How the mortgage process just changed

It just got a little easier to navigate the complicated mortgage process.

New disclosure rules went into effect in the mortgage world Saturday that require lenders to provide home buyers two new forms that clearly detail their loan terms.

"For consumers, it's going to be viewed as an improvement in what can be a somewhat scary and intimidating process in the biggest investment of their life," said David Stevens, CEO of the Mortgage Bankers Association.

The rule, formally known as the TILA-RESPA Integrated Disclosure rule, reduces what used to be four forms from two different government agencies to two forms: the Loan Estimate and Closing Disclosure.

Here's what buyers can expect:

read more: http://money.cnn.com/2015/10/05/real_estate/new-mortgage-disclosure-forms/index.html?iid=ob_homepage_money_pool&iid=obnetwork

Cathedral Development Group Closes on Refinancing of Seniors Property

 The $44 million refinancing of Westward Ho Apartments, a historic building that once was a premier hotel for the city, includes a Federal Housing Administration (FHA) Sec. 221(d)(4) substantial rehabilitation loan, 9% low-income housing tax credits (LIHTCs), and federal historic tax credits.

Multiple federal, state, and local entities were involved in the loan restructuring, including three Department of Housing and Urban Development offices and the city of Phoenix. The FHA loan was provided through Berkadia Commercial Mortgage, and the LIHTC equity was syndicated through The Richman Group and provided by Bank of the West. Arizona Department of Housing allocated the tax credits.

“What’s unique about this refinancing is that it is for a nationally registered historic structure located in the heart of downtown Phoenix within a quarter of a mile from the nearest light-rail station and close to amenities,” said Robert Gaudreau Jr., president of CDG, in a statement. “Additionally, the facility will offer residents health and social services through a unique partnership with Arizona State University who will occupy the first floor of the Tower building on the property.”

The building opened as a hotel in 1928 and underwent an expansion in 1948 to grow to 600 rooms. The hotel was converted to affordable housing in 1979.

The approximately $14 million rehabilitation will include repairs and upgrades to windows, HVAC equipment, and central plant mechanical and plumbing systems, as well as new cabinets, floors, and fixtures in units.

“Select in-unit improvements will enhance the residents’ living experience and improve the desirability and marketability of the property,” said Gaudreau.

read more: http://www.housingfinance.com/finance/cathedral-development-group-closes-on-refinancing-of-seniors-property_o

A risky type of mortgage, back with a twist

Don’t call it a comeback.

Interest-only mortgages got a bad reputation in the aftermath of the housing bust, but they’ve managed to stick around as an option for homebuyers who can meet stricter lending guidelines enacted by the government in recent years.

The loans can lower monthly mortgage payments by letting borrowers put off paying the principal on their loan for several years. When the interest-only period ends, the borrower’s monthly payment spikes as they begin to pay a combination of principal and interest until the loan is paid off.

That monthly payment shock, often accompanied by a higher interest rate on adjustable-rate interest-only loans, is what got many borrowers in trouble a decade ago.

One reason is that many of those borrowers qualified for their loans on the basis of their ability to repay the lower, interest-only payment. When their monthly payment reset higher, many couldn’t keep up.

That’s no longer the case. Now lenders are required to determine whether borrowers qualify for any interest-only loans, or other adjustable-rate mortgages, based on whether they can afford to make the eventual bigger monthly payments that await them once the initial interest-only period ends.

As a result, such interest-only loans now make up only about 0.2 percent of all adjustable-rate mortgages, or ARMs, which account for about 4 percent of all home loans for purchase and refinancing, according to data from CoreLogic.

Use of interest-only mortgages peaked 10 years ago at the height of the housing bubble at around 10 percent of all ARMs.

“The big difference here is interest-only loans are back to being the niche product that they traditionally had been,” said Greg McBride, chief financial analyst at Bankrate.com. “The go-go days of the housing boom were the exception.”

Still, rising home prices can make interest-only loans a tempting option for borrowers who are interested in a lower mortgage payment and can qualify for such a loan under today’s stricter guidelines.

At least one lender is looking to expand access to interest-only loans to a broader range of homebuyers, not just the affluent buyers who typically take advantage of such loans.

In July, United Wholesale Mortgage began making interest-only home loans through its network of mortgage brokers. The loan program covers mortgages as low as $250,000. That’s just above the U.S. median home price of $236,400.

Even with today’s stricter guidelines aimed at ensuring borrowers can handle interest-only loans, they carry potential financial risks. Here are some things to consider when weighing whether such a loan is right for you:

PAYMENT CHANGES

Interest-only mortgages can come with a fixed or variable interest rate and an initial period when the borrower pays only interest on the loan. That’s usually three, five, seven or 10 years. After the interest-only period, the monthly payment can increase sharply as the borrower begins to also pay down the principal.

In addition, the borrower is left with 20 years to pay off the balance of the loan.

LENDING REQUIREMENTS

To ensure borrowers can afford an interest-only mortgage, lenders often require large down payments compared to what one can find with a traditional 30-year, fixed-rate home loan backed by the government.

read more: http://www.watertowndailytimes.com/curr/a-risky-type-of-mortgage-back-with-a-twist-20150906

Average 30-year mortgage rate drops to 3.84% from 3.93%

WASHINGTON (AP) — Average long-term U.S. mortgage rates dropped this week to their lowest levels since May, in a week marked by turmoil in global markets that was stoked by economic developments in China.

Mortgage giant Freddie Mac said Thursday the average rate on a 30-year fixed-rate mortgage fell to 3.84% from 3.93% a week earlier. The benchmark rate hasn’t been that low since May 21.

The rate on 15-year fixed-rate mortgages declined this week to 3.06% from 3.15%.

The panic selling and extreme gyrations in stock markets sent investors to the safety of U.S. government bonds, raising their prices and dampening their rates. Mortgage rates often track the yield on the 10-year Treasury bond, which dipped below 2% on Monday, a day of epic losses and price swings on Wall Street. The yield recovered to 2.18% Wednesday. That compared with 2.22% last Wednesday.

On Monday, a brief 1,000-point plunge in the Dow Jones industrial average just minutes after stocks opened for trading sent shivers from Wall Street to Main Street. The average ended the day down 3.6%. The market staged a robust recovery Wednesday, clocking its best day in nearly four years as the Dow average gained 4%.

The recent economic jitters and stomach-churning markets have thrown into question whether the Federal Reserve will raise a key interest rate next month, as has been long anticipated. A rate hike by the Fed could bring higher rates for home loans. The Fed has kept its key short-term rate near zero since the financial crisis year 2008.

Steady U.S. job growth and low mortgage rates have improved home sales this year. Data issued Thursday by the National Association of Realtors showed that slightly more Americans signed contracts to buy homes in July, as pending sales edged up after dipping in June.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country at the beginning of each week. The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1% of the loan amount.

The average fee for a 30-year mortgage was unchanged from last week at 0.6 point. The fee for a 15-year loan also held steady at 0.6 point.

read more at: http://www.usatoday.com/story/money/personalfinance/2015/08/27/mortgage-rates/32477661/

Double-Edged Sword for Mortgages as Market Fears Drive Rates Down

The recent global market turmoil could be good news for banks and mortgage lenders if a further drop in long-term interest rates sparks another wave of refinancing.

It also could spell trouble for lenders that have not properly hedged the value of their servicing rights, however, and the benefits of lower rates are far from assured.

U.S. Treasury yields, which mortgage rates are tied to, slumped to a four-month low Monday, as investors remained anxious about China's woes and the slower pace of global growth and sought a safe haven in government bonds. The 10-year Treasury yield fell as low as 1.95% during the session, down six basis points from late Friday.

For now, mortgage rates would have to drop at least 25 basis points or more from recent levels to spark a major wave of refinancings.

"A big chunk of 2013 and 2014 loans are just out of the money to refinance," said Scott Buchta, head of fixed income strategy at Brean Capital.

The stock market plunge has some investors assuming that the U.S. economy is heading into a recession, with the potential for massive layoffs at manufacturing firms that could be crippled by lower commodity prices.

Ivy Zelman, the CEO of Zelman and Associates, a housing analytics firm, said the sell-off hitting homebuilders, mortgage insurers, title companies and financial stocks, is an overreaction. With yields on 10-year Treasury notes falling to 2%, the market is assuming much slower economic growth ahead, she said.

"It's more about slowing economic growth than about rates," Zelman said. "There's a lot of knee-jerk reactions."

The biggest concern is that manufacturers would start laying off employees, resulting in job losses.

"If people lose their jobs, they can't buy a house," Zelman said.

Uncertainty about whether the Federal Reserve will raise short-term rates in September or delay a rate hike until December or early next year has contributed to the market volatility.

Some nonbank mortgage servicers will be aggressive at soliciting borrowers to refinance. Since most banks and mortgage lenders are seeing a steady flow of home purchase and refinance volume, they may be loath to lower mortgage rates much further, since doing so would cut into profits.

read more: http://www.nationalmortgagenews.com/news/origination/double-edged-sword-for-mortgages-as-market-fears-drive-rates-down-1059696-1.html

MBA: Mortgage Delinquencies, Foreclosures Continued To Fall In Q2

The delinquency rate for mortgage loans on one-to-four-unit residential properties decreased to a seasonally adjusted rate of 5.30% of all loans outstanding at the end of the second quarter - down 24 basis points from the first quarter and down 74 basis points from the second quarter of 2014, according to the Mortgage Bankers Association's (MBA) National Delinquency Survey.

It was the lowest delinquency rate since the second quarter of 2007.

Meanwhile, about 2.09% of all loans were in some stage of foreclosure as of the end of the second quarter. That's down 13 basis points compared to the first quarter and down 40 basis points compared to the second quarter of 2014, the MBA reports.

It was the lowest foreclosure inventory rate since the fourth quarter of 2007.

The percentage of loans on which foreclosure actions were started during the second quarter was 0.40%, a decrease of five basis points compared to the first quarter but basically unchanged relative to the second quarter of 2014.

