The rate of mortgage loans in forbearance dropped again this week, signaling a continued improvement in those numbers, albeit one that is slowing down amid signs of a potential increase. The mortgage forbearance rate “decreased by 1 basis point from 3.48% of servicers’ portfolio volume in the prior week to 3.47% as of July 25, 2021,” the Mortgage Bankers Association said in its weekly Monday forbearance report. Though the week-over-week numbers were encouraging, MBA Senior Vice President and Chief Economist Mike Fratantoni warned in the report that the trendline is not entirely encouraging. “Forbearance exits remained low, and there was another increase in new forbearance requests, particularly for Ginnie Mae and portfolio and PLS loans,” he said. “The net result…
Mortgage rates are unlikely to rise in the very near future, potentially fueling further home purchases throughout the summer as buyers look to cash in on the ongoing rate slump. Though rates are “likely to rise in the following months, buyers shouldn’t “expect any sharp spikes in August,” National Association of Realtors senior economist Nadia Evangelou told Bankrate this week. “I expect mortgage rates to show little change in August, hovering around 3 percent as most economic indicators will start to normalize,” she added. Atlanta-area real estate attorney Chuck Biskobing agreed. ““I expect rates to more or less hold steady for the next month in the 3 percent range for a 30-year mortgage,” he said, arguing that “recent unexpectedly high…
Overall pending home sales dipped last month in the U.S., the latest of several signs that the housing market is potentially cooling down after more than a year of nonstop frenzy. Pending sales “decreased 1.9% in June from the prior month and from one year ago,” the National Association of Realtors said in a Thursday press release. The decline was not nationally uniform month-over-month; signings “rose in the Northeast and Midwest but fell in the South and West,” the association said. Year-over-year the drop was more pronounced, where “only the Northeast region saw an increase in contract signings.” “Pending sales have seesawed since January, indicating a turning point for the market,” NAR Chief Economist Lawrence Yun said in the release.…
The 15-year fixed mortgage rate hit a record low this week while the 30-year fixed rate remained at an also-low but mostly stable level. The 30-year rate “averaged 2.80 percent with an average 0.7 point for the week ending July 29, 2021, up from last week when it averaged 2.78 percent,” Freddie Mac said in its weekly rate press release. The 15-year rate, meanwhile, “averaged 2.10 percent with an average 0.7 point, down from last week when it averaged 2.12 percent,” a level which Freddie Mac Chief Economist Sam Khater said was a “record low.” Khater in the release said that the 30-year rate was “below three percent for the fifth consecutive week,” which he said was “largely due to…
Banks are selling a new type of bond that is allowing them to distribute risk among investors and more effectively cover potential losses from defaults. The “risk-transfer securities” are “backed by short-term loans the bank makes to mortgage lenders,” the Wall Street Journal reports. In the case of borrower default, “the investors in the bonds effectively cover the loss.” The bond is reportedly “a niche product,” the Journal reports, one that is “supported by a surging housing market and a recovery that has improved borrowers’ credit quality,” undercutting fears of risky lending practices and unstable securities that marked the 2008 financial crisis. “People want exposure to housing and consumer markets that are performing,” JPMorgan analyst Kaustub Samant told the paper.…
The number of mortgage applications in the U.S. jumped this week after a brief decline last week, amid signs of a broader modest downward trend in housing market activity. Mortgage applications “increased 5.7 percent from one week earlier,” the Mortgage Bankers Association said on Wednesday, drawing data from its Weekly Mortgage Applications Survey. The increase represents a reversal from last week’s numbers, which indicated a decline in week-over-week mortgage applications. The overall trend, meanwhile, is one of cooling off after well over a year of an unrelenting real estate market throughout the country. Year-over-year mortgage applications last month fell by nearly 24 percent. Construction permits for new housing were also lately down; mortgage credit availability has also declined, a sign…
A recent report by realty company Redfin shows that buyers from outside a housing market are often responsible for driving housing prices even higher in the area to which they’re moving. Out-of-towners “tend to be able to pay more than locals in popular migration destinations because they’re often relocating from more expensive areas,” the company said in its report. The company analyzed several locations from which it drew its data, including Austin, Texas, where outside home purchasers were markedly higher than in-town ones: The typical home purchased by out-of-towners in Austin sells for $470,000, versus $447,500 for locals. Out-of-towners also tend to buy homes that are priced higher from the beginning: The typical list price for a home purchased by out-of-towners is…
The Fair Housing Finance Agency House Price Index (FHFA HPI®) rose 1.7 percent in May, sending the annual price increase to 18 percent. The previously reported 1.8 percent price change for April 2021 was unrevised. “House prices continued their record-setting growth into May,” said Dr. Lynn Fisher, FHFA’s Deputy Director of the Division of Research and Statistics. “This trend will likely continue around the country as busy summer homebuying months maintain the pressure being felt in already tight housing markets.” The increase in home prices was not evenly distributed across the country. Among the nine census divisions, the Pacific enjoyed the highest monthly price spike (2.4 percent), while prices rose least in the Middle Atlantic division (1 percent). The 12-month…
Having to make mortgage and rent payments was linked to lower health outcomes in the early stages of the pandemic, according to new research out of the University of Michigan. The study found that “during the early months of the COVID-19 pandemic, having to make rent or mortgage payments was significantly associated with health and mental distress,” the university said in a press release. The researchers found that “compared to those without mortgage debt, homeowners with mortgage debt and renters reported worse self-rated health and higher levels of mental distress” in the earliest months of the SARS-Cov-2 crisis in the U.S. “We know housing is a social determinant of health,” said lead study researcher Roshanak Mehdipanah. “We need to invest…
The share of U.S. mortgages in forbearance declined over the past week, signaling an ongoing steady improvement in those numbers, although the rate of decline slowed slightly over earlier weeks. The number of mortgages in forbearance declined “by 2 basis points from 3.50% of servicers’ portfolio volume in the prior week to 3.48% as of July 18,” the Mortgage Bankers Association said in a Monday press release. “As is typical for mid-month reporting, forbearance exits slowed, and there was a slight increase in new requests,” MBA Senior Vice President and Chief Economist Mike Fratantoni said in the release. “The net result was a small drop in the share of loans in forbearance – the 21st consecutive week of declines.” The…
