Category Archives: Nonconforming

N.Y. High Court Weighs Reopening of Door to Mortgage Claims

Print

Email

Reprints

Comment

Twitter

LinkedIn

Facebook

Google+

New York law gives investors who say they were duped into buying flawed mortgage bonds six years to sue. But does the clock start ticking on the day the bonds were packaged or after problems with the loans came to light?

On Thursday, New York’s highest court confronted that question as it considered an appeal by investors seeking to force a Deutsche Bank AG unit to buy back bad loans packaged into securities before the financial crisis. The eventual ruling by the state Court of Appeals could open the door to many more such cases if the investors’ trustee prevails.

Paul Clement, a lawyer for the trustee, told the court that the six-year statute of limitations begins to run only after the flaws are discovered — and not, as the bank argued, when the bonds were packaged and sold years earlier.

“This is a contract that extends for 30 years,” Clement said, referring to a legal agreement related to the bonds. “It would be odd for investors to put themselves in a position where they would be unprotected for the last 24 years.”

Not so, said David Woll, a lawyer for DB Structured Products, which provided the mortgages packaged into bonds in 2006. He told the court that reviving the lawsuit would “change what’s been the law for a century” regarding such contracts.

“We could be here in 2042” if the court adopts the investors’ interpretation of the time limits, he told the panel, which was convening for the day in White Plains, N.Y.

The lawsuit over losses of more than $330 million on nonperforming loans has divided lower-court judges. DB Structured won a dismissal of the case in 2013 after an appeals court determined the six-year period began to run when the deal closed.

A four-judge appellate panel unanimously reversed a decision by a Manhattan trial judge who found that the clock began when DB Structured failed to cure or repurchase defective loans in a timely manner. The Court of Appeals then agreed to hear the case.

Pools of home loans securitized into bonds were a central part of the housing bubble that helped send the U.S. into the biggest recession since the 1930s. The housing market collapsed and the crisis swept up lenders and investment banks as the market for the securities evaporated.

Investors sued DB Structured in March 2012 seeking more than $250 million in damages. According to the complaint, the company breached its obligations to repurchase loans in a pool of more than 8,000 that didn’t conform with statements about their characteristics and quality. A trustee, HSBC Bank USA, later replaced the investors in the suit.

The loans were bought by DB Structured from at least three originators and sold to Ace Securities Corp., another unit of Deutsche Bank. It then deposited the loans into the trust, according to the suit, and the loans were securitized through the issuance of more than $500 million of certificates under a pooling and servicing agreement.

The trust had more than $330 million in losses on nonperforming loans by September 2012, according to a court filing.

Article source: http://www.nationalmortgagenews.com/news/secondary/ny-high-court-weighs-reopening-of-door-to-mortgage-claims-1049994-1.html

Federal Regulators Issue Final Appraisal Rule

Print

Email

Reprints

Comment

Twitter

LinkedIn

Facebook

Google+

WASHINGTON — Federal banking regulators are putting pressure on a dozen or more states to begin regulating appraisal management companies within their borders.

Under a final rule issued Thursday afternoon, states are encouraged to register and supervise appraisal management companies that contract with licensed and certified appraisers that perform appraisal assignments for banks and other lenders. But such companies that are not associated with a federally regulated institution will be handicapped if a state takes a hands-off approach.

“In states that have not established a regulatory structure after 36 months from the effective date of this final rule, any non-federally regulated AMC is barred by section 1124 of Title XI from providing appraisal management services for federally related transactions,” the regulators said.

Mortgage loans originated by a federally insured bank, thrift or credit unions are considered federally related transactions.

As previously reported, 37 states already meet the minimum requirements for state registration and supervision of AMCs.

Six federal regulatory agencies issued the joint final AMC rule that is slated to go into effect 60 days after is it published in the Federal Register.

The Appraisal Institute did not respond to requests for comment in time for this story.

