Fannie Launches the First look Program

Fannies supply of foreclosed homes keeps growing. The First Look program is designed to help owner occupants buy homes. Its a new program aimed at toward stabilizing neighborhoods and building stronger communities in tough times. The idea is to give the owner occupant an advantage over the investor. generally, investors are professionals and cash heavy. They get to the property first and can buy in full. Fannie and Freddie have launched initiatives that give an edge to the owner who will occupy the home, thereby helping to preserve the neighborhood. With First Look, only offers from owner occupants and buyers using public funds are considered during the first 15 days a property is on the market. Offers from investors will be considered only after the first 15 days have passed.

Direct from the Fannie Mae web site:

1. A First Look at properties for buyers using public funds
2. A reserved contract period that gives buyers a chance to renegotiate after obtaining an appraisal
3. An initiative designed to work with HUDs Neighborhood Stabilization Program (NSP)
4. An earnest money waiver for public entities and a discount for individuals (can be as little as $500 for an individual using NSP funds)
5. Extra time for due diligence and closing
6. Freddie Mac has a similar pilot program.

For more information about Fannie Mae’s First Look initiative contact publicentity_reosales@fanniemae.com or go to the Fannie press release

Thanks for Reading
www.yourpropertypath.com

Related Articles
The Real Estate Listing Agreement
How to Select a Real Estate Agent
Interview with Real Estate Brokers

Citigroup Suggests Mortgage Debt Forgiveness

Nearly one in four U.S. borrowers owe more on their mortgage than their home is worth, indicating that the housing recovery could see another wave of defaults. 23% of mortgage holders, were underwater in the third quarter, and 5.3 million have mortgages that are 20% higher than the value of their home since the recession began. Analysts expect prices to dip again this winter as foreclosures increase and economic growth remains modest. The Wall Street Journal reports.

Its not a new idea and many have always clamored for the banks to take some repsonsibility for loose lending practices that helped fuel the boom. But now it seems that a major institution is on board and will spearhead a push for mortgage debt foregivness.

Citigroups quarterly reports on mortgage borrowers

As unemployment rises, more borrowers need principal forgiveness on their mortgages, not just restructured loans, Citigroup Inc.'s mortgage chief said. To date, Citigroup helped 130,000 homeowners with $20 billion in mortgages outstanding avoid potential foreclosure last quarter. But that number increased 20% from the second quarter. The sub prime debacle is behind us, the culprit now is unemployment.

Unemployment
The Main Cause of Delinquencies

The main problem of the mortgage industry changes from house-price depreciation to unemployment, the mortgage market needs more programs where there is principal reduction for borrowers with negative equity in their home, as opposed to just a loan restructure, Mr. Das said. (Via Wall street Journal).

Loan mods alone are not enough to avoid another tsunami of foreclosures. The housing recovery's momentum has slowed, and it seems likely that house prices will now resume their fall. Re-default rates on loans that had already been modified in the quarter were nearly 39 percent, up 10 percent from the second quarter. High unemployment coupled with a loss of home equity are too big a burden for many home owners and the temptation to walk away, may begin to look like good business sense.

Foreclosures initiated in the third quarter rose about 10% from the second quarter but fell about 11% from a year earlier. Completed foreclosures fell less than 1% from the second quarter and about 48% from a year earlier. Things appear to be moderating, although I dont think Citigroup is addressing the Alt A recasts, which are expected to add to the problem, in a big way, beginning this year and into 2012.

Citigroup Speaks Out

Citi proposes new programs to forstall impending foreclosures. Recognizing that existing programs are not enough, the bank wants to reduce the principal owed and to bring this down to a number homeowners could cover. In return for forgivness of some debt, Citi wants to share any potential upside. Banks step up and take a hit along with the home owner, home owner gets to stay in the house, Home stays off the market helping home prices stabilize and bank gets equity share for the effort. Having the lenders in an equity share position with home owners is a solid idea.

