Fannie's Forecast Sees a Brightening Recovery

Posted To: MND NewsWire

Fannie Mae has upgraded its forecast for the third quarter gross domestic product (GDP). It now expects growth at an annualized pace of 30.4 percent , up from the 27.2 percent the company’s economists predicted in August. They say that growth has clearly slowed from the days soon after the business shutdowns and orders to shelter in place were gradually lifted by states and cities in May and June, but more recent data points to a continued recovery. It was originally thought that personal consumption expenditures would fall off significantly as expanded unemployment benefits expired, but they rose 1.6 percent in July, and early data for August suggest that growth continued. Auto sales, one component of the PCE, rose 4.5 percent and credit and debit card transactions appear to have increased…(read more)

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Source: Mortgage News Daily

MLO, Ops Jobs; Retention, Co-op Products; USDA Rural Conditional Commitments

Posted To: Pipeline Press

If you watch the news long enough, you see all kinds of interesting things. Cracker Barrel is adding alcohol to its menu? Yup! And you must watch this clip with Stephen Colbert working out with, and interviewing, the Notorious RBG (“Is a hot dog a sandwich?”) a few years back. We watched Lee Farkas be released from prison after only 9 years. What are small independent mortgage bankers, and every other lender for that matter, watching? How about concerns and questions about loans with Agencies’ indemnification/recourse, that are now in forbearance, hitting the 120-day delinquency repurchase trigger ? My guess is that details are under review and you should ask your Agency rep for details, but if your net worth is $4 million, and in the next month you receive buyback requests…(read more)

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Source: Mortgage News Daily

MBS Week Ahead: Who Knows Where We'd Be Without Stock Market Weakness

Posted To: MBS Commentary

One of my favorite pastimes is debunking the notion that stock prices and bonds yields 'always' correlate. Years of indoctrination from the conventional wisdom of money managers have done us no favors as market watchers. Even if you don't invest or actively make decisions about your 401k allocation, you're still likely familiar with the notion of moving out of stocks/bonds and into the other. The net effect of such asset allocation strategy is simple . If you're selling stocks to buy bonds, then charted lines of stock prices and bond yields would move lower together (because buying bonds = higher prices and lower yields). This line of thinking makes the following stock/bond movement in early September very logical. Indeed, looking at the chart above, it's easy to conclude…(read more)

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Source: Mortgage News Daily

Here's What The Fed's 0% Rate Outlook Means For Mortgages and Housing

Posted To: Mortgage Rate Watch

Mortgage rates are most influenced by the bond market and the bond market is most influenced by the Federal Reserve (aka “The Fed”). So when the Fed says it expects rates to be “zero” at least until the end of 2023, does the same go for mortgage rates? That would be nice, but unfortunately, that’s not how it works. The Fed dropped its policy rate to 0% back in March–the same place it had been for nearly 6 years after the financial crisis. Mortgage rates were in completely different territory during that time and they’ve often moved in the opposite direction since then. With this in mind, how can we say the Fed is so important to the bond market and mortgage rates? First off, there’s a clue in the chart above. Although we can highlight time frames where the two rates moved in opposite directions…(read more)

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Source: Mortgage News Daily

MBS RECAP: Range Trading Settling in For Long(er) Haul

Posted To: MBS Commentary

Range Trading Settling in For Long(er) Haul With no significant bond market volatility in response to this week's Fed announcement. The question of "where do we go now" remains. The answer remains as well. Until further notice, it's "sideways!" Econ Data / Events 20min of Fed 30yr UMBS Buying 10am, 1130am (M-F) and 1pm (T-Th) Consumer Sentiment 78.9 vs 75.0 f'cast , 74.1 prev Market Movement Recap 08:20 AM Bonds were mostly flat during Asian hours but rallied during European hours to hit the domestic session in slightly stronger territory. 10yr yields are down 1.6bps at .672 and 2.0 UMBS are up 1 tick at 102.98. Stocks are flat. 01:44 PM AM weakness in MBS subsided by noon. Treasury yields managed to find a ceiling without moving too far into negative territory…(read more)