The serious delinquency rate, the percentage of loans that are 90 days or more past due or in the process of foreclosure, was 3.95%, a decrease of 29 basis points from the previous quarter, and a decrease of 85 basis points from the second quarter of 2014. This was the lowest level since the fourth quarter of 2007.

Marina Walsh, vice president of industry analysis for the MBA, says "nearly every state in the nation reported declining foreclosure inventory rates over the second quarter."

"The overall delinquency rate for Federal Housing Administration [FHA] loans dropped to 9.01 percent in the second quarter from 9.10 percent, as the 90 day or more delinquent category declined," Walsh says in a statement. "However, the 30-day and 60-day delinquency rate was up by a combined 10 basis points from the previous quarter. In addition, the FHA foreclosure inventory rate rose to 2.68 percent in the second quarter, four basis points higher than the previous quarter but still 13 basis points lower than a year ago. As more recent loan vintages begin to age and as older vintages enter the foreclosure process, we may see volatility in FHA delinquency and foreclosure rates."

Walsh points out that although only 40% of all mortgage loans serviced are in judicial states, "these states account for a growing majority of loans in foreclosure."

"For states where the judicial process is more frequently used, 3.41 percent of loans serviced were in the foreclosure process, compared to 1.15 percent in non-judicial states," she says. "States that utilize both judicial and non-judicial foreclosure processes had a foreclosure inventory rate closer that of the non-judicial states at 1.36 percent."

New Jersey, New York, and Florida had the highest percentage of loans in foreclosure in the second quarter.

"Despite a 36 basis point decline in foreclosure inventory over the first quarter, New Jersey's foreclosure inventory rate was still 7.31 percent, while New York, which had a 20 basis point decline over the first quarter had the second highest foreclosure inventory rate at 5.31 percent," Walsh says. "Both states primarily use a judicial foreclosure process."

Although it is still lingering, the foreclosure inventory is shrinking faster than it was in a majority of the judicial states.

see more: http://www.mortgageorb.com/e107_plugins/content/content.php?content.17101

Mortgage applications land flat for week

Mortgage applications increased 0.1% from one week earlier, according to data from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey for the week ending August 7, 2015.

The Market Composite Index, a measure of mortgage loan application volume, increased 0.1% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 1% compared with the previous week. The Refinance Index increased 3% from the previous week to its highest level since May 2015. The seasonally adjusted Purchase Index decreased 4% from one week earlier. The unadjusted Purchase Index decreased 4% compared with the previous week and was 20% higher than the same week one year ago.

The refinance share of mortgage activity increased to 53.1% of total applications from 51.3% the previous week. This is the highest refinance share since April 2015. The adjustable-rate mortgage (ARM) share of activity remained unchanged at 6.8% of total applications.

The FHA share of total applications decreased to 13.3% from 13.8% the week prior. The VA share of total applications increased to 11.3% from 10.5% the week prior. The USDA share of total applications decreased to 0.7% from 0.8% the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) remained unchanged at 4.13%, with points decreasing to 0.31 from 0.34 (including the origination fee) for 80% loan-to-value ratio (LTV) loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,000) remained unchanged at 4.08%, with points increasing to 0.34 from 0.27 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.

read more: http://www.housingwire.com/articles/34741-mortgage-applications-land-flat-for-week

Ask an Attorney: Foreclosure of a second mortgage

Question: Back in 2009 when the economy tanked, I took a pay cut at my job and couldn’t afford to pay my mortgages. In 2013, I got a loan modification on my first mortgage and have been making payments on it for the past two years. Now, my second mortgage is threatening to foreclose. They tell me that unless I pay six years of past-due payments, they’re going to take my home. Can they do that? I thought second mortgages can’t foreclose. Please help!

Lenders that hold liens in second position, often referred to as second mortgages and/or HELOCs, typically have the right to foreclose on a home when the loan is in default. Collectively, all nonpriority liens placed after a first mortgage are called junior mortgages, and lien holders generally have the right to foreclose when the repayment terms are not met.

That said, it isn’t so much that junior lien holders can’t foreclose. A more accurate statement is that second lien holders typically don’t foreclose. The reasoning is simple.

NRS 40.462 explains how the proceeds of a foreclosure auction are distributed to various lien holders. Essentially, mortgage liens are paid in the order they were recorded on the property. The first mortgage is paid first, the second is paid second and so on. So, for example, if a first mortgage holder is owed $150,000 and the second mortgage holder is owed $50,000, there is no benefit for the second mortgage holder to foreclose unless the house will sell at auction for more than $150,000.

In other words, unless the sale price on the foreclosed property is higher than the first mortgage, the second mortgage holder won’t get any money, even if it were to foreclose.

Applying this to what happened recently in Nevada, lenders with second and third mortgages on properties that had values less than what was owed on the first mortgage wouldn’t foreclose. Instead, they waited until homeowners modified their first mortgages, often lowering the amounts owed on the homes, then waited until property values recovered enough that foreclosure would get them paid — at least in part. Now that home values have risen, junior mortgage foreclosure is becoming more common.

This isn’t the end of the world, though. Junior mortgages can be modified and/or reinstated. In some cases, it also is possible to settle the balance for pennies on the dollar or get them stripped entirely with zero cash out of pocket.

If you are going to pursue one of these alternatives, I’d urge you to act quickly before home values rise too far. The less your home is worth, the greater the chance to work something out with your junior lender.

read more: lasvegassun.com/native/panda/2015/aug/09/ask-an-attorney-foreclosure-second-mortgage/

J.P. Morgan Loosens Terms for Huge Mortgages

According to Market Watch J.P. Morgan Chase & Co. is slackening its endorsing criteria for major mortgages, as competition to grab a bigger share of the high-end housing market among lenders rapidly rise.

The nation's largest bank, J.P. Morgan Chase & Co., plans to release an announcement as soon as Tuesday that it is lowering the minimum credit score and down payment it will requires for mortgages as great as $3 million.

The move of the big New York firm is similar to the steps of firms like the Bank of America Corp, Wells Fargo & Co., and other banks for requirements on big mortgages, for example those that exceed $417,000 in most parts of the country or $625,500 in high-priced markets.  At the same time, the big banks are veering away from smaller loans where regulatory and litigation risks are higher.

 

Following the financial crisis, a recovery in the economy including the mortgage market has faced a lot of challenges, but the jumbo market, which is prevalent with wealthy borrowers, has rebounded along with sales of more expensive homes. In the second quarter, overall jumbo beginnings went up to an eight-year high that is at $93 billion, up by 58 percent from a year ago, according to an initial estimate from an industry newsletter Inside Mortgage Finance.

Furthermore, by dollar volume, big mortgages given out by moneylenders last year accounted for about 20 percent of all first-lien mortgages, used for the purpose of purchasing or refinancing a home, according to Inside Mortgage Finance. That is up from 5.5% in the year 2009. By record, the last time jumbo mortgages accounted for a larger share was way back in 2005.

J.P. Morgan Chase & Co (NYSE: JPM) is one of the oldest financial institutions in the United States with its head office located in New York City, New York.

read more: http://www.realtytoday.com/articles/24925/20150805/j-p-morgan-loosens-terms-huge-mortgages.htm

The Risks of Refinancing Student Loans, Credit Cards and Mortgages

Refinancing high interest rate debt to a lower interest rate can be a great way to save money. While this strategy can make a lot of sense, there are some risks. Before signing on the dotted line, make sure you consider those risks carefully.

Student Loans

The student loan market has experienced dramatic growth, and Americans now owe a staggering $1.2 trillion, which is more than credit card debt. If you are making student loan payments today, your interest rate could be above 6%. The leaders in student loan refinancing offer variable interest rates as low as 1.90% and fixed rates as low as 3.50%. Refinancing to these rates could save borrowers more than $10,000.

But there are two big risks that you should consider before refinancing.

    If you have a federal loan, you will give up federal protections when refinancing to a private loan. The most important protection currently offered for federal loans is income-based repayment, which can cap your monthly payment to 15% of your discretionary income. If your income stays low, the federal programs even have principal forgiveness after 20 years.
    If you switch from a fixed interest rate to a variable interest rate, you will be taking significant interest rate risk. The last five years have made many of us believe that interest rates will always be low. However, history reminds us that rates can be a lot higher. Look for lenders that offer interest rate caps as a protection.

Refinancing private student loan debt makes a lot of sense. For federal student loan debt, you need to gauge the likelihood that your income could drop dramatically over the term of your loan. There are a number of lenders out there offering to refinance student loan debt, and you should shop around for the best deal. I keep an updated list of student loan refinance options, and interest rates, at my website MagnifyMoney.

Credit Cards

Americans still have a lot of credit card debt. According to NerdWallet, the average US household debt stands at $15,863. And the average interest rates on credit cards remain above 13%.

Marketplace lenders like Lending Club and Prosper are helping people refinance their credit card debt. On average, borrowers at Lending Club are receiving interest rates that are 31% lower than their credit card rate.

However, borrowers should consider two risks before proceeding.

    Most lenders charge an origination fee, which will not be reimbursed if you pay off your loan early. Although there are no prepayment penalties, the origination fee is a kind of prepayment penalty in disguise.

see more: http://www.forbes.com/sites/nickclements/2015/08/01/the-risks-of-refinancing-student-loans-credit-cards-and-mortgages/

Reverse Mortgage To Buy New Homes For Seniors

Seniors are also entitled the right to decent housing, and as such the reverse mortgages scheme has been proved useful in ensuring the security for a longer home stay for this age group.

Realtytimes.com discussed in a report following what's next on reverse mortgages. The advent of the reverse mortgages industry not only mobilized seniors into deciding whether to continue living in their current homes but has also offered seniors a better chance in purchasing a new home. The U.S. Department of Housing and the Urban Development FHA Reverse Mortgage To Purchase Program will allow them to experience the benefits of the traditional reverse mortgage scheme, for seniors who still have equity for their homes with the ability to supplement on their current income. Among the benefits that seniors can enjoy out of this kind of mortgage includes paying property taxes, home maintenance, as well as zero credit requirements. How this incentive works can be further read here.

