Obama said move to allow judges to rewrite terms important to economy
Associated Press
updated 4:18 p.m. PT, Thurs., April 30, 2009
WASHINGTON - The Democratic-controlled Senate on Thursday defeated a plan to spare hundreds of thousands of homeowners from foreclosure through bankruptcy, a bill President Barack Obama embraced but did little to see it through.
For complete article, click in this link: http://www.msnbc.msn.com/id/30503750/
Thursday, April 30, 2009
Home prices tumble, but no new record
U.S. home prices dropped 18.6 percent, but pace of decline has slowed
Associated Press
updated 6:50 a.m. PT, Tues., April 28, 2009
NEW YORK - In another sign the housing crisis could be reaching the bottom, home prices dropped sharply in February but for the first time in 25 months the decline was not a record.
The Standard & Poor’s/Case-Shiller index released Tuesday showed home prices in 20 major cities tumbled by 18.6 percent from February 2008. That was slightly better than January’s 19 percent and the first time since January 2007 the index didn’t set a record.
But the good news was mixed. All 20 cities in the report showed monthly and annual price declines, but half recorded annual records. Prices fell by more than 10 percent in 15 cities, including Las Vegas, San Francisco and Phoenix. In fact, Phoenix home prices have lost more than half their value since peaking in July 2006.
For complete article, select the following link: http://www.msnbc.msn.com/id/30453629/
Associated Press
updated 6:50 a.m. PT, Tues., April 28, 2009
NEW YORK - In another sign the housing crisis could be reaching the bottom, home prices dropped sharply in February but for the first time in 25 months the decline was not a record.
The Standard & Poor’s/Case-Shiller index released Tuesday showed home prices in 20 major cities tumbled by 18.6 percent from February 2008. That was slightly better than January’s 19 percent and the first time since January 2007 the index didn’t set a record.
But the good news was mixed. All 20 cities in the report showed monthly and annual price declines, but half recorded annual records. Prices fell by more than 10 percent in 15 cities, including Las Vegas, San Francisco and Phoenix. In fact, Phoenix home prices have lost more than half their value since peaking in July 2006.
For complete article, select the following link: http://www.msnbc.msn.com/id/30453629/
Friday, April 24, 2009
New home sales data show encouraging signs
New reports raise hope slides in housing, manufacturing nearing end
Associated Press
Friday, April 24, 2009
WASHINGTON - New home sales and demand for big-ticket manufactured goods both were better than expected in March, raising some hopes that the long slides in housing and manufacturing are slowly coming to an end.
For the complete article, click on http://www.msnbc.msn.com/id/30386322/
Associated Press
Friday, April 24, 2009
WASHINGTON - New home sales and demand for big-ticket manufactured goods both were better than expected in March, raising some hopes that the long slides in housing and manufacturing are slowly coming to an end.
For the complete article, click on http://www.msnbc.msn.com/id/30386322/
Tuesday, April 21, 2009
Freddie Mac’s refinance policy drawing fire
Brokers, small lenders say they are being cut out of Obama’s plan
Associated Press
updated 5:55 p.m. PT, Mon., April 20, 2009
WASHINGTON - Mortgage brokers and small lenders say they've been left out of a big part of the Obama administration's plan to help borrowers refinance their home loans and take advantage of near record-low interest rates.
The new guidelines released earlier this month are different for Fannie Mae and Freddie Mac, the government-controlled companies that own or guarantee almost 31 million mortgages — more than half of all U.S home loans. Most strikingly, mortgage loans held by Freddie Mac can only be refinanced by the company that currently collects payments on the loan, known as the mortgage servicer.
To check out complete article, select this link
Associated Press
updated 5:55 p.m. PT, Mon., April 20, 2009
WASHINGTON - Mortgage brokers and small lenders say they've been left out of a big part of the Obama administration's plan to help borrowers refinance their home loans and take advantage of near record-low interest rates.
The new guidelines released earlier this month are different for Fannie Mae and Freddie Mac, the government-controlled companies that own or guarantee almost 31 million mortgages — more than half of all U.S home loans. Most strikingly, mortgage loans held by Freddie Mac can only be refinanced by the company that currently collects payments on the loan, known as the mortgage servicer.
To check out complete article, select this link
Monday, April 20, 2009
The Benefit Of Buyers Paying Up-Front Points
Brought to you by the CALIFORNIA ASSOCIATION OF REALTORS®
Friday, February 13, 2009
This week’s C.A.R. Mortgage Update contains information about common mistakes borrowers make when applying for a mortgage; interest rates on jumbo loans; an increase in late payments in affluent communities; and rising interest rates.
The new rules of mortgage lending
Current mortgage rates and changes in loan underwriting standards have led some borrowers to make mistakes when applying for a mortgage loan. One old adage that many borrowers fall into is not paying up-front points. In previous real estate cycles, paying one percentage point was equivalent to shaving off approximately a quarter of a percentage point of interest. In today’s market, one percentage point can lower the interest rate by as much as 1 percent, changing a 6 percent interest rate into one that is 5 percent.