Thanks for Reading
www.yourpropertypath.com

Related Articles
Fannie Mae Allows renters to Stay in Foreclosed Home
Fannie Mae Gets Into The Home Rental Business
NAR Report Third Quarter

Foreign Real Estate Investors Return To The Market

The 17th annual survey shows strong Interest In US Real Estate.

1. Foreign real estate lenders say they plan to increase lending by 58% in the U.S. in 2009.
2. Equity investors plan to increase investment activity by 40 percent globally and by 73% in the U.S. according to the results of the 17th annual survey

Preferences

D.C. trumps New York as the top global city for foreign investment. London and New York were second and third position for foreign investment interest. Five of the top ten cities were American and the U.S. was ranked as the country with the most opportunity for capital appreciation.

US Real Estate Trends

Our system certainly can surprise, but politically, we are very stable. There is a great deal of faith in our ability to adjust and change. AFIRE members surveyed find the U.S. continues to provide both the most stable and secure real estate investment environment and the best opportunity for capital appreciation.

This year, foreign investors are eying the multi family sector, followed by offices, industrial, retail, and hotel properties. US property is showing signs of an approaching price equilibrium and the dollars decline has made real estate even cheaper for foreign investors. Fed assurances that interest rates will remain low until a full blown recovery virtually assures an inexpensive dollar and once in a generation opportunity for foreign investment.

NAR reports International investors bought 154,000 homes and condos in the 12-month period ending in May, down nearly 10% from 170,000 for the same period a year earlier.But Since June, the dollar has tumbled by 9 to 11% against currencies like the Japanese yen, the Euro and the Canadian dollar. Florida leads the country accounting for 25% of foreign purchases, followed by California, Texas, and Arizona.(via AFIRE)
Green Matters

When asked to what extent a building’s green attributes influenced their decision to purchase a property, 11 percent said significantly so, and 60 percent said somewhat so. In almost the exact same percentages, investors said that green attributes were worth a greater rental premium. This was the first survey in which these two questions were asked. (Via AFIRE)

Thanks for Reading
www.yourpropertypath.com

Related Articles
Real Estate Trends: Rental Market
NAR Report Third Quarter
The official figures indicate recession has ended

Freddie MAc Weekly Update

30 Year Fixed Rate Falls Below 5 Percent

30-year fixed-rate mortgage: Averaged 4.78 percent with an average 0.7 point for the week ending November 25, 2009, down from last week when it averaged 4.83 percent. Last year at this time, the 30-year FRM averaged 5.97 percent. The 30-year has not been this low since the week ending April 30, 2009, when it averaged 4.78 percent.

The 15-year fixed-rate mortgage: Averaged 4.29 percent with an average 0.6 point, down from last week when it averaged 4.32 percent. A year ago at this time, the 15-year FRM averaged 5.74 percent. The 15-year FRM has never been this low since Freddie Mac started tracking it in 1991.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 4.18 percent this week, with an average 0.6 point, down from last week when it averaged 4.25 percent . A year ago, the 5-year ARM averaged 5.86 percent. The 5-year ARM has never been this low since Freddie Mac started tracking it in 2005.

One-year Treasury-indexed ARMs: Average 0.7 point, unchanged from last week when it averaged 4.35 percent. At this time last year, the 1-year ARM averaged 5.18 percent . The 1-year ARM has not been this low since the week ending July 7, 2005, when it averaged 4.33 percent

Freddie Sayz

Long term mortgage rates eased for the fourth consecutive week to record levels, said Frank Nothaft, Freddie Mac vice president and chief economist. Interest rates for 30 year fixed mortgage loans tied an all-time record low while both 15-year fixed mortgages and 5-year ARMs broke their corresponding records. Interest rates for 30-year fixed-rate loans are currently 0.8 percentage points below this years peak set in mid June, which shaves roughly $100 off the monthly payments on a $200,000 mortgage. House prices are slowly beginning to firm now.