Article source: http://www.nationalmortgagenews.com/news/regulation/federal-regulators-issue-final-appraisal-rule-1049998-1.html

HarborOne Bank Invests in New England Mortgage Lender

Print

Email

Reprints

Comment

Twitter

LinkedIn

Facebook

Google+

HarborOne Bank announced Wednesday that it will acquire Merrimack Mortgage Co. Terms of the transaction are undisclosed.

The deal will allow HarborOne to focus on growing its banking foothold in key New England lending markets, while bringing in mortgage fee income and creating additional opportunities for the region. It is a $2 billion-asset company based in Brockton, Mass., and the largest co-operative bank in New England.

Merrimack will become a wholly owned subsidiary of HarborOne. The privately held home loan originator based in Manchester, N.H., does more than $1 billion in business on average annually across New England.

Merrimack principals will assume executive leadership positions at the subsidiary mortgage unit; Dan McKenney will become president and CEO and Timothy Boyle executive vice president and CFO.

The deal is expected to close in July.

Article source: http://www.nationalmortgagenews.com/news/origination/harborone-bank-invests-in-new-england-mortgage-lender-1049888-1.html

New York State Proposes New Rules on Title Insurance Companies

Print

Email

Reprints

Comment

Twitter

LinkedIn

Facebook

Google+

New York Gov. Andrew Cuomo and New York Superintendent of Financial Services Benjamin Lawsky today proposed new regulations for the title insurance industry, including restrictions on meal and entertainment expenses.

Cuomo and Lawsky argued that “kickbacks and other improper expenditures” within the industry drive the cost of title insurance unnecessarily higher for consumers. In a press release, the two said the rules would prohibit the currying of favor through direct or indirectly given meals and gifts in exchange for title insurance business. The rules would also impose caps on ancillary title insurance charges.

“New Yorkers should not have to foot the bill for outrageous or improper expenses made by title companies just to refinance or close on their home,” Cuomo said in a release. “Our administration will not stand for that kind of abuse in the title insurance industry, and these new regulations will help ensure that New Yorkers are protected from unfair charges and get the most bang for their buck.”

To enforce the above proposed rules, the governor and superintendent will also seek to require filings by title insurance companies once every three years to demonstrate that rates comply with state insurance law, and are not excessive, inadequate, or discriminatory.

“The New York State Land Title Association has been working cooperatively with the New York State Department of Financial Services (NYSDFS) to ensure that consumers are protected from unscrupulous actions, receive the benefits of greater transparency and work within an appropriate regulatory structure,” said New York State Land Title Association president Rafael Castellanos in an emailed statement. “In 2014, the Association provided important feedback on legislation establishing the licensing of title agents, and intend to provide valuable input on today’s proposed regulations.” .

In the release announcing these proposed rules, Cuomo and Lawsky say that a New York Department of Financial Services investigation into the title insurance industry found inducement arrangements to be common and expensive to consumers. The governor’s office and NYDFS claim that they could raise premiums for consumers by as much as 60%, depending on the type of transaction insured.

Article source: http://www.nationalmortgagenews.com/news/regulation/new-york-state-proposes-new-rules-on-title-insurance-companies-1049881-1.html

D.R. Horton to Buy Pacific Ridge Homes

Print

Email

Reprints

Comment

Twitter

LinkedIn

Facebook

Google+

D.R. Horton Inc. agreed to buy the homebuilding operations of Seattle-based Pacific Ridge Homes for about $72 million in cash to expand in the U.S. Northwest.

The purchase includes about 350 lots, 90 homes in inventory and 40 homes in order backlog, Fort Worth, Texas-based D.R. Horton said in a statement Monday. The company also acquired control of about 400 lots through option contracts.

Pacific Ridge will operate as a separate division within D.R. Horton, and co-owner Justin Goff will be its president, according to the statement.

