Weekly Recap (05/16/11-05/21/11)by Tim Manni
We get that question a lot! While sometimes it’s hard to understand why a certain reader was denied a refinance based on just the information they left in a blog comment or an email, other times, the reason is rather black and white.
While I may be able to discern why a given homeowner doesn’t qualify for a refinance, the answers borrowers receive from their servicers are often vague and incomplete. But just knowing whether or not you have mortgage insurance alone could unlock the key to why you have been denied…
It’s always puzzling why more mortgage borrowers don’t fill out loan applications when mortgage rates are historically low and still falling. In this current low-rate environment, there are, however, the usual suspects that keep borrowers on the sidelines:
1. Borrowers want to wait and see how low mortgage rates will actually go before they start rising again.
2. Strict credit conditions prevent a certain pool of borrowers from getting involved…
When will the real estate downturn end? According to a new study by RealtyTrac and Trulia, most Americans surveyed believe that a market which has been in the dumps since April 2007 is likely to remain depressed until 2014. That would mean a seven-year drought on the real estate front, something truly of biblical proportions.
What makes the study interesting is that questions asked in November 2010 were asked again in April 2011. The changing perception of the marketplace is apparent–the hope for a quick resolution of the housing crisis has now evolved into a belief that we will remain firmly stuck in slow gear, despite current mortgage rates which are near historic lows…
Beginning today, until May 27, 2011, the Consumer Financial Protection Bureau is seeking comment from consumers and industry professionals alike on the design of a new, single-page mortgage disclosure form:
Consumers who apply for mortgage loans get two disclosure forms with basic facts about the loan they’ve applied for. You see the disclosure before you sign on the dotted line – it’s what you know before you owe.
We need your help. We’re designing a single, simpler disclosure. From now until Friday, May 27th, you can review our draft designs, and tell us what you like best. It only takes a few minutes, and your input will be delivered to our team.
Click here to provide your feedback.
Could it be that lower home prices are actually good news?
Writing in the Washington Post recently, Robert Samuelson argues that “housing’s troubles may have a silver lining. If you’re a homeowner, the steep fall in prices is calamitous. But if you’re a future buyer, it’s a godsend. What we’re seeing is a massive wealth transfer from today’s older homeowners to tomorrow’s younger homeowners. From year-end 2006 to 2010, housing values fell $6.3 trillion, reports the Federal Reserve. Assuming there’s no sharp rebound in prices–a good bet–that’s $6.3 trillion the young won’t pay”…
Mortgage rates found even more room to fall last week as our economy shows no signs of serious improvement. While mortgage rates have found a new low point for 2011, they seem to have found the mid-way point between some highs and lows over the last eight months or so:
Along with a leveling of gains in equity prices over the past couple of weeks, at least some money has come back into bonds, taking the top off of a spike in mortgage rates which saw the conforming 30-year fixed-rate mortgage run from 4.32% on October 22, 2010 to as high as 5.09% on February 18 of this year. This week’s average of 4.74% for that most common instrument is almost exactly halfway between those two bookends…