Retail, Correspondent Jobs; Performance, Non-QM, Sales Tools; STRATMOR Strategy Paper; DACA and FHA

Posted To: Pipeline Press

“Do y’all remember, before the internet, that people thought the cause of stupidity was the lack of access to information? Yeah, it wasn’t that.” The internet has brought a lot of change to the world, and to our industry. But we don’t need the internet to drive changes, and potential changes, in our biz. HUD has declared that it will once again back DACA mortgages. Huntington’s Rob B. asks, “Is a CRA Mandate coming for independent mortgage banks (IMBs)?” (Prompting his question is the perception that President Biden will look for opportunities to boost homebuyers and builders . Of course, if there is little inventory, or land to build on, or people to build them…) CFPB Director Kathy Kraninger, who’s term would not have ended until 2023…(read more)

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Source: Mortgage News Daily

Construction Surges to Highest Levels in 15 Years

Posted To: MND NewsWire

Residential construction finished out 2020 much more strongly than analysts had expected. The U.S. Census Bureau and Department of Housing and Urban Development reported significant increases in both residential permitting and housing starts in December , the second month in a row those numbers have grown. The numbers, however, took a hit in the Northeast. Permits for privately funded construction were issued at a seasonally adjusted annual rate of 1,709,000 units, an increase of 4.5 percent from the revised (from 1,639,000 units) rate of 1,635,000 in November. The pace of permitting in December was 17.3 percent higher than the 1,437,000 units estimated a year earlier. Econoday and Trading Economics had reported low expectations for December permits on the part of their analysts. The consensus…(read more)

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Source: Mortgage News Daily

MBS Day Ahead: Defensive Shift is a Cause For Concern; Yields Struggling With an Important Floor

Posted To: MBS Commentary

The GA senate election shift is old news. It did the damage it was always likely to do, but bonds had a good show of support by the end of the following week. That made good enough sense considering the pandemic is driving the market and the pandemic can't be quickly defeated. But it's worth noting that the pandemic is also driving central bank policy, and when those policies are tweaked–even subtly–bonds can and will reac t. This morning's change to the ECB's PEPP is the latest example. If you didn't click the link above, the nutshell version is this: the European Central Bank made a subtle change to its pandemic relief bond buying program that COULD mean it will buy slightly less than the maximum amounts. When these programs are initially announced, markets account for…(read more)

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Source: Mortgage News Daily

Mortgage Rates Making Steady Progress Over The Past Week

Posted To: Mortgage Rate Watch

Mortgage rates are off to a decent start this week with the average lender offering slightly better terms compared to last Friday. The progress actually began earlier last week. On Tuesday morning, rates were at their highest levels in exactly 2 months after jumping at a relatively quick pace in response to the Georgia senate election. The underlying bond market was making an adjustment for a likely increase in Treasury issuance in the short term. There was no way to be sure how long that adjustment would last or how much it would impact rates. That uncertainty began to clear up on Tuesday as a scheduled auction of US Treasury debt was met with strong demand. After that, the tone in the bond market shifted for the better and we’ve seen additional examples of resilience. In general, when bonds…(read more)

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Source: Mortgage News Daily

DACA "Dreamers" Given FHA Loan Eligibility

Posted To: MND NewsWire

The Department of Housing and Urban Development (HUD) announced on Tuesday that it has extended eligibility for FHA mortgages to individuals who are classified under the Deferred Action for Childhood Arrivals program (DACA). These individuals are perhaps better known as “Dreamers.” DACA status is granted to undocumented individuals who were brought into the country before their 16 th birthday and were under the age of 31 when the category was established in June 15, 2012. Residency requirements apply and individuals must be in school, have completed high school, obtained a GED certificate, or be honorably discharged from one of the military services. DACA status allows its holders to work legally in the U.S. and prevents their involuntary removal from the country for a two-year renewable term…(read more)