Prior to doing a reverse mortgage loan, take note of using the services of an FHA (Federal Housing Administration) approved lender. A homeguides.sfgate.com article provides meaningful information as a guide to learning the ins and outs for this affordable home financing option, especially for borrowers with poor credit, on low income, even below minimum down payment funds. Health care centers, homes with single or multi-family dwellings and senior citizens can be insured through an FHA loan.


Another article on the benefits of reverse mortgages was also featured in aag.com. An inviting reason to choose it as a safe financial tool is: the borrower has no personal liability, thus safeguarding the borrower from owing more than what the house costs if sold. Read more about them here

read more: http://www.realtytoday.com/articles/23097/20150728/reverse-mortgage-buy-new-homes-seniors.htm

Refinancing? 3 Mortgages That Require Less Documentation

Looking to avoid all the paperwork associated with getting a mortgage? Here are three loan programs with no laundry list. See if you’re eligible…

Most mortgage loan products require you to provide two years of tax returns and W-2s, 30 days of pay stubs and at least two months of bank statements to provide a basis demonstrating your ability to repay the note. If you’re buying a home, there’s no back step, you will be subject to the scrutiny of the bank’s underwriter.

If you are looking to reduce your fixed housing costs here’s three programs that could meet you in the middle of the road. After all, who wants to go through a financial analysis every time you want to save a few hundred dollars per month?

Harp 2 -

If your loan is owned by Fannie Mae or Freddie Mac, and it was taken out no later than May 31, 2009 you’re gold. The role of the Making Homes Affordable Programwas to aid homeowners in refinancing due to loan-to-value restrictions, do so without limitation. The program still has the same flexible appraisal threshold. Each mortgage company offering the program must perform an automated underwriting analysis on your loan application. Automated underwriting is the nationwide algorithm lenders use in originating loans sold to Fannie Mae and Freddie Mac. The automated underwriting results determine a loan that is eligible for sale delivery to either entity. If the automated underwriting results reveal your loan does not require an appraisal, you need not obtain one. Additionally, even if you have a debt to income ratio as high as 60%, this may also fly with your mortgage company.

Mortgage tip: some mortgage companies have debt related adjustors built into their origination guidelines, meaning that even though the program does not have a debt to income ratio requirement, you might still be limited to 45% and it may mean having to request an exception for approval.

Additionally, if automated underwriting only requires pay stubs and for example one year of federal income tax returns, you need only that information in conjunction with your mortgage loan application. This may be acceptable with the mortgage company who we were working with to provide documentation specifically consistent with the automated underwriting results.

The same credit characteristics might apply as identified above, your mortgage company may still require full documentation. For the loan to be considered eligible for delivery to Fannie Mae and Freddie Mac, the only documentation that is required is specifically identified on the automated underwriting result your loan officer has access to. If your mortgage company is still asking you for more financial documentation, ask them to provide a copy of the Desktop Underwriter (Du) Fannie Mae’s algorithm or Loan Prospector (LP) Freddie Mac’s algorithm results on your application.

read more: http://patch.com/california/northhollywood/refinancing-3-mortgages-require-less-documentation

Former coach of Andy Murray visits Broadstairs tennis club

While Andy Murray was helping Britain to their first Davis Cup semi-final in 34 years, a former coach of his was putting the next generation of tennis stars through their paces in Broadstairs.

Jason Barnett, who worked with the 2013 Wimbledon champion when he was just nine, travelled from Aberdeen to Broadstairs & St Peter's Lawn Tennis Club for the weekend.

He held sessions with the club's senior and junior players across the weekend, and believes the future of tennis is bright on the Isle.

"It's lovely," he said. "It's good to come down and play some tennis in an area where there's actually some good weather.

"I've been coaching up in the Highlands and the conditions are tough. It's nice to come down into a lovely, vibrant club, and see familiar faces, get them on court and improving their tennis."

"The enthusiasm in this club is brilliant and what we need to do is capitalise on that.

"Tennis is a sport where I feel it's not embraced enough when we have the biggest tournament on the planet in Wimbledon."

Barnett, now 40 and a former world number one in the over-35 game, believes Murray's achievements can be the catalyst for a spike in tennis participation.

And he still remembers the driven youngster he worked with at Stirling University almost 20 years ago.

"He was feisty as he still is and he wasn't short of telling me his opinions about tennis, even at nine," Barnett said. "You need that forceful attitude and I'm so impressed with his work ethic, how hard he trains and the role model he has become for tennis.

"Hopefully we can get more people playing tennis. Andy winning Wimbledon could hopefully be like a Bjorn Borg effect in this country, where all the boys will be inspired and catch on to that dream and maybe think they can achieve it.

Read more: www.thanetgazette.co.uk/coach-Andy-Murray-visits-Broadstairs-tennis-club/story-27446659-detail/story.html

Bank of America says it’s No. 2 for mortgage customer satisfaction. So does Chase.

In the competitive U.S. mortgage market, bank giants are battling to be runner-up in customer satisfaction for home loans.

On Wednesday, Bank of America BAC, +0.83%  boasted of earning the No. 2 spot in J.D. Power’s customer-satisfaction study for mortgage originations. On Tuesday J.P.Morgan Chase JPM, +0.51%  proclaimed it was No. 2 in J.D. Power’s customer-satisfaction study for mortgage servicing.

Both claims are true, with a caveat: USAA out-scored Bank of America in the origination study, but it wasn’t included in the ranking because its mortgages are only available to those who have been or are in the military, plus their families.

So, who is No. 1 for mortgage-customer satisfaction? That’s Quicken Loans, an online lender based in Detroit. Quicken nabbed top spots last year in customer satisfaction for both originations and servicing.

For the origination survey, Quicken has ranked No. 1 for five consecutive years, with good marks for loan offerings, the application and approval process, and problem resolution, among other categories. For the servicing study, 2014 was the first year that J.D. Power included Quicken, which promptly beat its competition. Quicken performed well in categories such as billing and payment process and escrow-account administration.

source: http://www.marketwatch.com/story/bank-giants-battle-to-be-no-2-for-mortgage-customer-satisfaction-2015-07-15

Millions could be saving $200 a month on mortgages

About 6.5 million mortgage borrowers could qualify for and benefit from refinancing their home loans, according to the "Mortgage Monitor Report" from Black Knight Financial Services, which could translate into massive savings for those consumers.

The report, based on May 2015 data, puts the total potential annual savings at $20 billion, with as many as 3 million borrowers saving at least $200 a month inmortgage payments.

The vast majority of homeowners could realize these savings through traditional refinancing, the analysis showed, while roughly 450,000 homeowners would be eligible for lower interest rates on their home loans through HARP, the Home Affordable Refinance Program. HARP is geared toward borrowers whose homes have declined in value, therefore preventing them from securing traditional refinancing.

Black Knight arrived at these figures by analyzing borrower and mortgage data, specifically the 30-year fixed-rate loan. In a news release about the analysis, Black Knight noted that rate fluctuations could change borrowers' ability to save.

"It's important to remember how rate-sensitive this population is, too," said Ben Graboske, senior vice president of Data & Analytics at Black Knight, according to the news release. "[I]f rates go up just half a percentage point, 2.6 million people fall out of that refinanceable population."

Rates haven't shifted much since May, but they have edged upward, suggesting that 6.5 million-borrower figure has already shrunk.

Borrowers considering a refinance also need to be sure that what you'll pay in upfront costs versus what you will save in monthly payments makes the move worthwhile for you. You'll have to consider closing costs and also the amount of time you want to stay in the home. For example, if you're planning to sell in the next couple of years, be sure to crunch the numbers and make sure the savings are worthwhile in the long-run.

see more at : http://www.usatoday.com/story/money/personalfinance/2015/07/12/credit-dotcom-saving-on-mortgages/29892627/

Landlords fear budget tax squeeze

The National Landlords Association has sent a letter to Chancellor George Osborne warning against altering the current system, which allows rental income to be offset against mortgage interest payments.

Richard Lambert, the NLA's chief executive, wrote: "It has been suggested that private landlords receive too many perks or reliefs which give them an unfair advantage compared to owner-occupiers, but this ignores the fact that letting residential property for profit is a business.

"Removing their ability to deduct legitimate costs before declaring their taxable profit would essentially force them to suck up one of the most significant expenses they face in being able to provide homes for others.

"I hope you will give an unequivocal reassurance that the government will continue to regard Buy-to-Let mortgage interest payments as a legitimate business cost and give landlords the confidence and certainty to invest for the future."

John Heron, the managing director of buy-to-let lender Paragon Mortgages, agreed that it would have a negative impact on the UK economy should the government meddle with the current system.

He said: "It's an entirely reasonable way for landlords to be treated and it works in the same way as any other business would operate.

"I haven't seen any official source that suggests there might be any changes, but you never know with budgets."

Previously the NLA has warned that if mortgage interest payments were classed as non-deductible landlords would have to raise rents to compensate.

see more: http://www.mortgageintroducer.com/mortgages/253036/5/Industry_in_depth/Landlords_fear_budget_tax_squeeze.htm

Nonprofit: Seniors can learn about reverse annuity mortgages

Find out what happens to older adults when their trust is undermined by con artists, unscrupulous sales people, risky investments or unfair financing plans.

Missoula Aging Services and Montana Senior Medicare Patrol are presenting a free documentary film screening Wednesday, July 15, from 1 to 2:30 p.m. at the Missoula Senior Center, 705 S. Higgins Ave. The film “Fleeced” shows examples from around the country of how seniors are protecting themselves from financial fraud and fighting back. It will be followed by a panel discussion with local experts from Adult Protective Services, Missoula Police Department and financial services.

The event is free and open to the public.

***

The 2015 Power of Pink Variety Show invites singers, dancers, actors and other performing artists to volunteer their talents to help end breast cancer in Ravalli County. Every act is asked to prepare a piece based on the theme of hope and strength, rehearse it, and come to one dress rehearsal Sunday, Sept. 27. The show will be performed at the Mary Stuart Rogers Theater in Victor on Friday, Oct. 2.