For instance, annual house price declines slowed for the sixth consecutive month in September, down only 3 percent, and represented the smallest decline since February 2008, according the Federal Housing Finance Agency's purchase-only house price index. [PDF] Moreover, 11 of the 20 major metropolitan areas experienced monthly house price increases between August and September, based on the S&P/Case-Shiller® 20-city house price indexes

Thanks for Reading
www.yourpropertypath.com

Related Articles
Multifamily Apartments: Get Higher Rents and Lower Your Vacancy
How to Rent Your Property Faster
Research your Market

Mortgage Bankers Weekly Update

Mortgage Bankers Association for the week of 11/25/2009

Market Composite Index: (loan application volume) decreased 4.5 percent on a seasonally adjusted basis from one week earlier.

Refinance Index: decreased 9.5 percent from the previous week

Purchase Index: increased 9.6 percent from one week earlier.

Refinance Share of Mortgage Activity: decreased to 71.7 percent of total applications from 74.6 percent the previous week.
increased to 5.3 percent from 5.1 percent of total applications from the previous week.
ARM Refinance Activity: decreased to 5.4 percent from 5.5 percent of total applications from the previous week.

MBA outlook: (Excerpted from mbaa.org)

In summary the MBAA sees another year of high employment, rising home sales and prices beginning to stabilize. But continued weakness in the job market and excess supply and shadow inventory will slow any recovery in the housing market.

The Federal Reserve will extend their agency MBS purchase program through the end of the first quarter of 2010. However, Fed and Treasury purchases have accounted for the vast majority of all new issuance in this sector in recent months, and rates will increase when the Fed steps out of the market completely.

Thanks for Reading

www.yourpropertypath.com

Related Articles

NAR Report Third Quarter

FHA Losses: What it Means

FHA Has New Rules

Freddie Mac Weekly Update

30 Year Fixed Rate Falls Below 5 Percent

30-year fixed-rate mortgage: Averaged 4.83 percent with an average 0.7 point for the week ending November 19, 2009, down from last week when it averaged 4.91 percent. Last year at this time, the 30-year FRM averaged 6.04 percent.

The 15-year fixed-rate mortgage: Averaged 4.32 percent with an average 0.6 point, down from last week when it averaged 4.36 percent. A year ago at this time, the 15-year FRM averaged 5.73 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 4.25 percent this week, with an average 0.6 point, down from last week when it averaged 4.29 percent. A year ago, the 5-year ARM averaged 5.87 percent.

One-year Treasury-indexed ARMs: Averaged 4.35 percent this week with an average 0.6 point, down from last week when it averaged 4.46 percent. At this time last year, the 1-year ARM averaged 5.29 percent.

Freddie Sayz

Interest rate on 30 year fixed-rate mortgage loans fell for the third consecutive week to the lowest since the week ending May 21st, while 15 year fixed rates were the lowest since our records began in 1991, said Frank Nothaft, Freddie Mac vice president and chief economist. Low fixed rates throughout the third quarter prompted an estimated $1.1 trillion in refinancing activity, saving homeowners about $10 billion in aggregate monthly payments over the first 12 months of their new loan. Moreover, for the fourth consecutive quarter, more than 95 percent of prime borrowers who originally had an ARM selected a conventional fixed rate mortgage in the third quarter of this year.

Meanwhile, new home building showed some weakness in recent months. Residential construction eased 10.6 percent (annualized) between September and October, largely driven by a 33.3 percent decline in new condominium and apartment buildings and represented the slowest pace since records began in 1959. And homebuilder confidence in November remained a relatively low level, according to the National Association of Home Builders

Thanks for Reading

www.yourpropertypath.com

Related Articles

Mortgage Shoppers' Rights

Shopping for the Best Mortgage

Mortgage Bankers weekly Update

Mortgage Bankers Association for the week of November 18, 2009

Market Composite Index: (loan application volume) decreased 2.5 percent on a seasonally adjusted basis from one week earlier. .

Refinance Index: decreased 1.4 percent from the previous week

Purchase Index: decreased 7.9 percent compared with the previous week and was 14.7 percent lower than the same week one year ago.

