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  1. RealtyTrac: Foreclosures Decline Substantially in April

    By on May 17, 2012

    Declines concentrated in the West, 11 of 20 Metros See Increases

    According to RealtyTrac, foreclosures fell broadly in April. Foreclosure filings (which includes default notices, scheduled auctions, and repossessions) were issued for almost 189,000 homes in April, the lowest since July 2007.  This represents 5 percent decline from March and a 14 percent dip from April 2011.  Said Brandon Moore, CEO of RealtyTrac:

     “Rising foreclosure activity in many state and local markets in April was masked at the national level by sizable decreases in hard-hit foreclosure states like California, Arizona and Nevada.  Those three states, and several other non-judicial foreclosure states like them, more efficiently processed foreclosures last year, resulting in fewer catch-up foreclosures this year.

    In addition, more distressed loans are being diverted into short sales rather than becoming completed foreclosures.  Our preliminary first quarter sales data shows that pre-foreclosure sales — typically short sales — are on pace to outnumber sales of bank-owned properties during the quarter in California, Arizona and 10 other states.”

    The increased acceptance of short sales is definitely a positive development, as they are less harmful to all involved parties (borrower, lender, and community) than are foreclosures.  I’m still not convinced that the housing market is out of the woods by any stretch of the imagination.  The mortgage settlement should clear the way for banks to proceed with more foreclosures, especially in judicial foreclosure states.  Despite the overall decrease, foreclosures rose (on an annual basis) in 11 of the 20 largest U.S. metro regions.  Foreclosure activity was generally down in the West, but up in the rest of the country.

    For a while I’ve been saying that another large wave of foreclosures is coming.  That is looking less likely, especially if the trend toward short sales continues.  I still think that we are going to see an increase in foreclosures in the coming months, but I don’t think it will be as large as I initially thought.

     

    Category: Mortgage Rates

  2. 30-Year Rate Hits Record Low For Third Straight Week

    By on May 17, 2012

    At what point do record low mortgage rates become boring?  I would argue we got there a few months ago.  Anyway, Freddie Mac’s Primary Mortgage Market Survey showed the 30-year fixed rate mortgage hitting a new all-time low at an average of 3.79%.  Freddie’s Chief Economist Frank Nothaft remarked:

    “The European debt crisis overshadowed improving economic indicators for the U.S. and allowed Treasury bond yields and fixed mortgage rates to ease for another week.  For instance, industrial production rose 1.1 percent in April — the largest gain since December 2010 — and consumer sentiment in May rose to its highest reading since January 2008, according to the University of Michigan.”

    Rates have been at or near record lows for most of the year, and I don’t anticipate a change in the near future.  U.S. economic data is mixed at best, and may be weakening.  Europe is a disaster, and the Fed is making some noise about additional monetary accommodation being necessary if conditions deteriorate.

    Category: Mortgage Rates

  3. Mortgage Rates: Nudge Me if You Hear Me Snore

    By on May 17, 2012

    Mortgage rates are heading absolutely nowhere after early trading in mortgage-backed securities this morning.  The weekly jobless claims report continued its snooze inducing run of numbers that has persisted over the last 90 days or so.  Manufacturing data from the Philadelphia Federal Reserve Bank region was weak as was as was the leading indicators report.  Nevertheless with no change in the US job market and Europe still in a very chaotic state, mortgage rates are likely staying at current levels.

    The weekly jobless claims report indicated that 370,000 people filed first-time claims for unemployment insurance.  That number was equal to the revised report for last week and consistent with a very narrow range that extends back to the beginning of February.  The good news for the US economy in this is that he jobs picture is not getting worse—the bad news naturally is that it is not making any progress either.  Overall for mortgage rates the stagnation in the jobs picture is helpful—it supports the current low rates.

    The Philly Fed Index came in surprisingly weak today.  Analysts had expected positive movement in the index yet the movement was decidedly negative.  Leading economic indicators also declined unexpectedly this month.  These two reports have been very unpredictable over the past six months.

    The biggest news from Europe this morning is that the European Central bank has cut-off liquidity funding with four Greek Banks.  This move essentially forces the Greek Central Bank to provide the liquidity that they promised to in the bailout deal that was agreed to by all Euro Zone countries.  Greece has been slow to implement the reforms and commit the funds necessary to support their banks.

    With no fresh economic data of any significance tomorrow or next week, mortgage rates could be even more susceptible to news from Europe.

    Category: Compare Mortgage Rates, Current Mortgage Rates, Mortgage Interest Rates, Mortgage Rate Trends and Analysis, Mortgage Rates, Purchase, Refinance

  4. Current Mortgage Rates for Wednesday, May 16, 2012

    By on May 16, 2012

    We are seeing mortgage rates rise this morning as positive U.S. economic data at least temporarily outweighs the approaching U.S. “fiscal cliff” as well as continued bad news from Europe, and Greece in particular.

