Freddie: Housing Market Stuck in a Rut...Robert De La Rosa An Expert In Your Court 909.271.5640 CALL NOW!!!!

DAILY REAL ESTATE NEWS | THURSDAY, SEPTEMBER 25, 2014

The housing market is struggling to maintain momentum as housing prices moderate and mortgage applications fall, Freddie Mac reports in its latest Multi-Indicator Market Index.

In July, Freddie's MiMi indicator showed that 8 of the 50 states and 11 of the 50 metros surveyed were on an improving three-month trend. That marks a stark difference from last year at the same time period, when every state, plus the District of Columbia, and every metro was on the improving trend, Freddie Mac reports.

Other Housing Indicators

• Consumers Aren't Losing Confidence in Home Prices
• Housing Market Shows Mixed Picture
• 3 Challenges Still Facing the Housing Market

"We will continue to see 'two-steps-forward-and-one-step-backward' movement in our housing stability index until the broader economy sees better growth, labor markets tighten further, and household formations pick up to bring more first-time and move-up buyers into the market," says Frank Nothaft, Freddie Mac's chief economist. "The good news is, overall, the housing market continues to improve and is up 5 percent on a yearly basis in the latest MiMi reading."

Thirteen of the 50 states, plus the District of Columbia, have MiMi values in the stable range. The top five are: North Dakota; District of Columbia; Wyoming; Montana; and Alaska.

Overall, the MiMi posted a slight decline in the latest month, at 73.4, which indicates a weak housing market. The all-time high for the MiMi was 121.9 in June 2008; the lowest point (when the housing market was considered at its weakest) was in September 2011, when the MiMi fell to 59.8. Since 2011, the housing market has made a 22.7 percent rebound, Freddie Mac reports.

The MiMi monitors and measures the stability of the nation's housing market at the state and metro level by evaluating the current versus long-term stable range of home purchase applications, payment-to-income ratios, on-time mortgage payments, and employment for each area.

"We didn't notice a large decline in any one market this month, but more of softening across the board," says Len Kiefer, Freddie Mac's deputy chief economist. "But the real drag on the most markets' housing recovery continues to be the lack of purchase application activity. Even the hot housing markets in the Northwest, which are back in their stable range of housing activity, are seeing their purchase application activity slow. The one area where momentum hasn't slowed is among the hardest-hit markets. Places like Las Vegas, Miami, Chicago, and Riverside, Calif., among others, are still showing double-digit yearly improvements, but that's largely a reflection of significant gains in the local employment picture as well as a real improvement in borrowers making timely mortgage payments."

Most Improving States

The states showing the most improvement year-over-year, according to the index, are:

• Nevada
• Illinois
• Florida
• California
• South Carolina

Source: Freddie Mac

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Robert De La Rosa

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9220 Haven Ave. Suite 100

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Lending Giants Shy Away From FHA Loans...Robert De La Rosa An Expert In Your Court 909.271.5640 CALL NOW!!!!

Lending Giants Shy Away From FHA Loans

DAILY REAL ESTATE NEWS | MONDAY, SEPTEMBER 22, 2014

The nation’s largest home lenders are curtailing their involvement in Federal Housing Administration loans, known for their small down payment requirements and help to first-time buyers and lower-income Americans. Lenders say they are concerned that they will be penalized if underwriting errors occur and the loans default. Therefore, they’re backing away from issuing the loans.

FHA loans have plummeted 19 percent in the nine months ending June 30 compared to a year earlier. Wells Fargo, the nation’s largest home lender, saw FHA originations drop 82 percent in the first six months of this year compared to the same time period in 2013, according to Inside Mortgage Finance data. Bank of America saw a 72 percent drop in that time, followed by JPMorgan with a 55 percent drop.

Another FHA lending hurdle?Rising FHA Costs Sideline Potential Buyers

In a earnings call with investors in July, JPMorgan CEO Jamie Dimon said: “The real question to me is, should we be in the FHA business at all? And we’re still struggling with that.”

Lenders’ attitudes toward FHA loans have turned sour after facing steep settlements recently from the Department of Justice and federal regulators. JPMorgan Chase & Co., Bank of America Corp., and others have already paid more than $3 billion in fines for originating faulty FHA loans during the housing bubble.

“A big issue is the DOJ settlements and their impact on the lending attitudes of the banks, which is clearly the elephant in the room,” says Brian Chappelle, a former FHA official and partner at Potomac Partners LLC, a consulting firm for lenders in Washington. “The government is worried about access to credit. They’re looking at volume numbers and they know it’s a serious problem.”

HUD and Treasury officials recently met with bank executives at the White House to talk about improving FHA processes. Julian Castro, secretary of the Department of Housing and Urban Development, which oversees FHA, says the agency does seek to ease credit by rewriting clearly when lenders will be forced to pay the cost from loans that go bad.

“With all our efforts, I want to send a simple message to lenders: Let’s work together,” Castro said in a prepared statement at the Bipartisan Policy Center Housing Summit on Sept. 16. “Many have been reluctant to lend because they fear unanticipated consequences. They need to be able to manage their risk better—and so does FHA.”