“Pacific Ridge has an excellent reputation for quality and service,” D.R. Horton Chairman Donald R. Horton said in the statement. “Their well-established building operations make Pacific Ridge a great fit for D.R. Horton as we look forward to expanding our presence in the greater Seattle area.”

D.R. Horton, the biggest U.S. homebuilder, operates in 29 states. The company completed sales of 32,504 homes in the year through March, according to the statement. Pacific Ridge sold 182 homes in the period at an average price of $436,000.

Article source: http://www.nationalmortgagenews.com/news/origination/dr-horton-to-buy-pacific-ridge-homes-1049707-1.html

Refis Surge, But Bankers More Buoyant About Home Purchases

Print

Email

Reprints

Comment

Twitter

LinkedIn

Facebook

Google+

Home lending at most large and regional banks soared in the first quarter and loan pipelines are bulging heading into the second quarter, early signs that 2015 could be a strong year for the housing market.

Falling interest rates in January and February sparked a flurry of refinancing activity, while home buying finally picked up steam in March, the start of the spring selling season. With low rates tempting more home owners to refinance and relaxed down payment requirements spurring more home sales, bankers are more optimistic about mortgage lending than they have been in some time.

“All the metrics that we are following in the mortgage business are positive at the moment,” Grayson Hall, the chief executive at Regions Financial, said on an April 21 conference call with analysts. “We, like most people, anticipate a very strong second and third quarter.”

To be sure, the first quarter’s strong results compare with depressed volumes a year ago, when rates for 30-year loans had climbed above 4.3%. Compared with the first quarter of 2013 the peak of the refi boom loan volume is down 50%.

Still, the mortgage market is clearly rebounding, and it’s not just refi activity that’s driving demand. Even with mortgage rates sitting well below 4%, refinancings dropped to 56% of total applications for the week that ended April 22, the lowest level since October, according to the Mortgage Bankers Association.

Mike Fratantoni, the MBA’s chief economist, said that the purchase market has been aided by the introduction of 3% down payment loans by Fannie Mae in December and Freddie Mac in March. Lower down payment requirements for jumbo loans also have helped boost lending.

“We’re at an inflection point where refinances are getting some lift and purchase volume is doing really well,” said Marty Mosby, director of bank and equity strategies at Vining Sparks in Memphis.

Wells Fargo, the largest home lender and the industry’s bellwether, said that its mortgage volume in the first quarter jumped 36% year over year,to $49 billion. More encouraging, Wells had $44 billion of loans in its pipeline when the quarter ended March 31.

Loan volume jumped 45% at JPMorgan Chase, to $24.7 billion, 54% at Bank of America, to $13.7 billion, and 76% at U.S. Bank, to $10.9 billion. Among regional banks, residential lending volume jumped 37% at PNC Financial Services, 27% at MT Bank, 64% at SunTrust Banks and 32% at Regions.

BBT said that its refinance volume was 55% in the first quarter while purchase volume was 45%, a more balanced mix than in the past few quarters. Other banks are seeing similar shifts, an indication that many borrowers eligible to refinance their home loans have already done so.

“We think the second quarter will be strong with the purchase market showing some traction, but from an overall volume standpoint, purchase doesn’t solve the drop in refinances,” said Bose George, a KBW analyst.

Nancy Bush, a manager at NAB Research LLC in Madison, Ga., noted, however, that some banks’ numbers are skewed by the fact that they are buying loan portfolios from correspondent lenders. The cost of buying those loans, rather than originating them through retail branches, can thin banks’ margins, she added.

The first quarter is typically the weakest for mortgages but increased refinance activity drove strong mortgage fees. With interest rates low, gain on sale margins are at their highest levels in six quarters.

Another clear sign that momentum is building: Wells’ loan application volume increased 41% between Dec. 31 and March 31, to $93 billion, according to Keefe Bruyette Woods.

Activity has been particularly brisk in Florida, one of states hardest hit by the housing bust.