    There were two positive pieces of U.S. economic data this morning.  Housing Starts rose significantly in April, jumping from 699,000 to 717,000 (seasonally adjusted).  The March figured was adjusted upward from a pace of 654,000.  This is significantly above expectations.  The second piece of data was the Industrial Production report from the Federal Reserve.  They saw production increase 1.1 percent in April.  Again, this is above expectations of 0.7 percent.  These numbers will cause you to hear from the bulls this morning, but I remain very unconvinced of the strength of this jobless recovery.  Still, stocks are rallying right now, while Treasuries and mortgage backed securities are selling off on perceived strength.

    In Europe we are seeing borrowing rates for peripheral Eurozone states rise this morning (Greece, Spain, and Italy in particular).  The Greeks failed to create a new government yesterday, which means there will be another round of elections in that country, most likely in June.  To make matters even worse, Greek citizens pulled about $900 million out of banks yesterday in fears that Greece could withdraw from the Eurozone in the near future. I have no idea what will happen if this turns into a full-blown bank run/panic, but it almost certainly won’t be good for anybody.

    So on balance, I anticipate that the data from the U.S. will push rates somewhat higher today, although I do not think there will be a huge spike.  Tomorrow we have Jobless Claims and the Philadelphia Fed Survey.  We shall see how that goes.

    Total Mortgage is committed to getting you the lowest possible rate.  To get information on our rates and products, call us today at 877-868-2503, or fill out the form to the right.

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    Category: Mortgage Rates

  5. US Industrial Production Spikes But Mortgage Rates Hold

    By on May 16, 2012

    US Industrial Production Spikes But Mortgage Rates Hold

    US Industrial Production spiked by twice the expected amount in April.  Analysts had forecasted an increase of .5%.  The April reading was the biggest month over month increase in over a year.  Analysts do believe this month’s result is a catch-up for last month’s disappointing results.  What is the impact of this positive economic news for mortgage rates?

    Mortgage rates would typically respond negatively to a result such as this but appear to be holding tight at current levels.  Despite other positive economic news in the US today as well, on-going uncertainty in Greece is cancelling out the effect of the good news.

    Category: Compare Mortgage Rates, Current Mortgage Rates, Mortgage Interest Rates, Mortgage Rate Trends and Analysis, Mortgage Rates, Purchase, Refinance

  6. Diversion of Mortgage Settlement Money Continues

    By on May 16, 2012

    I discussed this topic a little bit yesterday, but in light of a New York Times article by Shaila Dewan this morning, I think it is worth further delving into the diverting of mortgage settlement funds to make up state budgetary shortfalls.  From the Times:

    “Hundreds of millions of dollars meant to provide a little relief to the nation’s struggling homeowners is being diverted to plug state budget gaps. 

    In a budget proposed this week, California joined more than a dozen states that want to help close gaping shortfalls using money paid by the nation’s biggest banks and earmarked for foreclosure prevention, investigations of financial fraud and blunting the ill effects of the housing crisis. California was awarded more than $400 million from the banks, and Gov. Jerry Brown has proposed using the bulk of that sum to pay the state’s debts.

    The money was part of a national settlement valued at $25 billion and negotiated with five big banks over abuses in their mortgage and foreclosure processes.”

    I have made no secret of the fact that I believe that the mortgage settlement is completely and utterly inadequate.  It basically amounts to a slap on the wrist for what is likely one of the largest frauds ever perpetrated.  It is hard to believe that this deal could get worse, but it is, because a lot of the $2.5 billion in cash that was to be distributed to the states for the purpose of aiding homeowners is being used for other purposes (for instance, prison-building in Arizona).  The total settlement is for $25 billion, but the vast majority of that is supposed to come in the form of write-downs and modifications.  As the Times article notes, “even that relatively small amount has proved too great a temptation for lawmakers.”

    Dave Dayen, who does excellent work over at Firedoglake.com, is keeping a running total of diverted funds.  So far it is up to $234 million, and that number appears to be rising.  This settlement was unconscionable, the diversion of settlement funds adds insult to injury.

    Category: Mortgage Rates

  7. Mortgage Rates Feel Pressure of Good Data

    By on May 16, 2012

    Mortgage rates are pressured today after better than expected data on the US economy was released.  Not only was the data better than expected—it was significantly better. But while good news tends to be a negative for mortgage rates—today’s news may only push rates slightly higher given the on-going uncertainty in Europe.

    At 8:30 AM this morning housing starts and permits data for April were released.  Analysts had been expecting 680 thousand housing units to be started in April but the actual total was 717 thousand units—a healthy difference.  While housing starts did surpass their estimates new permits for housing units declined by 7%.  Analysts were impressed with the starts data but explained that we are still “normalizing” after the warmer than expected winter.

    Also beating expectations significantly this morning was the Industrial Production report.  Forecasts called for an increase in industrial activity by .5%.  The 1.1% was more than twice the expectation and the highest level reported in over a year.  The report indicated that utilities and manufacturing firms picked up their activity significantly in April.