If you would like to participate, auditions will be held Thursday, July 30, from 4 to 6 p.m. at Marcus Daly Memorial Hospital in Conference Room C. Call Sherry at 375-4675 to reserve an audition slot.

The Power of Pink is supported by community members, Mary Stuart Rogers Performing Arts Center, Victor schools, Ravalli County dance and theater companies, Bitterroot Valley Chamber of Commerce and Marcus Daly Memorial Hospital.

see more:  http://missoulian.com/lifestyles/hometowns/nonprofit-seniors-can-learn-about-reverse-annuity-mortgages/article_cdf699d8-d76c-5a10-9e39-57275e8ad33a.html

Average US Rate on 30-Year Mortgage Edges up to 4.02 Pct.

Average long-term U.S. mortgage rates were mixed last week, marking slight increases or declines but remaining close to high levels for the year.

Mortgage giant Freddie Mac said the average rate on a 30-year fixed-rate mortgage edged up to 4.02 percent this week from 4 percent a week earlier. The rate on 15-year fixed-rate mortgages slipped to 3.21 percent from 3.23 percent.

Mortgage rates have increased in recent weeks, in the midst of the spring home buying season, as the economy has shown signs of improvement.

Government data issued showed that purchases of new U.S. homes surged in the Northeast and West last month, as steady job growth over the past year has lifted the housing market. Sales of new homes have soared 24 percent year-to-date and are on pace for their best year since 2007. They've been bolstered by the additional incomes from employers hiring 3.1 million workers in the past 12 months and mortgage rates that remain low by historical standards despite their recent increase.

A year ago, the average 30-year rate was 4.14 percent; the 15-year was slightly above its current level, at 3.22 percent.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country at the beginning of each week. The average doesn't include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.

The average fee for a 30-year mortgage was unchanged from last week at 0.7 point. The fee for a 15-year loan rose to 0.6 point from 0.5 point.

The average rate on five-year adjustable-rate mortgages fell to 2.98 percent from 3 percent; the fee remained at 0.4 point. The average rate on one-year ARMs declined to 2.50 percent from 2.53 percent; the fee rose to 0.3 point from 0.2 point.

read more: http://www.edgeboston.com/business/corporate/news/179960/average_us_rate_on_30-year_mortgage_edges_up_to_402_pct

Strong housing data pushes 30-year fixed mortgage rate higher

Economists have been declaring for years that mortgage rates were going to rise. Now those predictions seem to be coming true.

As the Federal Reserve contemplates raising its benchmark federal funds rate, home loans are becoming more expensive. Indications are that the days of the 30-year fixed-rate home loan at a rate below 4 percent are gone, if not for good, certainly for a long time.

For the third week in a row, the 30-year fixed-rate average remained above the 4 percent mark, according to the latest data released Thursday by Freddie Mac. It rose to 4.02 percent with an average 0.7 point this week. (Points are fees paid to a lender equal to 1 percent of the loan amount.) The 30-year fixed rate was 4 percent a week ago and 4.14 percent a year ago.

Although rates are rising, they remain near their all-time lows. The 30-year fixed-rate average hasn’t been above 5 percent since February 2011, and it hasn’t topped 6 percent since November 2008.

The 15-year fixed-rate average dropped to 3.21 percent with an average 0.6 point. It was 3.23 percent a week ago and 3.22 percent a year ago.

Hybrid adjustable rate mortgages also fell. The five-year ARM average edged down to 2.98 percent with an average 0.4 point. It was 3 percent a week ago and 2.98 percent a year ago.

The one-year ARM average slipped to 2.5 percent with an average 0.3 point. It was 2.53 percent a week ago.

see more at: http://www.washingtonpost.com/blogs/where-we-live/wp/2015/06/25/strong-housing-data-pushes-30-year-fixed-mortgage-rate-higher/

70% of Greek mortgages aren't being paid

The economy in Greece is so bad that Greeks have stopped paying their personal and consumer debts and are raising cash by selling family heirlooms, according to an astonishing article in the Financial Times.

Here is the scariest quote:

“There’s a real issue of moral hazard  . . .  Around 70 per cent of restructured mortgage loans aren’t being serviced because people think foreclosures will only be applied to big villa owners,” one banker said.

Greece has become an upside-down world where no one feels ashamed about not paying their debts, the FT reports, because no one can pay their debts:

The family still owes a year’s worth of school fees at the private international school their daughter attended, which George admits is not a priority. He is no longer embarrassed by his inability to pay, he says, because so many other parents are in the same situation.

At the same time, consumers are pulling all their cash out of the Greek banks, for fear they will fail. Greece needs to make a €1.5 billion payment to the IMF by the end of June.

Read more: http://www.businessinsider.com/70-of-greek-mortgages-arent-being-paid-2015-6

The foreclosure crisis would have happened even without risky mortgages

 Finally, it seems, the mainstream press is beginning to get it right.

Too bad it only took the better part of a decade.

Fortune published this gem on recent research that suggests the foreclosure crisis would have happened even without risky mortgages.

Chris Matthews’ balanced look at a working paper by Wharton economists Fernando Ferreira and Joseph Gyourko, finds that prime mortgage foreclosed at a greater pace than subprime from 1997 to 2012.

 The authors note: "The private label subprime mortgage-backed securities market did not really boom until late in the last housing cycle, so these data do not become nationally representative until the middle of the last decade."

However, by the time the bubble burst, the press found itself drawn, wrongly so, to the exciting, explosive "subprime" nomenclature.

In an interview with Matthews, Ferreira states that even putting 20% down for a mortgage won’t protect against widespread defaults when economic bubbles burst.

Here’s Matthews’ expert takeaway:

    We can draw two conclusions from this data. One is that your chances of being foreclosed upon in the past decade was more a matter of timing than anything else. If you were a subprime borrower in, for instance 2002, who bought a bigger house than a more prudent and creditworthy borrower would have bought, chances are you would have been fine. But a prime borrower who did everything right—bought a house he could easily afford, with a large downpayment—but did so in 2006 would have had a higher chance of defaulting than the subprime borrower with better timing.

read more: http://www.housingwire.com/blogs/1-rewired/post/34244-the-foreclosure-crisis-would-have-happened-even-without-risky-mortgages

What you should know before taking out a reverse mortgage

If you took out a reverse mortgage without adding your spouse to the documents, do you know what could happen with the property after you die?

Did you know you could lose the house if you forgo maintenance or get behind on property taxes?

Are you under the impression the mortgage is with the government?

Reverse mortgages, which typically pay homeowners 62 and older a portion of their home equity until the borrower dies or moves, are complex products with provisions that occasionally are a moving target.

    Reverse mortgage advertisements are definitely downplaying the requirements and risks involved. These ads create confusion among senior citizens who are in dire need of additional funds. I've read from revmortgage several reverse mortgage guidelines that can help borrowers understand the...

So it's little surprise that when the Consumer Financial Protection Bureau recently showed consumer ads about the products to about 60 seniors who had very little knowledge about them, the homeowners had trouble even understanding that the products were loans that have to be repaid.

"As older consumers consider reverse mortgage loans to tap into their home equity, they need to be careful of those late-night TV ads that seem too good to be true," CFPB Director Richard Cordray said in issuing a consumer alert about the products. "It is important that advertisements do not downplay the terms and risks of reverse mortgages or confuse prospective borrowers."

CFPB officials stopped short of claiming any of the 97 ads met the regulatory definition of deceptive marketing practices, and a trade group representing reverse mortgage lenders said it has filed a freedom of information act to review the ads used in the focus groups.

But the false impressions created by the print, TV and web ads pointed out some useful tips for seniors who are starting to research whether such a product is right for them, and recent changes to some of the terms affecting holders of reverse mortgage holders are worth noting.

These are not government loans. While lenders offering federally insured reverse mortgages must comply with certain rules, the loans themselves are not taken out directly with the government.

Read the fine print. Homeowners applying for a federally insured home equity conversion mortgage (HECM) are required to undergo counseling about the terms. Make sure you understand them before signing, including the fact that you could face foreclosure if you fail to maintain the property or pay property taxes. The CFPB said few ads mentioned interest rates or repayment terms.

see more: http://www.chicagotribune.com/business/yourmoney/sc-cons-0618-journey-20150615-column.html

Borrowers Underwater on Their Mortgages Decline

Home-price gains are pulling more mortgage borrowers above water, but the problem of borrowers owing more on their homes than they are worth could persist in some markets for years to come.

At the end of the first quarter, 15.4% of homeowners with a mortgage—or about 7.9 million—had mortgage balances that surpassed their homes’ value, according to real-estate information company Zillow Group Inc., down from 16.9% in the fourth quarter of last year.

But 4 million of the underwater borrowers owed at least 20% more than their homes were worth, Zillow said, leaving them little reason for cheer even as the housing market heats up around them.

The negative-equity problems could lead to higher foreclosure rates in hard-hit markets while also limiting the supply of homes for sale, said Zillow chief economist Stan Humphries.

“It’s clear that it’s going to be a long-term problem in the housing market, not a short-term problem we can quickly get past,” said Mr. Humphries.

Negative equity was especially prevalent on homes with lower values and in markets hardest hit by the financial crisis, Zillow said.

More than a quarter of owners with a mortgage on the least-valuable third of homes were underwater, Zillow said, compared with 8% in the most valuable third of homes. Housing markets with the highest levels of negative equity included Atlanta, Chicago and Las Vegas.

In Phoenix, where 19% of mortgaged homes in the first quarter were underwater, tight inventory at the lowest price points is frustrating many buyers, said Michael Orr, director of Center for Real Estate Theory and Practice at the W.P. Carey School of Business at Arizona State University. He said for-sale homes priced below $200,000 are typically getting many offers.

The number of active listings overall in Phoenix fell 19% between May 1, 2014, and May 1 this year, Mr. Orr said, while median prices rose to $215,000 from $204,500.