Refinance Share of Mortgage Activity: increased to 72.9 percent of total applications from 71.5 percent the previous week. This refinance share is the highest share since the week ending May 15, 2009

ARM Refinance Activity: decreased to 5.4 percent from 5.5 percent of total applications from the previous week.

MBA outlook: (Excerpted from mbaa.org) The delinquency rate for mortgage loans on one-to-four-unit residential properties rose to a seasonally adjusted rate of 9.64 percent of all loans outstanding as of the end of the third quarter of 2009.

Its job loss that is now hurting people. Job losses continue to increase and drive up delinquencies and foreclosures because mortgages are paid with paychecks, not percentage point increases in GDP. A perfect observation by Jay Brinkmann, MBAs Chief Economist.

According to the MBAA.org site: T he outlook is that delinquency rates and foreclosure rates will continue to worsen before they improve. First, it is unlikely the employment picture will get better until sometime next year and even then jobs will increase at a very slow pace. Perhaps more importantly, there is no reason to expect that when the economy begins to add more jobs, those jobs will be in areas with the biggest excess housing inventory and the highest delinquency rates.

Thanks for Reading
www.yourpropertypath.com

Related Articles

FHA Losses: What it Means

FHA Has New Rules

Fannie Mae Allows renters to Stay in Foreclosed Homes

There was so much interest in this new Fannie program that I dug a little deeper and wanted to share some of this.

The problem is that many renters who pay rent on time are finding themselves under eviction, because their landlord has lost his property. Its made victims of well intentioned people who played by the rules. The Federal Govt recognized this as a national crisis. The magnitude of the problem is really quite sad.

More than 20% of the properties facing foreclosure nationwide are rentals. Some analysts estimate as high as 40% of all foreclosed homes being auctioned off are multi family rental property. The Mortgage Bankers Association thinks as many as 20% of all foreclosed homes are not owner occupied. Many speculators did not have the deep pockets and couldnt hang on. The result is really a national tragedy.

Fannie Mae’s National REO Rental Policy
Now a National Landlord

Here are some of the highlights

1. The policy applies only to renters occupying the home at the time of foreclosure or deed in lieu of foreclosure
2. You are the property's primary occupant
3. Cannot be investment property.
4. You can't be in bankruptcy.
5. The rent cannot exceed 31% of your monthly gross income.
6. Family detached homes, and manufactured housing, where the homeowners associations (HOAs) do not prohibit rentals. The policy applies to all renter-occupied single-family Fannie Mae REO
7. Renters will be charged market rate rent under the new lease
8. No security deposit will be required
9. The occupant agrees to be responsible for regular maintenance, to keep the property in good condition, and to permit marketing of the property for sale.
10. Fannie Mae reserves the right to market the property while a tenant is occupying the property. The property may be sold to an investor subject to the lease.

So, Fannie Mae will allow renters to stay for one year with the possibility of month to month extensions. Fannie gets some needed rental income, the real estate community hopes to see some price stabilization in the market place. Fannie clearly hopes that one year down the banks and housing markets will be viable and prices higher. This is a good program, it will be interesting to see whether the private markets will institute similar programs and begin to tighten the supply flow and help homes recover.

Thanks for Reading
www.yourpropertypath.com

Related Articles

Obama Extends the Home Buyers Tax Credit

Fannie Mae Gets Into The Home Rental Business

NAR Report Third Quarter

FHA Losses: What it Means

What Do They Do
FHA loan options make it easier to qualify for a home mortgage. Your loan is guaranteed by the government, making your application more attractive to lenders.

The FHA mortgage requires a low 3.5% down payment, and that money can come from a variety of sources including HUD down payment assistance grants. Typical closing costs for FHA home loans are around 2% or 3% of the total mortgage.

Loan Loss is Below Govt Mandate
Its capital reserves have fallen below the threshold mandated by Congress. The FHA has no recourse but to find ways to reduce their portfolio risk. Generally, when an investment portfolio needs to lower its risk profile, it means that requirements will tighten and costs will rise until the risk profile is better balanced.

