 29, 2010, down from last week when it averaged 4.56 percent. Last year at this time, the 30-year FRM averaged 5.25 percent.

The 15-year fixed-rate mortgage: Averaged a record low of 4.00 percent with an average 0.7 point , down from last week when it averaged 4.03 percent. A year ago at this time, the 15-year FRM averaged 4.69 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 3.76 percent this week, with an average 0.7 point, down from last week when it averaged 3.79 percent. A year ago, the 5-year ARM averaged 4.75 percent.

One-year Treasury-indexed ARMs: Averaged 3.64 percent this week with an average 0.7 point, down from last week when it averaged 3.70 percent. At this time last year, the 1-year ARM averaged 4.80 percent

Freddie Sayz

For the sixth week in a row, interest rates on fixed rate mortgages eased to all time record lows during a week of mixed housing data reports. The number of local markets experiencing annual increases in home prices appears to be growing. For instance, 13 metropolitan areas in the S&P/Case-Shiller 20 city index experienced price appreciation over the 12-months ending in May, compared to 11 in April and 10 in March.
However, existing home sales in June slowed to an annualized pace of 4.37 million units, the fewest since March. Moreover, although new home sales jumped by almost 24 percent to 330,000 dwellings, it represented the second slowest rate since 1963

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Mortgage Bankers Weekly Update: Mortgage Applications Decrease

Posted by Howard Bell on July 31, 2010 at 3:51pm
Mortgage Bankers Association for the week of 07/28/2010

Market Composite Index: (loan application volume) decreased 4.4 percent on a seasonally adjusted basis from one week earlier

Refinance Index: decreased 5.9 percent from the previous week.

Purchase Index: increased 2.0 percent from one week earlier and is the highest Purchase Index observed in the survey since the end of June

Refinance Share of Mortgage Activity: decreased to 78.0 percent of total applications from 79.4 percent the previous week.

Arm Share: increased to 5.7 percent from 5.2 percent of total applications from the previous week.

MBA outlook: (Excerpted from mbaa.org)

Federal Reserve policymakers have been increasingly clear that they will keep their target rate at exceptionally low levels for an extended period. They have also made no moves to this point in terms of asset sales from their trillion dollar portfolio of mortgage backed securities. Fannie Mae and Freddie Macs large buyouts of delinquent loans from MBS have substantially been completed by this point, so there are no longer large-scale purchases of MBS by unconventional buyers artificially constraining mortgage rates .

Purchase application data from MBAs Weekly Application Survey show no rebound in activity to date, with apps remaining at 13 year lows (15-year lows for conventional purchase mortgages). As the pending home sales and housing starts numbers showed, this drop in applications clearly predicts similar sized drops in home sales over the next couple of months.

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Mortgage Bankers Weekly Update: Mortgage Refinance Applications Increase

Posted by Howard Bell on July 18, 2010 at 12:08pm
Mortgage Bankers Association for the week of 07/07/2010

Market Composite Index: (loan application volume) increased 6.7 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 6.5 percent compared with the previous week.

Refinance Index: increased 9.2 percent from the previous week and is the highest Refinance Index observed in the survey since the week ending May 15, 2009

Purchase Index: has decreased eight of the last nine weeks

Refinance Share of Mortgage Activity: increased to 78.7 percent of total applications from 76.8 percent the previous week, which is the highest refinance share observed in the survey since April 2009.

Arm Share: increased to 5.4 percent from 4.7 percent of total applications from the previous week.

MBA outlook: (Excerpted from mbaa.org)

Mortgage rates remained near record lows last week, as incoming data on the job and housing markets were weaker than anticipated. As more homeowners locked in to these low rates, the level of refinance applications increased to a new 13-month high, said Michael Fratantoni, MBAs Vice President of Research and Economics. For the month of June, purchase applications declined almost 15% relative to the prior month, and were down more than 30% compared to April, the last month in which buyers were eligible for the tax credit.

We predict that mortgage originations will fall to $1.4 trillion in 2010 from an estimated $2.1 trillion in 2009. Purchase originations will fall slightly to $725 billion, as home prices continue to fall and the effect from the homebuyer tax credits wane. Refinance originations will fall to $717 billion in 2010 from $1.4 trillion in 2009, but we continue to mark up our refinance origination forecast given the sharp drop in mortgage rates.

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