“It’s quite a significant part of the reason that we’ve got low supply,” Mr. Orr said. “Some of them are not in financial difficulty but can’t sell. They would rather just sit on it and hope that at some point prices go back up.”

see more: http://www.wsj.com/articles/borrowers-underwater-on-their-mortgages-decline-1434081661

Reverse mortgages worth a look, if approached with caution

LOS ANGELES - Even as regulators are firing shots at reverse mortgages for what they consider deceptive advertising, financial planners are taking a new look at these loans as a way to avoid selling stocks.

New research suggests the products may actually be worth a look if one can tune out the possibly shady sales tactics.

Reverse mortgages allow homeowners aged 62 and above to borrow against their home equity, and to receive either a lump sum, a series of monthly checks or a line of credit that can be tapped as needed. The debt does not have to be repaid until the borrower leaves the home by selling it, moving out or dying.

Philadelphia has proved a popular place for reverse mortgages, ranking at the top for the number of such mortgages awarded since 2011, according to an analysis of Federal Housing Administration data for The Associated Press by Reverse Market Insight, a California-based company. The city, where many families have lived in the same close-knit neighborhoods for decades, was followed by Los Angeles, Washington and Chicago in 2014.

The Consumer Financial Protection Bureau slammed industry advertising earlier this week, saying it misled people about the risks and costs of such loans. Older homeowners in the bureau's focus groups "were generally confused" by the ads, director Richard Cordray told a news conference.

The ads gave people the impression that a reverse mortgage is "a risk-free government benefit" rather than a loan with fees and compounding interest that increases the balances owed over time, he said. Reverse mortgages typically are insured by the federal government but are made and serviced by for-profit private lenders.

Cordray also took aim at ads that feature celebrity endorsers such as Henry Winkler, Robert Wagner and former U.S. Senator Fred Thompson, without mentioning them by name.

"These well-known actors, even a former senator, add a false air of credibility to the products," Cordray said.

read more: http://www.phillyvoice.com/reverse-mortgages-worth-look-if-approached-caution/

Bank of America wins Supreme Court ruling on ‘underwater’ home mortgage

WASHINGTON — The U.S. Supreme Court on Monday handed a win to Bank of America Corp by ruling that a second mortgage on an “underwater” home - one with a mortgage balance exceeding its current value - cannot by voided during bankruptcy.

On a unanimous vote, the court ruled against two homeowners, David Caulkett and Edelmiro Toledo-Cardona, in Florida, where many homeowners have struggled to pay their mortgages following the recent housing crisis.

Caulkett and Toledo-Cardona had both won before the regional appeals court that oversees Florida. The 11th U.S. Circuit Court of Appeals had ruled that homeowners in Chapter 7 bankruptcy can void - or in bankruptcy terms “strip off” - a second mortgage when the debt owed to the holder of the first mortgage is more than the property’s current value.

That means the lender loses its ability to foreclose on the property even if its value increases.

But Bank of America, which is the second mortgage holder in both cases, argued in court papers that the approach taken by the 11th Circuit was different than other appeals courts around the country.

source: http://www.reviewjournal.com/news/nation-and-world/bank-america-wins-supreme-court-ruling-underwater-home-mortgage

Solar Savings For Veterans With VA Energy Efficient Mortgages

Memorial Day reminds Americans of the millions who have served in uniform over the years. Almost everyone knows a soldier, past or present. Education, health care, home loans, and other benefits accrue as each military employee serves out his or her term. But did you know that military service also offers every vet enhanced real estate value with home solar credit for improvements that boost energy efficiency and save a lot of money?

You’ve heard Cost of Solar reveal the many benefits of rooftop solar systems. The US Department of Veterans Affairs has yet another one here. Veterans can qualify for a lot more than the cost of their homes from the Energy Efficient Mortgage provisions built into the government’s Energy Star program.

From the website: “An Energy Efficient Mortgage (EEM) is a mortgage that credits a home’s energy efficiency in the mortgage itself. EEMs give borrowers the opportunity to finance cost-effective, energy-saving measures as part of a single mortgage and stretch debt-to-income qualifying ratios on loans, thereby allowing borrowers to qualify for a larger loan amount and a better, more energy-efficient home.”

To obtain home solar credit through an EEM, the VA borrower hires a home energy rater to assess the property’s current energy efficiency. If you’re a veteran and considering buying a home, ask your lender about the VA’s energy-efficient mortgages.

Here are a few ways veterans and their families can profit from bundling home solar credit via an energy efficiency loan with their traditional mortgage.

Improve your building’s energy performance. Your energy-efficient mortgage can use a number of power-saving technologies to improve your home’s energy efficiency. These include making your heating, cooling, ventilation, and other systems work to their highest design specifications in terms of speed and efficiency.

Reduce monthly utility bills. Some homeowners who install solar panels actually cut their monthly utility bills in half! They save thousands of dollars annually and quickly pay back the renewable investment. Creative financing is now available so that homeowners can either lease a solar system (under a variety of plans) or purchase it to save money in the long run. Many utilities offer ways to sell back the extra power you generate to the grid. Although these options vary company-by-company and from state to state, they are becoming more common as people begin to realize the hidden costs of fossil fuels and nuclear power.

see more: https://cleantechnica.com/2015/05/28/solar-savings-for-veterans-with-va-energy-efficient-mortgages/

Will a reverse mortgage be your friend or foe?

Your nest egg is small. Your retirement income is limited. And you're sitting on a highly appreciated asset—your home. A reverse mortgage, which lets you convert some of that equity into cash, might just solve the problem.

Depending on your health and financial stability, however, it could also create new ones.


"Reverse mortgages can be an effective tool for retirees, but the problem is that the interest rates tend to be higher than for other home loans," said Grafton "Cap" Willey, managing director at CBIZ MHM tax accounting and consulting firm. "I've also seen people outlive their ability to take any more equity out of their home and then they're forced to make tough decisions."

Indeed, cash-strapped seniors who spend all their available equity and later fall behind on property taxes and homeowner's insurance, he said, must sell their home and downsize, go back to work if they're able, or face foreclosure.

A reverse mortgage—the federally insured version is called a Home Equity Conversion Mortgage, or HECM—is a loan that enables homeowners age 62 and older to cash out a portion of the equity in their home.

The amount homeowners can borrow varies by lender but generally is based on age, home value and the interest rate at the time they close.

The National Reverse Mortgage Lenders Association offers an online calculator that gives borrowers a better idea of how much they might be eligible to take out.

As the name implies, the mortgage payment stream under such loans is reversed.

read more: http://www.cnbc.com/id/102688446

Average mortgage rate falls to 3.8%

    Mortgage rates in the U.S. fell for the first time in a month, cutting costs for buyers during the housing market’s busiest time of the year.

    The average rate for a 30-year fixed mortgage slipped to 3.84 percent from 3.85 percent last week, Freddie Mac said in a statement Thursday. The average 15-year rate declined to 3.05 percent from 3.07 percent, according to the McLean, Virginia- based mortgage-finance company.
    Mortgage rates have fluctuated within a range of about a quarter percentage point this year as investors try to guess the Federal Reserve’s timetable for ending the near-zero rates it has given banks to encourage them to lend. The shift probably won’t happen by the end of June, according to minutes of the Federal Open Market Committee’s April meeting, released Wednesday. While the overnight lending rate doesn’t directly impact home-loan rates, it influences mortgage investors who worry about inflation.
    “We know the general direction of mortgage rates will be higher this year as the economy gets stronger,” said Mark Zandi, chief economist of Moody’s Analytics Inc. “With the economy at full employment, the housing market will be able to gracefully digest it.”
    The average rate for a 30-year fixed mortgage probably will reach 4.3 percent by the fourth quarter, according to the Mortgage Bankers Association. It probably won’t break 5 percent until mid-2016, the trade group said in a forecast this week. Home lending probably will total $1.3 trillion this year, up 14 percent from 2014, as economic improvements spur gains in home sales and prices, according to the association.

read more: http://www.telegram.com/article/20150521/UNKNOWN/150529782/-1/NEWS07

Personal Finance: Reverse mortgages: friend, foe?

It is difficult to avoid TV celebrities endorsing reverse mortgages for seniors needing extra income or cash to pay bills. But are these products truly useful options, or dangerous traps?

Used properly and entered into advisedly, a reverse mortgage can be a valuable tool for older homeowners with limited income and significant home equity. But like any financial contract, it must be well understood and should only be considered under appropriate conditions.

Virtually any homeowner can borrow against the equity in their home by taking out a second mortgage, a home equity line, or a new first mortgage. However, repayment typically begins immediately and continues as a monthly obligation until fully repaid.

A reverse mortgage is effectively a home equity loan with a twist. Homeowners who qualify can borrow against a significant proportion of their home equity to spend today, but are not required to repay the loan until their death or until they choose to sell the property. Technically referred to as Home Equity Conversion Mortgages (HECM), these loans are regulated by the U.S. government through the FHA. To qualify, all borrowers must be at least 62 years of age and have a minimum amount of equity in the home. Furthermore, there must be no other loans outstanding against the home (or the borrower must use proceeds of the HECM to pay off any outstanding loans).

The proportion of equity available for borrowing is limited, and there are significant fees associated with origination. However, unlike a traditional mortgage, these loans are nonrecourse: if the market value of the home falls below the loan value, the lender bears all the risk and the borrower has no obligation to offset the difference.

As beneficial as a reverse mortgage can be in the right situation, too many stories surfaced of borrowers who lost their homes because they had not sufficiently understood the terms or had failed to make required insurance and tax payments. Industry data suggested that in 2012 roughly 10 percent of these arrangements were in default because the borrower had spent all the proceeds and did not have the cash flow to keep up with property taxes and insurance premiums as required by the terms of the loan. A default rate that high was cause for concern, and as a result FHA revised its lending standards.

Effective last month, lenders are now required to verify that the borrower will have sufficient income to meet ongoing required expenses including insurance and taxes. In addition, seniors who enter into reverse mortgage agreements may request that the lender withhold proceeds from the loan in an escrow account to assure sufficient coverage of expenses and minimize the risks of unpleasant surprises later on.