What it Means To You
Harder to Qualify

The FHA is considering a variety of changes like requiring larger down payments for FHA insured mortgages, demanding higher credit scores and raising mortgage premiums. The FHA has taken on an enormous role in the marketplace. It dominates the new mortgage business. The FHA is one of the tools the Obama administration is using to take up the vacuum left by the banks. Generally, they are not lenders of such magnitude. In the second quarter, nearly 50% of all first-time buyers in the market used a loan insured by the FHA (via cbsmarketwatch.com).

Normally, a low risk lender because FHA home loans have income requirements, maximum loan amounts and most loans are 30 year fully amortizing fixed-rate mortgages. But the FHA has had its neck out since the housing crises began. They like many other Govt institutions are filling the gap left by private lenders. And will continue to do so until the market normalizes, but it clearly is taking a toll.

Thanks for Reading
www.yourpropertypath.com

Obama Signs Home Buyer Tax Credit Extension.

The home buyers' tax credit has been extended to April 30, 2010. Obama approved the extension as part of a $24 billion economic stimulus bill.

The housing tax credit
Qualifyers

The measure limits the purchase price of the home to $800,000.
It also imposes income caps so that people who make more than $125,000 annually and couples who make more than $225,000 would not be eligible for a refund.
Anyone who collects the tax credit but sells their home within three years of buying it must return the refund.
Current homeowners who are buying a new primary residence would be eligible for a $6,500 tax credit starting Dec. 1 if they owned their home for five consecutive years in the previous eight.
Military families who have been deployed overseas for 90 days or more in 2008 or 2009, would have until April 30, 2011 to sign a contract.
The program is estimated at $11 billion

Double Bubble Trouble

Dr Shiller, co-developer of the Case Shiller home price index and Yale economist points out that the price recovery of the last few months is the sharpest snap back he has ever seen. he is concerned that that in supporting a real estate recovery we may again be fueling a bubble.

Thanks for Reading
www.yourpropertypath.com

Related Articles
NAR Report Third Quarter
The official figures indicate recession has ended
Tracking The Bond Markets for Direction

Obama Signs Home Buyer Tax Credit Extension.

The home buyers tax credit has been extended to April 30, 2010. Obama approved the extension as part of a $24 billion economic stimulus bill.

The housing tax credit
Qualifyers
The measure limits the purchase price of the home to $800,000.
It also imposes income caps so that people who make more than $125,000 annually and couples who make more than $225,000 would not be eligible for a refund
Anyone who collects the tax credit but sells their home within three years of buying it must return the refund
Current homeowners who are buying a new primary residence would be eligible for a $6,500 tax credit starting Dec. 1 if they owned their home for five consecutive years in the previous eightMilitary families who have been deployed overseas for 90 days or more in 2008 or 2009, would have until April 30, 2011 to sign a contract.
The program is estimated at $11 billion
Double Bubble Trouble

Dr Shiller, codeveloper of the Case Shiller home price index and Yale economist points out that the price recovery of the last few months is the sharpest snap back he has ever seen. he is concerned that that in supporting a real estate recovery we may again be fueling a bubble.

Thanks for Reading
www.yourpropertypath.com

Related Articles

Fannie Mae Gets Into The Home Rental Business

Good News for foreclosure victims.Some homeowners will get an option to rent the home that they just lost. Its possible to stay in your home as a renter. Fannie Mae will give borrowers facing foreclosure an option to rent their homes for a year.

Foreclosed home owners will be able to sign a one year lease, with possible month to month extensions with Fannie Mae. Good for everybody.

Homeowners get a little relief and are able to remain in their homes for a year or more. This will buy them the time they need to regroup. It will also help keep neighborhoods from going missing. Rather than rows of abandoned homes with all the crime and destruction that vandals create.. Neighbors that have not lost their homes will not see more equity loss as squatters and criminals move into vacant homes. The banks are reluctant landlords and they are allowing property to decline.