“Florida is back,” Ricky Brown, BBT’s president of community banking, told analysts on an April 21 call. “They are buying homes particularly in South Florida.”

John Stumpf, Wells’ chairman and CEO, echoed those comments.

“I was in Miami recently and that market, it’s stunning how that market is really doing so well,” Stumpf said on a conference call with analysts. “You would have looked back six years ago and you couldn’t imagine what’s going on today.”

To be sure,Floridahas not fully recovered from the downturn. While home prices are rising faster there than in most states, they are still 32.4% below their 2006 peak, according to data from CoreLogic. Also, Floridastill had the second-highest share of distressed home sales at 22.3% in January, trailing only Michigan’s 23.1%, CoreLogic data showed.

There is concern that new mortgage disclosure rules that take effect Aug. 1 could put a damper on lending in the second half, just as the qualified mortgage rule did the same a year ago.

Paul Miller, an analyst at FBR Capital Markets, said, some lenders are worried that they will not have computer systems aligned properly ahead of the disclosure rules, which combine requirements of the Truth-in-Lending Act and the Real Estate Settlement Procedures Act. In the long run he sees the new rule as being good for banks, but the transition period could be rough, he warned.

“You’re going to see a huge run-up in originations up to July but after that, it could be disruptive,” Miller said. “People were afraid of QM and they tightened up the credit box. The industry will be much better off when everything is done but it will have a magnified effect.”

Article source: http://www.nationalmortgagenews.com/news/origination/refis-surge-but-bankers-more-buoyant-about-home-purchases-1049730-1.html

People Movers of the Week: April 24

Print

Email

Reprints

Comment

Twitter

LinkedIn

Facebook

Google+

MARYLAND

BETHESDA

Walker Dunlop Inc. promoted executive vice president and chief operating officer Howard Smith to president.

Smith has been with the company for 34 years, holding a number of different roles, most recently that of chief operating officer.

As president, he will be responsible for all loan origination activities of the company and will continue to serve on the Walker Dunlop board.

NEW JERSEY

ISELIN

REMN Wholesale hired Damon Richardson in the newly created role of renovation lending specialist.

One of Richardson’s main duties with REMN will be educating brokers across the country on how they can utilize renovation mortgages to their advantage.

In addition to face-to-face training seminars and events, he will manage REMN Wholesale’s weekly renovation lending webinar programs, designed to educate brokers and mortgage loan originators on how to promote and better understand the current renovation mortgage products on the market today.

PARAMUS

Urban Edge Properties appointed Herbert Eilberg to the position of chief investment officer.

Eilberg was previously senior vice president, acquisitions at Acadia Realty Trust, where he served as a member of the acquisitions team and was responsible for sourcing, underwriting and closing core and value-add investments.

Before joining Acadia, he worked in the real estate acquisition departments of The Milestone Group, Perry Capital and Soros Real Estate Partners.

NEW YORK

NEW YORK

Steve Cho has joined Greystone as a managing director.

In his new role, Cho will focus on building Greystone’s CMBS presence in the Central states through Texas.

Cho brings to Greystone over 17 years of real estate experience in CMBS originations, distressed loan restructurings and dispositions, and private equity acquisitions.

Just prior to joining Greystone, he was a managing director at Royal Bank of Scotland and the sole CMBS originator in the Central region.

OHIO

CLEVELAND

Safeguard Properties promoted Michael Greenbaum to chief operating officer.

Greenbaum, who had previously served as vice president of operations, joined Safeguard in 2010.

Before joining Safeguard, he held senior management and executive positions with Erico, Accel Inc. and McMaster-Carr, and served in the U.S. Army, Ordinance Branch, specializing in supply chain management.

PENNSYLVANIA

TREVOSE

LoanLogics has hired David O’Malley as director of loan quality solutions.

As director of loan quality solutions, he will help to guide the product roadmap, as well as spearhead and manage the technology evaluation stage of the sales process.