The other main pitfall with reverse mortgages is the risk of fraud. Since these products are specifically designed to benefit seniors, the target clientele is frequently the object of scammers. It is therefore essential that potential borrowers contact the FHA (or its parent agency HUD) to verify the lender is legitimate. New rules require that borrowers speak with a HUD-approved counselor before signing a contract. And as always, if you feel pressured or do not completely understand the terms, walk away. If you suspect fraud, contact the FHA to report the purveyor.

see more: http://www.timesfreepress.com/news/business/diary/story/2015/may/20/reverse-mortgages-friend-foe/305229/

Commercial Mortgages: Volatility and higher rates, but still a good month

Rising interest rates and plenty of volatility have made May a tough month in the commercial real estate world.

But commercial real estate investors are like Tom Brady, the New England Patriots quarterback. Brady, who learned last week that he will be suspended in the wake of the NFL’s investigation into deflated footballs, had a tough month but still comes home to a beautiful house and wife and still possesses four Super Bowl rings.

Likewise, interest rates aren’t quite as good as last month, but they are still pretty darn good — and investors still are doing pretty darn well.

Despite rising interest rates, competition between lenders and different lending sources is fierce. Banks are swarming developers looking for deals to add to their books. As one developer quipped, “I could go to lunch every day of the month with a different lender if I had the time.” While banks are pushing hard for new business, permanent lenders are also trying to get loans booked and find themselves battling each other as well as banks.

Data compiled by Trepp Bank Navigator on the top 100 banks in the country, ranked by commercial real estate loan portfolios, tell the story for what went on in 2014. Overall, these banks grew their loan portfolios an average of 6.8 percent last year. Some of the very largest banks such as Bank of America, BB&T and Regions shrank a bit, while others like M&T Bank and SunTrust had healthy growth.

Wells Fargo, which is winding down its real estate lending office in Richmond, is the largest real estate lender in the country and grew its real estate holdings by a paltry 0.8 percent in 2014, according to the data. Union Bank had a surge in real estate holdings of 75.2 percent when compared with 2013. No doubt the astronomical loan growth was based in large part on its merger with Stellar One Bank. This brought Union’s real estate holdings to $3.01 billion at the end of 2014, ranking it the 76th largest on the list.

The list measures the loans made by banks for land purchases and new development. Development and land loans grew by 15.2 percent during 2014 for the top 100 banks. This growth is an important metric to watch as it marks a turn from most prior years in the recovery, when development and land loans were shrinking.

A study by Mary Ludgin, who is the director of global investment research at Heitman and will be speaking at the VCU Real Estate Trends Conference in October, showed what most banks have experienced in the past seven years. Development activity during this recovery has been tempered. Even though loan growth for development loans was positive in 2013 and strong in 2014, across the country, completions for retail, office and industrial properties are well below 20-year averages. Only apartment completions in 2014 exceeded the 20-year average.

This is a positive for lenders and real estate investors alike, as less supply will eventually mean rental growth and price appreciation as employment and population growth continue. Another positive for investors, but perhaps not so much for lenders, is low rates.

According to the John B. Levy & Company Mortgage Survey, commercial mortgage rates increased during the last month in a fairly significant way, but remain low. Five- and 10-year loans now range from 3.40 to 3.80 percent, respectively, for top-rated mortgages. Full leverage 10-year conduit loans are closer to 4.25 percent.

see more: http://www.richmond.com/business/learning-center/article_b6a1d6ee-a699-532a-8368-ae7f1933f540.html

U.S. mortgage applications fall in latest week: MBA

Applications for U.S. home mortgages fell last week as interest rates rose to the highest level since March, an industry group said on Wednesday.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, fell 3.5 percent in the week ended May 8.

The MBA's seasonally adjusted index of refinancing applications fell 5.9 percent, while the gauge of loan requests for home purchases, a leading indicator of home sales, dipped 0.2 percent.

The refinance share of total mortgage activity fell to 51 percent of applications, its lowest level since May 2014, from 52 percent the week before.

Fixed 30-year mortgage rates averaged 4.00 percent in the week, the highest level since March. They were up 7 basis points from 3.93 percent the previous week.

The survey covers over 75 percent of U.S. retail residential mortgage applications, according to MBA.

see more: http://www.reuters.com/article/2015/05/13/us-usa-economy-mortgages-idUSKBN0NY18Y20150513

Nomura found liable for selling toxic mortgages to Fannie, Freddie

 A federal judge ruled Monday that Nomura Holdings (NMR) misled Fannie Mae and Freddie Mac made false representations about the quality of mortgages that were used to back $2 billion securities it sold to the GSEs.

According to court records, U.S. District Judge Denise Cote found Nomura liable when he ruled for the Federal Housing Finance Agency, which acts as conservator for the GSEs, after overseeing the non-jury trial.

"The offering documents did not correctly describe the mortgage loans," the judge said in his lengthy, 361-page decision. "The magnitude of falsity, conservatively measured, is enormous."

The FHA has taken two of the world’s biggest banks to trial in an attempt to recoup more than $1 billion over the $2 billion in mortgage bonds sold to Fannie and Freddie.

The FHFA is also suing the Royal Bank of Scotland (RBS), which served as the underwriter, for selling the mortgages into the secondary markets. Nomura and RBS were the first to stand up to the FHFA; several other banks have settled.

The trial is the first to come from some 18 lawsuits by FHFA back in 2011. The Federal regulator wants to recover some losses on some $200 billion in mortgage bonds the GSEs bought.

The FHFA is suing various big financial firms for the alleged misselling of toxic mortgages to Fannie Mae and Freddie Mac during the housing boom. The FHFA says the mortgages defaulted in large numbers, requiring default on the Fannie and Freddie bonds and led the bailout and conservatorship of the government-sponsored entities.

The FHFA said in its filing that 68% of a sample of the loans were not underwritten in accordance with underwriting guidelines and that appraised values were inflated on average by 11.1%.

Nomura and RBS denied the FHFA’s allegations.

“FHFA is pleased with the Court's decision and we are reviewing the various elements of this important ruling,” said FHFA General Counsel Alfred Pollard.  “It is clear the Court found that the facts presented by FHFA were convincing.  FHFA looks forward to submitting proposed damages calculated under the formulae applied in the Court's Opinion.”

If Nomura and RBS are ordered to pay damages, they would in turn receive the mortgage bonds, which are valued at just under $500 million.

see more: http://www.housingwire.com/articles/33855-nomura-found-liable-for-selling-toxic-mortgages-to-fannie-freddie

U.S. Mortgage Applications Dip 4.6 Percent

According to the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey for the week ending May 1, 2015, mortgage applications decreased 4.6 percent from one week earlier.

The Market Composite Index, a measure of mortgage loan application volume, decreased 4.6 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 4 percent compared with the previous week.

The Refinance Index decreased 8 percent from the previous week to the lowest level since January 2015. The seasonally adjusted Purchase Index increased 1 percent from one week earlier to its highest level since June 2013. The unadjusted Purchase Index increased 2 percent compared with the previous week and was 12 percent higher than the same week one year ago.

"Refinance volume dropped last week as rates in the US increased sharply towards the end of the week, with signs of recovery in Europe lifting rates across the globe. Purchase activity increased slightly over the week, and the average loan amount for a purchase application reached a record high, a sign that the mix of purchase activity is still skewed toward higher priced homes," said Mike Fratantoni, MBA's Chief Economist.

The refinance share of mortgage activity decreased to 53 percent of total applications from 55 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 6.1 percent of total applications. The average loan size for purchase applications rose to a survey high of $297,400.

The FHA share of total applications increased to 14.0 percent from 13.7 percent the week prior. The VA share of total applications increased to 11.9 percent from 11.3 percent the week prior. The USDA share of total applications remained unchanged at 0.8 percent from the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) increased to 3.93 percent from 3.85 percent, with points remaining unchanged from 0.35 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate increased from last week.

- See more at: http://www.worldpropertyjournal.com/real-estate-news/united-states/mortgage-applications-may-2015-mortgage-bankers-association-weekly-mortgage-applications-survey-mortgage-rates-mortgage-data-mortgage-interest-rate-9063.php

Moody’s: Stopping eminent domain seizures of underwater mortgages a credit positive

 The House of Representatives’ Appropriations Subcommittee approved a bill last week for Transportation, Housing and Urban Development appropriations for the fiscal year ending 30 September 2016.

If passed, the bill will deter municipalities from using eminent domain to seize underwater mortgages from residential mortgage-backed securities transactions at distressed prices in 2016, a credit positive for RMBS.

Moody’s Investors Service says in a client note that if municipalities were able to use eminent domain for such seizures in private-label RMBS, as they have discussed in the past few years, losses for those RMBS would increase.

The bill includes a provision that would nullify the key exit strategy to make the eminent domain plan profitable for its proponents.

The provision would prevent the Federal Housing Administration, the Government National Mortgage Association and Department of Housing and Urban Development from using funds to “insure, securitize, or establish a Federal guarantee of any mortgage or mortgage-backed security that refinances or otherwise replaces a mortgage that has been subject to eminent domain condemnation or seizure, by a state, municipality, or any other political subdivision of a state.”

Proponents of the eminent domain plan reportedly hoped to use eminent domain to force distressed sales of underwater loans and replace them with smaller government-insured mortgage loans that could be sold at a substantial profit.

The bill, which appropriates funds for the agencies for fiscal 2016, would prevent key government agencies from making loans available for such purposes during that time period.

Afterward, no such restriction would apply unless Congress enacts similar legislation the following year. The 2015 Omnibus Appropriations Bill, which became law, included a similar provision restricting the use of agency funds in 2015.

see more: http://www.housingwire.com/articles/33793-moodys-stopping-eminent-domain-seizures-of-underwater-mortgages-a-credit-positive

3 Tips for Refinancing a Fannie Mae Mortgage Under HARP in Phoenix

If you’re questioning what to do about an underwater mortgage, now is a good time to consider the Home Affordable Refinance Program (HARP) if you are eligible. Extended through the end of 2015, HARP is designed to help borrowers who are either underwater or nearly underwater refinance their homes.