It will keep supply off the market for at least another year and that is good for all the handlers, Fanne Mae because it can put off the expense of a foreclosure, the banks because less supply will protect equity in homes they are off loading and everyone one because it will help stabilize home prices. I dont think we can have a strong recovery without real estate.

To qualify, homeowners have to live in the home as the primary residence and prove that they can afford the market rent, which will be established by the management company running the program. In many cases, rents will be less than the mortgage because properties that are now worth far less than they originally paid.

The downside is seems to be that homes that might normally have been foreclosed and sold will now remain owned by taxpayers. Homes, according to Dr Shiller have risen faster in the last few months than he has ever seen. Perhaps Fannie will profit a little while doing a good thing for families that must be a little traumatized by it all.

And even if prices don't rebound quickly. Fannie Mae gets rental income, avoids foreclosure expenses gets to helps people.

Thanks for Reading
www.yourpropertypath.com

Related Articles
NAR Report Third Quarter
The official figures indicate recession has ended
Tracking The Bond Markets for Direction

NAR Report Third Quarter

Sales Up Prices Down

This same story has been playing our for quite a while now. The trend towards lower prices will probably continue even as the recession winds down. Continuing job loss, a weak recovery and real problems in all real estate sectors, now focused on commercial property and Alt A high end homes, should keep a lid on prices. That said people are beginning to feel good again, or at least less wary. They are stepping out and buying homes and that is a good good sign.

Existing-Home Sales Surge While Price Moderate

Most states saw rising existing-home sales in the third quarter, with price declines in many metro areas, according to the latest survey by the National Association of Realtors®.

NAR reports that total state existing-home sales of single-family and condos, increased 11.4 percent and are now 5.9 percent higher than the third quarter of
2008. Sales increased in 45 states and 28 states saw double-digit gains. Year over
year sales were higher in 32 states and D.C. Buyers are coming back and in some
parts of California we are seeing multiple bids and homes selling for more than list.

During the third quarter, 123 out of 153 metropolitan statistical areas, 2 reported lower median existing single-family home prices while 30 areas had price gains

NAR chief economist,Lawrence Yun spoke of the the tax credit. He goes on to say: We can’t underestimate just how powerful a catalyst the first-time home buyer tax credit has been for the housing sector. It’s given buyers the confidence they needed to get off the fence and take advantage of extremely affordable housing conditions. The buying conditions this year are the most favorable on record dating back to 1970, but the tax credit is allowing buyers to set aside any reservations about waiting for a better deal.

The decline in the national median price has moderated recently, and a shrinking supply of unsold inventory suggests we are getting closer to price stabilization in many areas, but we need a steady stream of financially qualified buyers to further reduce inventory and get us to a self-sustaining market, Yun said.

Soaking up supply

Foreclosures will continue to come on the market, but rising sales from the expanded tax credit should stabilize home prices by next spring and help to stem future foreclosures. To be sure the numbers are mixed and some areas are experiencing reversals, but over all we are beginning to pull ourselves up out of this slump. As long as we continue to see a Fed willing to support the markets until they are strong enough to stand on their own, we should be able top avoid a double dip. Encouraging was to hear the G20 come out with a continuation of supports. This recovery is still in the hands of policy makers.

Thanks for Reading
www.yourpropertypath.com

Related Articles
Green Homes and Sales Trends
Real Estate : How do you price it? Investment analysis for the rest of us.
Gross Rent Multiplier: Pricing Fair Value For Smaller Properties
Real Estate: Pricing Fair Value for Larger Properties

Freddie Mac Weekly Update

30 Year Fixed Rate Falls Below 5 Percent

30-year fixed-rate mortgage: Averaged 4.98 percent with an average 0.7 point for the week ending November 5, 2009, down from last week when it averaged 5.03 percent. Last year at this time, the 30-year FRM averaged 6.20 percent.

