Real Estate Directory

Mortgage Aps Flood Banks

 US banks are getting a surge of mortgage applicationsbecause of dramatically lower interest rates, after record loan defaults and thousands of job cuts have stretched mortgage industry resources to the limit.

Applications for home loans more than doubled in the two weeks after the Federal Reserve said it would buy mortgage bonds to help stabilise the market, prompting mortgage rates to fall by more than three-quarters of a percentage point.

There Giving Mortgage Loans Away for Nuthin!

Freddie Mac says mortgage rates at 37-year low, spurring historic refinancing opportunity  

 Rates on 30-year-fixed mortgages dropped this week to their lowest levels in at least 37 years, as the Federal Reserve pledged to pour money into the mortgage market in an effort to spur the moribund U.S. housing market.   Freddie Mac, the mortgage company, reported Thursday that average rates on 30-year fixed-rate mortgages dropped to 5.19 percent, down from the year's previous low of 5.47 percent, set last week. The rate is the lowest since Freddie Mac's weekly mortgage rate survey began in April 1971.

The return of the low down

Starting June 1, 2008, Fannie Mae will accept up to 97 percent loan-to-value ratios for conventional, conforming mortgages processed through its Desktop Underwriter® (DU®) automated underwriting system, and 95 percent loan-to-value ratios for loans underwritten outside of DU, in all geographic locations in the United States. The new national down payment policy will supersede the policy the company adopted in December 2007 that required higher down payments in markets where home prices are declining.

BK Countrywide and get $19million

Countrywide Financial Corp.'s  has sold to BOFA. So Angelo Mozilo who is considered by many the chief architect of the Housing Crisis, will get $19 million in stock next week as part of the takeover by Bank of America Corp.

"It's perverse for Bank of America to reward the principal architects of the bad business practices that caused this housing crisis," Sen. Charles Schumer.

Mortgaging Semantics

Turns out that those of Islamic faith cannot get a loan. According to their faith they are not allowed to pay interest.  So they could not buy a home.  Now it seems there are banks willing to lend under these circumstances. The way they do it is that they own the home like a lease to own for several years. The bank, not the borrower, buys the house. The borrower makes installment payments to the bank for a period of years, at the end of which he or she gets the title to the house.The market has increased by about 15% in the last couple years as large banks like including Citigroup, HSBC, and Deutsche Bank, have developed programs to serve the special needs of Islamic finance.

Sounds about the same deal to me. Except I wonder if the borrower gets any kind of write off.

Subprime Equals $215 B

Subprime-related losses at global financial institutions have so far totaled as much as $215 billion, with about 55 percent of that coming from the United States, the head of Japan's financial regulator said on Monday.

The estimates from Japan's Financial Services Agency (FSA) come after JPMorgan Chase & Co said in a report late on Friday Wall Street banks are facing a "systemic margin call" that could deplete them of up to $325 billion in capital.

What Caused the Subprime Mess? (Humour)

Jumbo Stimulous for Loans

Jumbo Loans Mean Most of the Help will go to Middle and Upper Income Borrowers.
The economic rescue plan that passed the U.S. Congress on Thursday and awaits President Bush’s signature are middle- to upper-income Americans who can refinance their jumbo home loans at cheaper rates.

The stimulus package temporarily raises the maximum size of mortgages that Fannie Mae and Freddie Mac can purchase and market as securities from $417,000 to as high as $729,750 in expensive parts of the country like New York City and California.

Expert: "Feb will be best month ever for mortgages!"

After a major set of cuts recently by the Fed, the Mortgage Genius thinks this is setting Feb. to be record breaking for the financing industry. 

Vince Farrell, managing director of Scotsman Capital, says "I think that with 30-year fixed mortgage where it is right now, 50% of all conventional mortgages are resetable or refinanceable, and I think that’s a big deal.

"As recently as last summer, rates on 30-year fixed loans were about 6.5 percent, and once the Fed actually settles out at the end of the week, we’ll probably only be in the low fives, which will be a two to three year low," according to Spencer Rascoff, chief financial officer of Zillow.

Tougher Mortgage Laws Help consumers

Seven states have started an Internet-based system to supervise mortgage brokers. It maintains a uniform application for mortgage brokers and a database that regulators can use to keep track of brokers who try to work in another state after being banned elsewhere. Consumers will have access by 2009. The States are:
Idaho, Iowa, Kentucky, Massachusetts, Nebraska, New York, and Rhode Island  42 state agencies — including those in Washington, D.C., and Puerto Rico — have committed to join by the end of 2009.

Rates Go DOWN

The Federal Reserve cut two key interest rates by a quarter-percentage point Tuesday to the lowest level in nearly two years .In a 9-1 vote, Fed Chairman Ben Bernanke and his colleagues cut their target for the federal funds rate, their main economic tool that influences borrowing costs across the economy, to 4.25%. It was the third cut from the Fed in less than three months and brought the rate to the lowest level since January 2006.