Prior to joining LoanLogics, O’Malley served as director of business development for quality assurance and quality control for Kroll Factual Data and was responsible for expanding the company’s market share.

Prior to assuming his responsibilities at Kroll in 2012, he served as president of ACES Risk Management Corp., where he worked for 20 years.

Are you a mortgage professional who recently changed jobs? Let us know! Send your announcement and photo (if available) to Glenn McCullom at glenn.mccullom@sourcemedia.com.

Article source: http://www.nationalmortgagenews.com/news/people/people-movers-of-the-week-april-24-1049553-1.html

Atlantic County, N.J., Foreclosure Rate a Credit Negative, Moody’s Says

Print

Email

Reprints

Comment

Twitter

LinkedIn

Facebook

Google+

Increasing foreclosure levels in Atlantic County, N.J., are a credit negative for the government, hit hard by Atlantic City’s recent casino struggles, according to Moody’s Investors Service.

A RealtyTrac report found that Atlantic County had the highest foreclosure rate in the nation during the first quarter.

Foreclosures in Atlantic County, which is rated Aa2 with a negative outlook by Moody’s, rose 80% in March over the previous month and were 168% higher than the same period last year, according to the RealtyTrac data. One out of every 252 homes in the county were in foreclosure during March, almost double New Jersey’s average and well-above the U.S. rate of one in 1,092.

“The increased foreclosures will suppress property tax collections for municipalities and be a drag on future tax base growth in the county,” said Moody’s analyst David Strungis in an April 23 report. “The recent collapse of the casino and gaming industry in Atlantic City brought about the increased foreclosures.”

Strungis noted that Atlantic County’s tax base contracted significantly between 2008 and 2014, falling 45% in that period with another 38% decline expected by 2016. Four of Atlantic City’s 12 casinos closed in 2014. Moody’s downgraded Atlantic City six notches to Caa1 in late January after the state appointed an emergency manager to oversee its finances, which include a $101 million budget gap in 2015.

New Jersey, which is rated A2 with a negative outlook, had the second highest backlog of foreclosures behind only Florida during the first quarter due to a “judicial” process that Strungis said has hindered the state’s housing recovery. He said the same challenges will likely face Atlantic County on a more local level.

“Over the next year, the high level of foreclosures will suppress property values and hurt property tax collections, particularly for the county’s municipalities,” said Strungis.

“Although the municipalities could implement a tax lien sale on a foreclosed property, there is no guarantee that there will be sufficient bidders to purchase the lien and the economic distress in Atlantic City may keep potential buyers away, forcing municipalities to carry tax liens for multiple years.”

Strungis noted that Atlantic County is “insulated from the immediate shocks of tax base declines” because its municipalities bear the risk of any tax delinquencies due to guaranteeing the county’s tax collections in full.

Article source: http://www.nationalmortgagenews.com/news/distressed/atlantic-county-nj-foreclosure-rate-a-credit-negative-moodys-says-1049567-1.html

Sales of New Homes Slumped in March from Seven-Year High

Print

Email

Reprints

Comment

Twitter

LinkedIn

Facebook

Google+

Purchases of new homes slumped more than forecast in March from a seven-year high, a sign progress in the industry will be halting.

Sales dropped 11.4% to a four-month low 481,000 annualized pace, Commerce Department figures showed Thursday in Washington. The median estimate of 79 economists surveyed by Bloomberg called for a 515,000 rate.

Support for the housing market coming from better job growth and low mortgage rates is being countered by a limited supply of available homes and still-tight lending standards, creating a situation where improvement in the industry may be fitful in the months ahead. Stronger income growth for American households will be needed to further buttress the market.

“We’re recovering from the biggest housing crash really in the history of the country, so this is going to take time to work out,” Jay Morelock, an economist at FTN Financial in New York, said before the report.