The 15-year fixed-rate mortgage: Averaged 4.40 percent with an average 0.6 point, down from last week when it averaged 4.46 percent. A year ago at this time, the 15-year FRM averaged 5.88 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 4.35 percent this week, with an average 0.6 point, down from last week when it averaged 4.42 percent. A year ago, the 5-year ARM averaged 6.19 percent.

One-year Treasury-indexed ARMs: Averaged 4.47 percent this week with an average 0.5 point, down from last week when it averaged 4.57 percent. At this time last year, the 1-year ARM averaged 5.25 percent.

Freddie Sayz

Mortgage rates fell back this week pulling interest rates on 30-year fixed mortgages under 5 percent, said Frank Nothaft, Freddie Mac vice president and chief economist. Lower mortgage rates should help homeowners lower their monthly payments and feed the ongoing recovery in the housing market. For instance, the Federal Housing Finance Agency reported that Freddie Mac and Fannie Mae have financed more than 3.5 million refinance loans during the first nine months of 2009.

Freddie Mac estimates that borrowers who refinanced their conventional loan during the third quarter reduced their interest rate by a median of 1.1 percentage points, which will save these borrowers an aggregate of $3 billion in mortgage payments over the next 12 months. Further, pending sales for existing homes rose for the eighth straight month in September to the strongest pace since December 2006, while spending on private residential construction jumped 3.9 percent and represented the largest gain since July 2003. In the third quarter of this year, residential fixed investment added almost a full percentage point to economic growth.

Thanks for Reading
www.yourpropertypath.com

Related Articles

Congress Creates a New Liquid Market

Reverse Mortages Can Help You Buy A New Home

Loan Modification: A Primer

Mortgage Bankers Association: Weekly Application Update

Mortgage Bankers Association for the week of November 12, 2009

Market Composite Index: (loan application volume) increased 3.2 percent on a seasonally adjusted basis from one week earlier.

Refinance Index: increased 11.3 percent from the previous week and the seasonally adjusted Purchase Index decreased 11.7 percent from one week earlier.

Purchase Index: decreased 13.7 percent compared with the previous week and was 21.6 percent lower than the same week one year ago.

Refinance Share of Mortgage Activity: increased to 71.5 percent of total applications from 66.1 percent the previous week. This refinance share is the highest share since May of this year, when the 30-year fixed-rate mortgage rate was around 4.7 percent, close to the historical low of the survey.

ARM Refinance Activity: decreased to 5.5 percent from 6.1 percent of total applications from the previous week.

MBA outlook: (Excerpted from mbaa.org)The Federal Reserve will extend their MBS purchase program, a commitment to buy $1.25 trillion of mortgage securities, through the end of the first quarter of 2010. However the Fed has aslso announced that they are beginning to taper or pahse out the program.

The economy grew in the third quarter, but job losses continued, and the unemployment rate rose further, to 10.2% in October, the highest level since 1983.

1. Housing markets are beginning to slowly recover from the worst recession in decades, but are vulnerable to additional macroeconomic shock.
2. Existing homes sales increased by 9.4 percent in September to 5.57 million at a seasonally adjusted annual rate. However, new home sales fell by about 3.5 percent to 402,000 in September.
3. Inventories of unsold homes have declined, but remain very high. The months supply of existing homes for sale decreased from 9.3 months in August to 7.8 months in September. For new homes, the months supply was unchanged at 7.5 months in September.
4. Homeowner vacancy rates increased slightly in the third quarter to 2.6 percent from 2.5 percent in the second quarter. The long-term average for this rate is 1.7 percent, so there remains a substantial overhang of vacant units. Rental vacancy rates also increased in the third quarter, to 11.2 percent from 10.6 percent in the second quarter.

Thanks for Reading
www.yourpropertypath.com

Related Articles

Mortgage Fees - What are they?