Anthony Hsieh, CEO of LoanDepot.com, the third largest FHA lender, urges government regulators to do something fast. “Access to credit is tightening across the board and the number of people who can get a home is shrinking to the point of code red,” Hsieh says.

Source: “FHA Loans Plunge 19% as Lenders Haggle with Officials,” Bloomberg (Sept. 19, 2014)

"Get Qualified Now By A Loan Professional" 

Robert De La Rosa

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www.TheCaliforniaPropertyConnection.net

9220 Haven Ave. Suite 100

Rancho Cucamonga Ca, 91730

BRE 01435824

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Robert De La Rosa

An Expert In Your Court

 909.271.5640 CALL NOW!!!!

www.TheCaliforniaPropertyConnection.net

9220 Haven Ave. Suite 100

Rancho Cucamonga Ca, 91730

BRE 01435824

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An Expert In Your Court

 909.271.5640 CALL NOW!!!!

www.TheCaliforniaPropertyConnection.net

9220 Haven Ave. Suite 100

Rancho Cucamonga Ca, 91730

BRE 01435824

Shared Listing

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Standard sale north of the 210 freeway spacious 4 bedroom, 3 bath, 2 story, 3 car garage includes granite counter tops, recessed lighting, wooded flooring, central air, balcony, fireplace, wash dryer hook ups and association pool in the City of Rancho Cucamonga within walking distance from Chaffey College and also near shopping, dining, and other convenient amenities will not last..

MLS IV14103648

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Robert De La Rosa

An Expert In Your Court

 909.271.5640 CALL NOW!!!!

www.TheCaliforniaPropertyConnection.net

9220 Haven Ave. Suite 100

Rancho Cucamonga Ca, 91730

BRE 01435824

Shared Listing

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Standard sale north of the 210 freeway spacious 4 bedroom, 3 bath, 2 story, 3 car garage includes granite counter tops, recessed lighting, wooded flooring, central air, balcony, fireplace, wash dryer hook ups and association pool in the City of Rancho Cucamonga within walking distance from Chaffey College and also near shopping, dining, and other convenient amenities will not last..

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Robert De La Rosa

An Expert In Your Court

 909.271.5640 CALL NOW!!!!

www.TheCaliforniaPropertyConnection.net

9220 Haven Ave. Suite 100

Rancho Cucamonga Ca, 91730

BRE 01435824

Shared Listing

NAR: FHA's HAWK Program Still Needs Work...

DAILY REAL ESTATE NEWS | TUESDAY, JULY 01, 2014

The National Association of REALTORS® offered support for the Federal Housing Administration’s efforts to reduce mortgage insurance premiums for first-time buyers through a new housing counseling pilot program, but NAR officials say they’re concerned that the program imposes fees that negate the cost savings on premiums.

FHA announced a four-year pilot program in May called Homeowners Armed with Knowledge (or HAWK), which offers discounts on mortgage insurance premiums to first-time home buyers as long as they complete housing counseling and stay current on their loans.

Did you know that FHA and NAR have been partners for 80 years?

But NAR officials expressed concern over the fees that buyers would have to pay to take part in the pre- and post-counseling, which would range from $300 for pre-contract counseling classes, $100 for pre-closing counseling, and $100 for post-closing counseling. NAR says first-time home buyers may be skeptical of having to pay the fees. Plus, “it could take a home buyer two years to offset the cost of counseling with the premium reductions offered under the HAWK program,” NAR officials wrote in a letter to HUD on Monday. 

NAR says the fees to take the counseling could be prohibitive if the housing counseling agency or lender is not able to pay part of the fee to offset the costs.

For home buyers who participate in the HAWK program, they will receive a 50 basis-point reduction in the upfront mortgage insurance premium and a 10 basis-point reduction in the annual premium if they complete housing counseling. If they complete post-closing housing counseling and stay current on their mortgage for at least 18 months after closing, the buyers also will receive an additional 15 basis-point reduction on the annual premium starting in the loan’s 25th month.

On a $180,000 loan, home buyers could see a reduction to their monthly payment by $21 per month or about $9,700 over 30 years, according to HUD’s calculations.

“While any amount helps, many qualified home buyers will still not be able to achieve home ownership,” according to NAR’s letter. Since 2010, mortgage payments have increased $122 per month on a $180,000 FHA-insured loan, mostly attributed to an 80 basis-point rise in the annual premium and a 75 basis-point increase in the upfront premium in the past four years.

“REALTORS® are concerned about FHA’s high annual mortgage insurance premiums and the insurance requirement for the life of the loan,” says NAR President Steve Brown. “FHA fees make up nearly 20 percent of a monthly mortgage payment today and are making it more difficult for qualified buyers to purchase a home. Since FHA is on target to meet and exceed its capital reserve requirements in the next fiscal year, we encourage FHA to support premium reductions across the board.”

Source: National Association of REALTORS®

"Get Qualified Now By A Loan Professional" 

Robert De La Rosa

An Expert In Your Court

 909.271.5640 CALL NOW!!!!

www.TheCaliforniaPropertyConnection.net

9220 Haven Ave. Suite 100

Rancho Cucamonga Ca, 91730

BRE 01435824

Shared Listing