Last month’s drop was the biggest since July 2013. The Commerce Department revised the February reading up to 543,000, the highest since February 2008. Figures for December and January were also stronger than previously estimated.

Economists’ estimates in the Bloomberg survey ranged from a sales rate of 450,000 to 550,000 after a previously reported 539,000 in February.

Another report Thursday showed applications for unemployment benefits held below 300,000 for the seventh straight week, pointing to a rebound in payrolls after hiring eased last month.

Jobless claims increased by 1,000 to 295,000 in the week ended April 18, according to data from the Labor Department. The figures correspond to the week the government surveys employers to calculate the monthly payroll data, indicating hiring probably firmed in April.

The Commerce Department’s report showed new-home purchases were 17.4% higher in March than the same period in 2014 on an unadjusted basis, today’s report showed. The median price of a new home decreased 1.7% last month from a year ago to $277,400.

The price could have been affected by a change in the regional mix of sales with purchases falling in three of four areas in March. Sales slumped 33.3% in the Northeast, which typically is among the areas with higher-priced properties. Demand dropped 15.8% in the South, the biggest decline since July 2013, and fell 3.4% in the West. The Midwest showed a 5.9% gain.

Sales of new properties, which are tallied when purchase contracts are signed, are considered a more timely measure of the market than sales of previously owned dwellings, which are counted when a sale is final.

Purchases of those homes climbed 6.1% to a 5.19 million annualized rate, the best since September 2013, figures from the National Association of Realtors showed Wednesday. Prices rose by the most in more than a year.

Home-value appreciation is being fueled by a constricted inventory of homes available to potential buyers. Existing homes stayed on the market a median 52 days last month, the fewest since July, according to the Realtors group, while 40% of homes sold in March were on the market for less than a month.

That creates a tough situation for first-time buyers, who are often more price-sensitive. DR Horton Inc., a Fort Worth, Texas-based builder, is trying to cater to such households through its Express Homes brand, whose homes had an average closing price of $179,000 in the three months ended March 31.

“When we put the product out there at an affordable price for those entry-level buyers and in the current mortgage environment, there is plenty of demand,” Chief Financial Officer Bill Wheat said on a Wednesday earnings call. “We think that any limitations on the entry-level buyer is supply driven.”

Stronger job growth may help demand rebound. Payrolls have grown by about 590,000 workers in the first three months of 2015, beating the 579,000 added by the same point last year, when employment grew by 3.1 million, the most since 1999.

At the same time, mortgage rates remain low, making home buying a more affordable option for some households. The average rate for a 30-year fixed mortgage was 3.67% in the week ended April 16, according to Freddie Mac. The rate was 3.59% in February, the lowest in almost two years.

That may make buying a home a little easier for Americans who are seeing stagnant wage growth. Average hourly earnings climbed 2.1% in the year ended March, in line with the average throughout the recovery and less than the 3% to 4% increases that Federal Reserve Chair Janet Yellen has indicated is more normal.

“Until we get much stronger wage growth, we’re not going to get a housing market that takes off,” said Ryan Sweet, a senior economist at Moodys Analytics Inc. in West Chester, Pa.

Still, homebuilders seem optimistic about the outlook for their industry. The National Association of Home Builders/Wells Fargo sentiment gauge rose in April to a three-month high amid improved buyer traffic and a better sales outlook. More favorable weather may also help the housing industry, as buyer traffic picks up in the spring selling season.

New-home sales volumes typically peak in March and gradually trail off through the year, according to Bloomberg Intelligence analyst Drew Reading.

“Recent macroeconomic and industry data suggests a more robust spring selling season and overall 2015 for public homebuilders,” he wrote in April 20 research. “Key macro drivers such as interest rates, job growth, household formations and mortgage applications are all improving.”