Arizona State Credit Union can help borrowers with a Fannie Mae-backed loan take advantage of HARP and the credit union’s related services. While many Phoenix suburbs have already been hit with high rates of subprime foreclosure, it is not too late to benefit from this program. Below are three tips that can help you get your home loan refinanced:

Learn more details about how to qualify for HARP >>>
1. Understand What HARP Can Do for You

The first step in taking advantage of HARP is to understand what it is and how it could help you. In 2009, the Federal Housing Finance Agency created HARP to help homeowners who had very little or no equity refinance their home loans into more affordable options. Recently, HARP 2.0 made changes to the existing program to extend the term and give borrowers who have been unable to refinance by others means a chance to participate.

HARP 2.0 eliminated various fees, removed the 125 percent cap on loan-to-value ceilings for fixed-rate mortgages, eliminated the need for a new appraisal in most cases and made provisions to include second or vacation homes at different fee levels. The program is designed to help struggling borrowers with Fannie Mae loans and a demonstrated payment history find affordable ways to keep their homes.

2. Find Out If You Are Eligible for HARP

In order to participate in HARP, you must meet certain baseline requirements. To be eligible, your loan must be guaranteed or owned by Fannie Mae, and Fannie Mae must have bought the loan before May 31, 2009. You must not have refinanced under HARP before, unless that refinance took place between March and May of 2009.

The current loan-to-value on your loan must be greater than 80 percent, meaning you have less than 20 percent equity in your home. Most importantly, you must be current on your mortgage and have no late payments in the last six months and no more than one late payment in the last 12 months.
3. Select Arizona State Credit Union as Your Lender

Arizona State Credit Union is actively participating in HARP and is a great resource in securing program participation. The credit union offers various type of loans, including fixed-rate, adjustable-rate and jumbo loans. The idea behind HARP is to move your current loan into a more affordable and stable loan under HARP in order to make it easier to maintain your residence.


By refinancing with a new Arizona State Credit Union loan, you might be able to extend the term of your loan and lower your monthly payment amount, making it more affordable to stay in your home. This benefit has the added advantage of allowing you to wait for home prices to rise, should you ultimately wish to sell.

Arizona State Credit Union is a GOBankingRates client.

for more: http://www.gobankingrates.com/mortgage-rates/phoenix-arizona/3-tips-refinancing-fannie-mae-mortgage-under-harp-phoenix/

Bulk home buyers slowed by mortgage rules

Pity the owners of multiple homes in Metro Vancouver: it is getting tougher to find conventional residential financing once they own more than five properties in the world’s second-least affordable market..

“On Monday, another major bank pulled back their policies to only allow for five rental properties maximum, instead of having no limit to the number of rental properties. The move mirrors what most major banks are currently doing right now and leaves very few options for clients with multiple rental properties,” Vancouver mortgage broker Kyle Green of Mortgage Alliance stated in a memo to clients April 21.“It’s getting unbelievably hard to get investors financed, so be prepared to have more limited options if you fall into the five plus category.”

“It wasn’t too long ago that some of our clients were able to acquire 70 to 90 properties through major banks without too many issues,” Green told BIV this week. “Now, some are forced to take on joint venture partners or go to private lenders.”

Green said only two major lenders, Scotiabank and National, continue to lend on bulk residential investments “at competitive rates.”

The reason for the tighter regulations relates to recent restrictions on Canada Mortgage and Housing Corp. mortgage insurance for multiple residential properties, according to Green. He explained that residential mortgages are packaged into mortgage-backed securities that are then sold to investors. Investors, however, insist that all the mortgages be covered by insurance.

An option for those owning more than five rental properties would be to apply for commercial financing, which offers both lower mortgage rates and no cap on the amount of properties, or to finance properties with different lenders.

“We have several clients that hold between 40 to 100 individual rental condo units, and they typically spread these out between a variety of lenders,” said Bryan Dudley of Realtech Capital Group.

read more: http://www.biv.com/article/2015/4/bulk-home-buyers-slowed-mortgage-rules/

Justice Department sues Quicken over mortgages

New York • The Justice Department is suing Quicken Loans, saying the lender approved hundreds of mortgage loans that didn't meet federal standards, leaving the government stuck with the bill when borrowers defaulted.

The U.S. Department of Justice said Thursday that between September 2007 and December 2011, Quicken approved, underwrote, and certified the insurance of hundreds of mortgages that didn't meet federal guidelines.

It said Quicken encouraged its employees to disregard Federal Housing Administration rules and say that mortgages met the guidelines when they did not. Quicken sometimes asked appraisers to inflate the value of homes so it could approve the loans, and managers sometimes let underwriters break

The loans were insured by the U.S. Department of Housing and Urban Development, and Quicken filed for reimbursement when the loans defaulted. According to the Justice Department, HUD has already paid millions of dollars in claims on the loans Quicken underwrote, and there could be more claims coming.

In a statement, Quicken said the FHA's own reporting ranks it as the highest-quality large FHA lender — meaning it has the lowest default rate. It also said its FHA-backed mortgages make large profits for the government. The company described the lawsuit as "abusive" and the government's investigation as a "witch hunt."

Quicken sued the federal government Friday, saying it had done nothing wrong and that the government was trying to get it to admit wrongdoing and pay big penalties for political reasons. The company says it is the second-largest mortgage lender in the U.S. and the largest lender of loans guaranteed by the FHA. It says it was notified about a government investigation three years ago.

The Detroit-based company was a direct endorsement lender approved by the FHA, which meant FHA and HUD did not review the loans before the FHA insured them.

see more: http://www.sltrib.com/home/2436050-155/justice-department-sues-quicken-over-mortgages

Mortgage applications rise 2.3%, led by homebuyers

Buyers are returning to the housing market in ever growing numbers, as indicated by continued gains in loan applications to purchase a home.

Total mortgage application volume rose 2.3 percent week to week on a seasonally adjusted basis for the week ending April 17th, according to the Mortgage Bankers Association (MBA). The gain was driven largely by purchase applications, not refinances, even despite lower mortgage rates.

"Purchase applications increased for the fourth time in five weeks as we proceed further into the spring home buying season," said Mike Fratantoni, chief economist for the MBA. "Applications for FHA [government insured] purchase loans remained strong as well."

Mortgage applications to buy a home increased 5 percent from the previous week and are now 16 percent higher than the same week one year ago. Applications to refinance increased just one percent, but they are still up 41 percent from a year ago, when rates were considerably higher, around 4.25 percent.

A Bank of America branch in New York City.

Carlo Allegri | Reuters

A Bank of America branch in New York City.

Buyers are returning to the housing market in ever growing numbers, as indicated by continued gains in loan applications to purchase a home.

Total mortgage application volume rose 2.3 percent week to week on a seasonally adjusted basis for the week ending April 17th, according to the Mortgage Bankers Association (MBA). The gain was driven largely by purchase applications, not refinances, even despite lower mortgage rates.

"Purchase applications increased for the fourth time in five weeks as we proceed further into the spring home buying season," said Mike Fratantoni, chief economist for the MBA. "Applications for FHA [government insured] purchase loans remained strong as well."

Mortgage applications to buy a home increased 5 percent from the previous week and are now 16 percent higher than the same week one year ago. Applications to refinance increased just one percent, but they are still up 41 percent from a year ago, when rates were considerably higher, around 4.25 percent.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) last week decreased to 3.83 percent, its lowest level since January 2015, from 3.87 percent, with points decreasing to 0.32 from 0.38 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans, according to the MBA survey.

Rates haven't moved very much lately, which may be why homeowners have seen little incentive to refinance. 

read more: http://www.cnbc.com/id/102608013

Zero down, no fees: New mortgage program will help homebuyers rehabilitate Detroit homes

Detroit Mayor Mike Duggan announced Thursday a new mortgage program that he hopes will address one of the city’s great ironies: empty, abandoned houses everywhere that nobody can buy because they are so cheap and so broken that banks won't lend on them.

Last year, just 10 percent of Detroit homebuyers got a mortgage; the rest had to pay in cash to make deals happen.

The challenge? Most require significant work to be habitable, but the cost of fixing them up is often more than what they are valued. After all, the median home price in Detroit was just $26,000 in February, according to RealtyTrac, an Irvine, Calif.-based company that sells real estate data.

“We know that the desire to renovate these houses and rebuild our neighborhoods is there,” Duggan said at a news conference. “What we haven’t had is enough lenders willing to take a chance on our city to show what’s possible.”

The new program, dubbed the Detroit Neighborhood Initiative, enlisted Bank of America, Boston-based Neighborhood Assistance Corporation of America and Detroit-based Opportunity Resource Fund to create a loan that can get around federal regulations that prohibit, in most cases, lending more than a home is worth.

"Mortgage rules are formulaic," said Matt Elliot, Michigan market president for Bank of America. They don't consider extenuating market conditions like the ones that exist in Detroit.

"We can’t have a sustainable renaissance without Detroit’s neighborhoods. And we can only be as successful as Detroit is successful.”

The new program will write mortgages up to 110 percent of a home's value – or up to 150 percent if purchased through the Detroit Land Bank Authority home auctions. Additionally, the new loans offer favorable terms and are available to anyone who will live in the house and doesn't already own a property, including:

    0 percent down
    No closing costs
    No fees
    No maximum income
    Credit score is not considered
    Below market fixed rates (currently 3.5 percent for a 30-year loan and 2.875 percent for 15 year)
    Ability to buy down the interest rates to near 0 percent
    Loans of up to $200,000

“This is character-based lending,” said Bruce Marks, the founder and CEO of NACA, likening it to the VA loans that were made to vets after World War II. “It is a fully documented loan, but we look at income and ability to pay, not credit scores. … This is a model for restabilizing neighborhoods.”

