6/20/10 – 6/26/10: Our Week In Reviewby Tim Manni
According to the latest reports out this week, while the government has been slow to convict tax credit fraudsters, they’ve apparently been quite swift in granting existing prisoners — even many who are serving life sentences — $8,000 each for the homebuyer tax credit!
Update1: At the close of business today, the 30-year Conforming fixed rate rang in at 4.69%.
Original post: At the close of business yesterday, the 30-year Conforming fixed rate rang in at 4.75%, according to HSH.com. That’s a 54-year low for mortgage rates (from what we can reckon), the lowest we’ve ever recorded.
A while back one of our dedicated readers told me she couldn’t understand why the mortgage industry wasn’t doing more to persuade borrowers from strategically defaulting (when a borrowers who can afford their monthly payments defaults on purpose). As of yesterday, the biggest player in the American mortgage market took action.
Earlier this week the Home Affordable Modification Program (HAMP) received yet another black mark on its increasingly-poor record. Reports now say that more borrowers have dropped out of HAMP than have graduated to “permanent” successful loan mods. According to our friend Alan Zibel at the Associated Press (AP), 155,000 borrowers dropped out of HAMP in May alone; 436,000 borrowers have dropped out since the program began.
Update1: May’s new-home sales report added to the concerns of industry insiders and experts alike in a major way. The record-setting drop of almost 33% last month was, like the existing-sales report (see below), a surprise to some analysts. While the overall opinion was that sales were going to falloff after the tax credit was through, the abrupt and massive nature of the decline was the bigger shock.
Fannie Mae and Freddie Mac recently announced some mortgage relief for homeowners impacted by the BP oil spill. According to financial expert Peter Miller, the relief is in line with other typical mortgage forbearance granted during natural disasters.
Today is the official start of summer, a season typical of “languid times for real estate and housing markets.”
Last week, the extension of the Homebuyer Tax Credit’s closing deadline was the big news here on the blog (be sure to vote on our new poll if you haven’t already). Congress’ decision to extend the period of time in which borrowers can close on their home loans and still take advantage of up to an $8,000 credit, is likely to be the last government interaction in this targeted support for buyers (and sellers) that has increased, yet distorted, demand.