Article source: http://www.nationalmortgagenews.com/news/origination/sales-of-new-homes-slumped-in-march-from-seven-year-high-1049458-1.html

Consumers Need to Get Real About Rates: Redfin Economist

Print

Email

Reprints

Comment

Twitter

LinkedIn

Facebook

Google+

Millennials and others who are worried about interest rate increases from the current near-record lows need a reality check.

“People still bought homes when rates were at 18% in 1981,” Nela Richardson, the chief economist for real estate brokerage Redfin, said at the SourceMedia Mortgage Servicing Conference Wednesday in Dallas. “Homebuyers are pretty myopic. They want the best rate possible. They want the rate their neighbor got three months ago.”

There is a school of thought that rising interest rates will motivate those who are sitting on the sidelines to get motivated and get back into the market.

“I think buying a house is like having kids; there is never a perfect time,” but some people might need an incentive and there is no bigger incentive than the threat of higher home-financing costs, she said.

Even if the Fed raises short-term rates, Richardson thinks rates for the 30-year, fixed-rate mortgage will not go much higher than 4% for 2015 and will stay under 5% in 2016.

Housing was supposed to pull the U.S. out of its funk, and that is why the Federal Reserve kept rates low. The view was with low rates builders would build and buyers would buy.

And even now it is still hard to get builders to build and buyers to buy, the “most basic functions” of the housing market, Richardson said. So when we think about what is next for housing, “there’s a lot going on but there is still a lot left to do.”

The economy has been improving, but it is the slow pace of that improvement that is worrisome. There had been a 12-month stretch of the economy posting more than 200,000 new jobs per month, but in March that streak was broken.

Potential homebuyers do not like that. “When they see numbers like that, they get a little jittery,” Richardson said.

Even lower prices at the gas pump have not motivated more spending. Consumers have been pocketing the savings and not spending it at the mall, holding down gross domestic product growth.

The strong dollar hurts exports, and that also affects GDP growth.

However, “consumers continue to be confident,” Richardson said. “The oil price decline may not have made them spend more, but at least it made them feel better about their spending, so that’s an improvement.”

Wages have not kept up with even the minimal amount of inflation, and that affects current homeowners and their ability to keep up with tax increases and potential buyers and their ability to keep pace with price increases.

Another concern for the housing market is student loan debt, but this is not just a millennial issue, she said. Their parents may have refinanced a mortgage to help pay for their education. Those families may have lost equity in their home and cannot trade up or down into another property.

But challenges remain. For a long time housing has been driven by what happened in the macroeconomy. Now consumers are more driven by what is happening in their local economy.

The one thing that has been really consistent since the start of 2015 is “buyer demand has been off the charts,” Richardson said.

She gave an anecdote about a Redfin agent from Boston who conducted an open house this winter even as the record snowfall was still on the streets. It drew 100 people, and the police had to shut it down because of the commotion.

Cash “is no longer king” in home purchases as traditional buyers are replacing investors. But in some hot markets, cash remains important. Competitiveness of the market is driving up prices, and there is a worry that the appraisal won’t reach that value. So they are demanding down payments as high as 30% to 50%.

Others are doing short-term loans from friends and family to buy the home and then turning around and getting a mortgage, Richardson said.

So while 2015 could be the biggest year in housing since the bust, several variables including rising interest rates and the lack of inventory could derail everything. The number of homes for sale shrunk in March for the first time since September 2013.

While much of the discussion has been about how the economy affects homebuyers, little has been mentioned about how it affects sellers.

Among the likely reasons for the shortage is that many potential sellers are still in negative equity even as home values have risen in recent years. Even for those whose values have recovered, they have not reached a 20% level of equity yet, leaving them with little cash to put down on a house, Richardson said.

Even if someone is “downsizing” to a smaller property, that property could cost as much or more than their current home, she noted.

Article source: http://www.nationalmortgagenews.com/news/servicing/consumers-need-to-get-real-about-rates-redfin-economist-1049491-1.html

WP Facebook Auto Publish Powered By : XYZScripts.com
Bunk Beds