EEM

Reverse Mortgages: Get the Facts

Reverse Mortgages

Freddie Mac Weekly Update

30-year fixed-rate mortgage: Averaged 4.98 percent with an average 0.7 point for the week ending November 5, 2009, down from last week when it averaged 5.03 percent. Last year at this time, the 30-year FRM averaged 6.20 percent

The 15-year fixed-rate mortgage: Averaged 4.40 percent with an average 0.6 point, down from last week when it averaged 4.46 percent. A year ago at this time, the 15-year FRM averaged 5.88 percent.

Five-year indexed hybrid adjustable-rate mortgages ARMs: Averaged 4.35 percent this week, with an average 0.6 point, down from last week when it averaged 4.42 percent. A year ago, the 5-year ARM averaged 6.19 percent.

One-year Treasury-indexed ARMs: Averaged 4.47 percent this week with an average 0.5 point, down from last week when it averaged 4.57 percent. At this time last year, the 1-year ARM averaged 5.25 percent.

Freddie Sayz

Mortgage rates fell back this week pulling interest rates on 30-year fixed mortgages under 5 percent, said Frank Nothaft, Freddie Mac vice president and chief economist. Lower mortgage rates should help homeowners lower their monthly payments and feed the ongoing recovery in the housing market. For instance, the Federal Housing Finance Agency reported that Freddie Mac and Fannie Mae have financed more than 3.5 million refinance loans during the first nine months of 2009. Freddie Mac estimates that borrowers who refinanced their conventional loan during the third quarter reduced their interest rate by a median of 1.1 percentage points, which will save these borrowers an aggregate of $3 billion in mortgage payments over the next 12 months.

Further, pending sales for existing homes rose for the eighth straight month in September to the strongest pace since December 2006, while spending on private residential construction jumped 3.9 percent and represented the largest gain since July 2003. In the third quarter of this year, residential fixed investment added almost a full percentage point to economic growth

Thanks for Reading
www.yourpropertypath.com

Related Articles
How to Spot a Predatory Lender
Shopping for the Best Mortgage
Home Equity Credit Line Lines Of Credit Vs. Traditional Second Mortgage Loans
Mortgage Lock-Ins - What are they

Renters who lose their homes to foreclosures

Most of the occupants are homeowners, who must scramble to find housing with little notice. They're being joined by scores of renters who discover, often with no warning, that their rented house or apartment is now owned by a bank, which wants them out.

Federal legislation signed in May 2009 gives important rights to tenants whose landlords have lost their properties through foreclosure

Owners

Typically, foreclosed home were owner-occupied, but often it's owned by investors and speculators who were hoping to profit from the rents and rising equity. They got caught between falling housing values and rising mortgage interest rates. Many speculators were not cash heavy and couldnt sell or cover their monthly costs. In short, they lost their investments

The Bank as Property Manager

If the bank becomes the owner, it may pay a property management company to handle the property. But don't expect service. These properties are an albatross and wont get much attention.

Many tenants have no idea that their building has been taken at foreclosure. They continue to pay rent to the former owner, who often pockets the money but isnt inclined to maintain the building they no longer own. Because the banks are stuck with so many foreclosed properties that they can't sell, they were not committed to maintaining the property making life impossible for their tenants until those tenants are evicted.

How it Was

Before May 20, 2009, most renters lost their leases upon foreclosure. The rule in most states was that if the mortgage was recorded before the lease was signed, a foreclosure wiped out the lease (this rule is known as "first in time, first in right

May 20 2009

The rules changed dramatically on May 20, 2009, when President Obama signed the Protecting Tenants at Foreclosure Act of 2009. This legislation allowed the lease to survive a foreclosure. That means the tenant could stay at least until the end of the lease, and that month-to-month tenants would be entitled to 90 days' notice before having to move out

Not perfect, but at least we are beginning to pay attention to the hidden victims in this mess, the tenants that pay rent on time and do no wrong.

Thanks for Reading
www.yourpropertypath.com

Related Articles
REO: Still an Opportunity
Extend The Home Buyers Tax Credit
The Fed and The Housing Recovery
Banks and the Housing Recovery