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Source: Mortgage News Daily

Rising Material Prices and Lot Shortages Hurt January Builder Confidence

Posted To: MND NewsWire

After setting three successive record highs, most recently a 90 level in November , the pandemic and rising construction costs are taking a toll on the Housing Market Index (HMI). The National Association of Home Builders (NAHB) said the index, which it sponsors with Wells Fargo, fell for the second straight month. A 3-point drop in the index, which measures builder confidence in the new home market, follows a 4-point decline in December. The January level now stands at 83. “Despite robust housing demand and low mortgage rates, buyers are facing a dearth of new homes on the market, which is exacerbating affordability problems,” said NAHB Chairman Chuck Fowke. “Builders are grappling with supply-side constraints related to lumber and other material costs, a lack of affordable lots and labor…(read more)

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Source: Mortgage News Daily

MBS Day Ahead: Does Inauguration Day Matter For The Bond Market?

Posted To: MBS Commentary

Does inauguration day matter for the bond market? Not as such, no. To be sure, the changing of the guard in D.C. is indeed a big deal for the bond market, but only because the senate flipped to democratic control as well. The inauguration is just ceremony marking a transition that's already priced into the bond market. What about another incident like the storming of the capitol last week? If that incident was any indication, bonds won't be too interested in that sort of drama unless it's far worse or actually has a lasting, disruptive effect on the government. Bottom line: it's a day to get through before the bigger market movers arrive. Traders are far more interested in seeing the details of the next iteration of stimulus and whether or not it can pass the Senate. As for…(read more)

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Source: Mortgage News Daily

Ops, AE Jobs; Sales, Leadership, Tech, Pricing Tools; VA, Ginnie, FHA Changes Incl. URLA Update

Posted To: Pipeline Press

In his Saturday Morning Cup of Joe , Jeremy Potter quipped, “The word ‘homeowners’ has the word ‘meow’ in it. Good luck unseeing that from now on.” Plenty of people are out there predicting the path of homeowners and homeownership. And there are those that say, “All forecasts are wrong, but some are useful.” It has certainly been interesting hearing forecasts about the direction of rates (relatively steady with a bias toward increasing gradually), new regulations for lenders (relatively steady with a bias toward increasing gradually), and even residential lending IPOs. (The current STRATMOR blog is, “Lenders and Vendors Going Public: Pros and Cons” .) Broker and Lender Services and Products “ DocProbe partners with your Post…(read more)

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Source: Mortgage News Daily

New Home Purchase Applications Remained Strong to Year's End

Posted To: MND NewsWire

The Mortgage Bankers Association (MBA) estimates that applications for the purchase of newly built homes rose only 0.2 percent from November to December, however, those applications were up 42.2 percent compared to December 2019. The information comes from MBA’s monthly Builder Application Survey (BAS) and was not adjusted for typical seasonal patterns. Based on those mortgage applications and assumptions regarding market coverage and other factors, MBA estimates new single-family home sales were running at a seasonally adjusted annual rate of 876,000 units in December 2020. This is an increase of 5.9 percent from the November pace of 827,000 units. On an unadjusted basis, there were an estimated 59,000 new home sold during the month, unchanged from the same level in November. “The new home…(read more)

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Source: Mortgage News Daily

Fannie/Freddie Allowed to Keep More Capital (Again)

Posted To: MND NewsWire

Late last week the Federal Housing Finance Agency (FHFA) and the U.S. Department of the Treasury (Treasury) agreed to amend the Preferred Stock Purchase Agreements (PSPAs) which govern the required distribution of dividends to Treasury from the government sponsored enterprises (GSEs) Fannie Mae and Freddie Mac. The amendments will bring the amount of capital the companies are permitted to retain into conformance with the 2020 Enterprise Capital Rule unveiled by FHFA in November. Under that rule, the GSEs will be allowed to retain earnings to maintain tier 1 capital in excess of 4.0 percent of their guarantee obligations to avoid restrictions on capital distributions and discretionary bonuses. The PSPAs were written when the GSEs were placed in conservatorship in 2008. In return for financial…(read more)

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Source: Mortgage News Daily