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Source: Mortgage News Daily

Fewer Homes Being Flipped, But Profits Are Up

Posted To: MND NewsWire

One out of every 15 home sales in the second quarter of the year were defined as “flips” by ATTOM Data Solutions. A flip is any arms-length transaction that occurred in the quarter where a previous arms-length transaction on the same property had occurred within the last 12 months. ATTOM’s second quarter report on flipping says 53,621 single-family homes and condos were flipped in the second quarter, 6.7 percent of total transactions. This is down slightly from 7.5 percent or one of every 13 transactions in the first quarter, but up from 6.1 percent or one in 17 in the second quarter of last year. While flipping declined slightly last quarter, both profits and profit margins were up . The median sales price of second quarter flips was $232,402 and the median paid by the investor was $164,500…(read more)

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Source: Mortgage News Daily

Forbearance Plan Count Continues to Shrink

Posted To: MND NewsWire

There was a fourth straight decline in the number of mortgage loans in forbearance during the week ended September 15. Black Knight says the total dropped by 26,000 or 0.7 percent to an estimated 3.7 million loans. That is down 22 percent from the peak of over 4.7 million in late May. Volumes have declined in 10 of the last 12 weeks. The remaining forborne loans represent 7 percent of all active mortgages and $781 billion in unpaid principal. Black Knight says there are 1.7 million plans set to expire in September so there could be significant numbers of plan extensions as well as plans ending over the next few weeks. The week’s decline was primarily driven by GSE loans , with active forbearance plans dropping by 28,000 (-2 percent). There are now 1.361 million Fannie Mae and Freddie Mac loans…(read more)

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Source: Mortgage News Daily

Refis Increased Slightly in August, FICO Scores Highest This Year

Posted To: MND NewsWire

The refinance share of loans originated in August rebounded slightly from July levels as interest rates fell to the lowest in Ellie Mae’s history. The company’s Origination Insight Report says the average rate on all loans fell to 3.09 percent during the month, down from 3.24 percent in July. The 30-year note rate VA loans fell below 3 percent to 2.86 percent from 3.02 percent in July. The 30-year note rate on conventional loans dropped to 3.12 percent from 3.26 percent in July. Similarly, the 30-year rate on FHA loans fell from 3.26 percent to 3.10 percent. As a result of these rates, the refinance share grew to 56 percent of all loans, up from 54 percent in July. The purchase mortgages share dipped to 44 percent from 46 percent. “Interest rates are at historic lows, driving volume across…(read more)

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Source: Mortgage News Daily

MBS Day Ahead: Running Out of Ways to Say "Sideways"

Posted To: MBS Commentary

Tossed coconut salad… Fresh coconut milk… New England boiled coconut… There were only so many menu choices for Yosemite Sam working with one ingredient. We're in a somewhat similar position over the past month with nothing to observe apart from a range-bound bond market. But whereas coconuts might make someone crazy eventually, who's going to complain about an incredibly narrow trading range just above all-time low bond yields? The only thing to complain about in this situation is simply the uncertainty regarding the next big move. Are rates going to break higher or lower? And when will that happen? For the foreseeable future, we can make strong cases that argue against a big break in either direction. Bonds would have a tough time plummeting to new all-time low yields considering…(read more)

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Source: Mortgage News Daily

eClosing, Compliance, IRRRL Products; Plethora of Disaster Policy News; Rates Hardly Budging

Posted To: Pipeline Press

Before the pandemic I used to spin that toilet paper roll like I was on Wheel of Fortune. In March and April I turned it like I was cracking a safe. Now things are back to normal, and the toilet paper area at Costco isn’t the Mecca it became six months ago. Economies have a way of correcting back to normal supply and demand functions. Whale oil was largely replaced by the cost and abundance of petroleum in the 1860s (although it was used in cars in the U.S. as a constituent of automatic transmission fluid until it was banned by 1973). I mention this because softwood lumber prices increased nearly 15% in August , driving the price paid for goods used in residential construction up 0.9% during the month. Housing has been a bright spot for the overall economy in recent months, with U.S….(read more)

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Source: Mortgage News Daily