    This afternoon at 2:00 PM the minutes of the past Federal Reserve Open Market Committee meeting will be released.  Analysts will be looking for any sign that the committee is either more or less open to future stimulus.  Most “Fed Watchers” believe that the committee is split between those that are open to more stimulus and those that are strongly set against it.  For now it appears the opponents of new stimulus have the upper hand.

    German Chancellor Angela Merkel ‘s comments today that she wants to find a way to keep Greece in the Euro Zone has helped calm the markets in Europe and the US.  A Greek default and exit from the Euro Zone would cause major disruptions to world markets.  Despite the German leader’s comments many analysts believe that Greece’s exit from the monetary union is a foregone conclusion.

    Tomorrow jobless claims, the Philly Fed Index (manufacturing) and Leading Indicators report will compete with news from Europe to propel mortgage rates.

    Category: Compare Mortgage Rates, Current Mortgage Rates, Mortgage Interest Rates, Mortgage Rate Trends and Analysis, Mortgage Rates, Purchase, Refinance

  8. Current Mortgage Rates for Monday, May 15, 2012

    By on May 15, 2012

    Yesterday saw mortgage rates improve slightly.  I expect that they will remain close to current levels today.

    There were a couple of economic numbers released this morning.  None of them especially remarkable.  Retail sales increased by 0.1% from March to April, more or less in line with expectations.  This is the slowest pace of growth this year.  The Consumer Price Index was unchanged in April, while core CPI (which excludes food and energy, which tend to be volatile) rose 0.2%.  This is also essentially in line with expectations.  So we are not seeing significant inflation, and economic growth is stagnant.  Neither of these numbers will really push the markets one way or the other, especially in light of the ongoing troubles in Europe.

    Uncertainty surrounds the situation in Greece, where the newly elected president was unable to form a government.  This will cause a new set of elections, probably sometime in the middle of June. It looks increasingly certain that Greece will have to leave the Eurozone, although it is not clear exactly how this will happen.  The ultimate impact of all of this on the global economy is unclear, but suffice it to say that the fear of some sort of disaster scenario will help keep mortgage rates low for the near future.

    Total Mortgage is committed to getting you the lowest possible rate.  To get information on our rates and products, call us today at 877-868-2503, or fill out the form to the right.

    Continue Reading…

    Category: Mortgage Rates

  9. Retail Sales Downward Trend to Pull Down Mortgage Rates?

    By on May 15, 2012

    Retail Sales Improve but Three Month Trend is Down

    US retail sales have continued there streak of positive growth in April of 2012.  However, for the third consecutive month overall sales growth has declined. Two bright spots in the report this month were the increase in sales by online (non-store) retailers which grew by 11% and building material and garden equipment retailers which grew by 10.3%.  Will the declining trend in retail sales help keep mortgage rates near all-time lows?

    Retail sales are the lifeblood of the US economy.  70% of US GDP is related to retail activity.  If the trend lower for retail sales continues it would have a tremendously negative affect on the overall health of the economy.  This could draw investors into mortgage-backed securities and could induce the Federal Reserve to provide additional stimulus–both of which could bring mortgage rates even lower.

    Category: Compare Mortgage Rates, Current Mortgage Rates, Mortgage Interest Rates, Mortgage Rate Trends and Analysis, Mortgage Rates, Stimulus

  10. Arizona To Divert Mortgage Settlement Funds to Make Up Budget Shortfall

    By on May 15, 2012

    Remember the mortgage settlement that was supposed to provide relief to those wrongfully foreclosed upon?  The settlement itself was borderline embarrassing, in that it amounted to a slap on the wrist for egregious behavior.  What’s worse is that some states with budget shortfalls are trying to divert those funds to make up the budgetary gap.  The fight over the funds could give rise to a lawsuit in Arizona.  According to  Mary Jo Pitzl at the Arizona Republic:

    “[Arizona Attorney General Tom] Horne on Tuesday promptly rebuffed the request from the Arizona Center for Law in the Public Interest. This sets the stage for a legal battle over one of the more controversial provisions of the recently enacted state budget.

    At issue is the decision of the Legislature and Gov. Jan Brewer to tap $50 million from the $97.7 million the state received as part of its settlement with five mortgage-lending firms. They said they needed the money from the national mortgage settlement to balance the state budget. Initially, the intent was to use the money for prison construction.”

    The money was intended to provide counseling and assistance to troubled homeowners.  Dave Dayen at Firedoglake.com is keeping a running total of diverted funds across all states.  So far we are up to $234 million in diverted funds, out of a total of $2.75 billion in cash disbursements.  Dayen doesn’t think that the Arizona Center for Law has much chance of winning this court battle, as nothing in the settlement prevents the mortgage settlement funds from being diverted for other use.

    So, the mortgage settlement just continues to get worse.  California

    Category: Mortgage Rates

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