NACA offers these types of mortgages in about 40 states and is funded by $10 billion from Bank of America and $3 billion from Citigroup Inc. However, it will only issue 150 percent loan-to-value mortgages in Detroit.

read more: http://www.crainsdetroit.com/article/20150416/BLOG017/150419875/zero-down-no-fees-new-mortgage-program-will-help-homebuyers

U.S. Mortgage Application Volume Falls

 The average number of mortgage applications for the week ended Friday fell 2.3% from the previous week, according to a survey by the Mortgage Bankers Association.

The seasonally adjusted purchase index, which a week earlier reached its highest level since July 2013, fell 3% in the most recent period. The unadjusted purchase index fell 2% from the previous week and was 7% higher than the year-ago period, the MBA said.

The refinance share of mortgage activity ticked up to 58% of total applications, from 57% the previous week.

The adjustable-rate mortgage share fell to 5.4% of total applications.

The average rate on 30-year, fixed-rate mortgages with conforming loans--with balances up to $417,000--rose to 3.87% from 3.86% the previous week.

Rates on 30-year, fixed-rate mortgages with jumbo-loan balances--more than $417,000--rose to 3.84% from 3.81% a week earlier.

The average rate for 30-year, fixed-rate mortgages backed by the Federal Housing Administration fell to 3.67% from 3.69%.

The average rate for 15-year, fixed-rate mortgages rose to 3.16% from 3.15% a week earlier.

Read more: http://www.nasdaq.com/article/us-mortgage-application-volume-falls-20150415-00241

Mortgages stay low as homebuying heats up

The rate on the most common mortgage was unchanged this week, while others slipped slightly. The low rates brought in more potential homebuyers and follow a disappointing jobs report, which may help delay an interest rate hike by the Federal Reserve.

"Rates are still low, and everyone is talking about the volume. It's been a busier spring-break week than we've had in years," says Pava Leyrer, chief operating officer for Northern Mortgage Services in Grand Rapids, Michigan. "People's jobs are secure or they have gotten raises. People feel they can afford something they couldn't before."
Time to buy

The volume of purchase mortgage applications was up 7 percent, after a 6 percent increase last week and a 5 percent increase the week before that, according to the Mortgage Bankers Association, or MBA, on April 8. Overall, the number of mortgage applications rose 0.4 percent, softened by a 3 percent decline in refinances.
Mortgage rates this week
2015%30-year fixedJanFebApr3.703.803.904.00
30 year fixed rate mortgage -- 3 month trend

    The benchmark 30-year fixed-rate mortgage was unchanged from the previous week, at 3.82 percent, according to the Bankrate.com national survey of large lenders. One year ago, that rate was 4.47 percent. Four weeks ago, it was 3.97 percent. The mortgages in this week's survey had an average total of 0.25 discount and origination points. Over the past 52 weeks, the 30-year fixed has averaged 4.13 percent. This week's rate is 0.31 percentage points lower than that 52-week average.
    The benchmark 15-year fixed-rate mortgage fell to 3.04 percent from 3.06 percent.
    The benchmark 5/1 adjustable-rate mortgage fell to 3.06 percent from 3.1 percent.
    The benchmark 30-year fixed-rate jumbo fell to 3.92 percent from 3.93 percent.


Read more: http://www.bankrate.com/finance/mortgages/mortgage-analysis-040915.aspxk

FICO testing score for unbanked

Are you saddled with a thin credit file? You don't have a credit report? No worries -- lenders soon may be able to score you anyway.

FICO, a major credit scoring company, says it's working on a new credit-scoring system for consumers with thin-to-no credit files.

The new score incorporates alternative data, including payment history on cell phone bills, cable bills, landline phone bills, and electric and gas bills to do so. It also uses property and public records data provided by LexisNexis.
Why should you care?

Under the traditional credit scoring system -- which requires consumers essentially to have loans to take on more loans -- approximately 50 million people don't have FICO Scores. The credit score's yet-to-be-named new version will cast a wider net, providing scores to an additional 15 million consumers, as first reported in The Wall Street Journal.

"FICO is trying to expand access to credit," Jim Wehmann, executive vice president of scores at FICO, said in an email. "This new score is an on-ramp to help people who don't have FICO Scores gain access to traditional forms of credit and begin building a credit history."
The rest of the story

The new score is currently being tested by 12 credit card issuers. FICO expects it to be generally available later in the year.

"People who gain access to credit through this alternative score will start building a credit history that can eventually help them receive a traditional FICO Score," Wehmann says, "In turn, this can help them pursue mortgages and auto loans."

FICO's not the only industry stalwart moving to improve the traditional credit scoring system. All three major credit bureaus -- Experian, Equifax and TransUnion -- have been experimenting and pushing for adding new data streams to credit post-Recession.

What type of information do you think should be factored into your credit score? Let us know in the comments below!

source: http://www.bankrate.com/financing/credit-cards/fico-testing-score-for-unbanked/

Mortgage rates little changed

Home mortgage-interest rates were little changed this week, with Freddie Mac’s survey showing lenders offering conventional 30-year loans at an average 3.7 percent, up from 3.69 percent last week.

As the spring homebuying season begins, rates are about where they started the year, said Len Keifer, deputy chief economist at Freddie Mac.

The average for 15-year fixed-rate mortgages was 2.98 percent, up from 2.97 percent a week ago, and the start rates for adjustable home loans were unchanged.

The survey asks lenders early each week about the terms they are offering to low-risk borrowers seeking mortgages of up to $417,000 that conform to the guidelines of Freddie Mac and Fannie Mae, the nation’s major housing-finance companies.

The borrowers would have paid a little more than half of 1 percent of the loan balance in upfront lender fees and discount points to obtain the best fixed rates. Payments for appraisals, title insurance and other third-party services are not included.

The survey provides a consistent gauge of mortgage trends, but actual rates fluctuate constantly and are influenced by many factors.

In addition to borrowers’ credit histories and debt loads, considerations include whether the borrowers opt for zero-cost loans at higher rates or pay extra to lenders initially to lower the rates.

see more: http://www.seattletimes.com/business/real-estate/mortgage-rates-little-changed/

30-Year Fixed Mortgage Rates Rise on Strong Economic Data; Current Rate is 3.62%, According to Zillow Mortgage Rate Ticker

SEATTLE, March 31, 2015 (GLOBE NEWSWIRE) -- The 30-year fixed mortgage rate on Zillow® Mortgages is currently 3.62 percent, up six basis points from this time last week. The 30-year fixed mortgage rate rose early in the week, then hovered around 3.65 percent before returning to the current rate on Tuesday.

"Rates increased last week on strong economic data from both the U.S. and Europe," said Erin Lantz, vice president of mortgages at Zillow. "This week we expect some volatility as markets hold their breath for Friday's monthly jobs report."

Zillow's real-time mortgage rates are based on thousands of custom mortgage quotes submitted daily to anonymous borrowers on the Zillow Mortgages site, and reflect the most recent changes in the market. These are not marketing rates, or a weekly survey.

The rate for a 15-year fixed home loan is currently 2.87 percent, while the rate for a 5-1 adjustable-rate mortgage (ARM) is 2.75 percent.

Purchase Mortgage Application Activity

Zillow predicts tomorrow's seasonally adjusted Mortgage Bankers Association Weekly Application Index will show purchase loan activity decreased by 1 percent from the week prior. Zillow combines loan requests made on Zillow Mortgages last week with the previous week's Mortgage Bankers Association (MBA) Weekly Application Index to predict the MBA's Weekly Application Index for purchase loans, which will be released tomorrow. For more information about this prediction, visit http://www.zillow.com/research/mortgage-app-index-part-one-7016/.        

Below are current rates for 30-year fixed mortgages by state. Additional states' rates are available at: http://www.zillow.com/mortgage-rates.

read more http://globenewswire.com/news-release/2015/03/31/720808/10127100/en/30-Year-Fixed-Mortgage-Rates-Rise-on-Strong-Economic-Data-Current-Rate-is-3-62-According-to-Zillow-Mortgage-Rate-Ticker.html

Tips on scoring the best rate on a home loan

Mortgage interest rates have hovered near historic lows in recent years, but change may be on the horizon.

The Federal Reserve is considering increasing the short-term interest rate it controls as early as June. That could send mortgage rates moving higher again.

For now, rates remain homebuyer-friendly. The national average rate for a 30-year, fixed mortgage fell to 3.75 percent recently. It was 4.28 percent a year ago.

That’s good news for homebuyers, who despite signs that the economy is recovering, are always looking for ways to save.

Still, landing the most affordable mortgage depends on more than getting the lowest rate. The rate borrowers qualify for hinges on several factors, including their finances, credit score and the size of the down payment they’re prepared to make. And the type of loan and the fees that come with it also determine the overall cost of a mortgage.

“As rates go up it will affect affordability,” said Greg McBride, chief financial analyst at Bankrate.com. “But rate is not going to be your only loan consideration. You don’t buy a house because of low interest rates any more than you get married because of a sale at the bridal shop.”

Here are some tips on how to get the best deal on a mortgage:

Size up your credit: Mortgage lenders consider three key factors to determine what rate they can offer a borrower: Good credit, proof of income and size of the down payment. Strength in one category can offset a deficiency in another, but having a FICO score of 740 or better out of 850 will generally qualify borrowers for the lowest mortgage rate.

You can qualify for a home loan with a lower credit score, but you’ll pay a higher interest rate.

If your FICO is below 740, review copies of your credit files for errors that may be weighing down your score. Consumers are entitled to a free credit report every 12 months from the three major credit-reporting firms — Equifax, TransUnion and Experian. Go to Annualcreditreport.com.

The credit firms are required to respond to error disputes within 30 days, so it pays to do this well in advance of when you intend to buy a home. Think at least six to eight weeks.

The ratio between available credit and how much debt you’re carrying is another key element of the FICO score. A good rule of thumb is to keep debt at less than half of your available credit. Reducing that ratio alone can often bump up your score.

Shop around: Before you begin your home search, ask a lender to assess how much you can borrow. The lender will conduct a thorough credit and income review and issue you a pre-approval letter, which will give a seller solid indication of what you can spend.

see more: http://www.detroitnews.com/story/business/real-estate/2015/03/30/tips-scoring-best-rate-home-loan/70639372/