Another common mistake some borrowers make is not locking in an interest rate, especially when the rates are at historic lows, as they are currently. Many borrowers believe that if a favorable rate is available this week, a lower one will likely be offered next week. Mortgage experts advise clients to lock in a rate if the numbers work and not try to wait for a better rate that may not come.
Friday, February 13, 2009
This week’s C.A.R. Mortgage Update contains information about common mistakes borrowers make when applying for a mortgage; interest rates on jumbo loans; an increase in late payments in affluent communities; and rising interest rates.
The new rules of mortgage lending
Current mortgage rates and changes in loan underwriting standards have led some borrowers to make mistakes when applying for a mortgage loan. One old adage that many borrowers fall into is not paying up-front points. In previous real estate cycles, paying one percentage point was equivalent to shaving off approximately a quarter of a percentage point of interest. In today’s market, one percentage point can lower the interest rate by as much as 1 percent, changing a 6 percent interest rate into one that is 5 percent.
Another common mistake some borrowers make is not locking in an interest rate, especially when the rates are at historic lows, as they are currently. Many borrowers believe that if a favorable rate is available this week, a lower one will likely be offered next week. Mortgage experts advise clients to lock in a rate if the numbers work and not try to wait for a better rate that may not come.
Housing Index Posts Biggest Jump In 5 Years
Associated Press
updated 1:08 p.m. PT, Wed., April 15, 2009
LOS ANGELES - Homebuilders are feeling a lot more optimistic that the worst housing downturn in decades may be finally starting to turn around.
An index of builders' confidence released Wednesday posted its biggest one-month jump in five years in April as many homebuyers seized on lower prices and incentives and took advantage of lower interest rates and tax credits.
The National Association of Home Builders/Wells Fargo housing market index climbed five points to 14. While still near historically low levels, the latest index reading is the highest since October.
"This is a very encouraging sign that we are at or near the bottom of the current housing depression," said David Crowe, chief economist for the Washington-based trade association.
The report reflects a survey of 360 residential developers nationwide, tracking builders' perceptions of market conditions. Index readings lower than 50 indicate negative sentiment about the market.
The index hit an all-time low of 8 in January as mounting layoffs, strict mortgage requirements and the worsening U.S. economy sapped demand for new homes.
In response, many builders stepped up sales incentives, slashed prices and trumpeted an $8,000 tax credit for homebuyers enacted in February as part of the Obama administration's economic stimulus package. Mortgage rates, meanwhile, have hovered below 5 percent for weeks, offering an additional inducement for would-be homebuyers.
As a result, homebuilders have reported an uptick in traffic in recent weeks. KB Home, a Los Angeles-based homebuilder, reported last month that new home orders jumped by 26 percent in its fiscal first quarter.
"Some of the most favorable buying conditions in a lifetime are now in place, and they are drawing more consumers back to the market," said NAHB Chairman Joe Robson, a homebuilder from Tulsa, Okla.
Joshua Shapiro, chief U.S. economist for the consulting firm MFR Inc., said the jump reflects the perception the market is improving, but cautioned some builders may be overly optimistic.
"The weakness that preceded it is so pronounced that I think you get a little bit of an exaggeration to people's responses to surveys like this," Shapiro said.
Regionally, builder confidence rose by eight points in the Northeast to 16 and by six points in the Midwest to 14. It climbed by five points in the South to 17 and by four points to 9 in the West.
Builders' gauge of current sales conditions climbed by five points to 13, while builders' expectation of buyer traffic also rose by five points to 14.
The biggest jump came in builders' outlook for sales over the next six months, which climbed 10 points to 25.
In California, a $10,000 tax credit for new home purchases also helped lift sales, according to a separate national survey homebuilders conducted by John Burns Real Estate Consulting
The firm's latest survey shows new home sales, buyer traffic and expectation of future sales all rose since March.
"We think the improvement is attributable primarily to improved affordability," said John Burns, the firm's chief executive. "The new home tax credit in California is also helping."
The improved industry outlook gave battered housing stocks a lift. Shares of Beazer Homes and Lennar got the biggest boost, climbing more than 13 percent in afternoon trading Wednesday.
updated 1:08 p.m. PT, Wed., April 15, 2009
LOS ANGELES - Homebuilders are feeling a lot more optimistic that the worst housing downturn in decades may be finally starting to turn around.
An index of builders' confidence released Wednesday posted its biggest one-month jump in five years in April as many homebuyers seized on lower prices and incentives and took advantage of lower interest rates and tax credits.
The National Association of Home Builders/Wells Fargo housing market index climbed five points to 14. While still near historically low levels, the latest index reading is the highest since October.
"This is a very encouraging sign that we are at or near the bottom of the current housing depression," said David Crowe, chief economist for the Washington-based trade association.
The report reflects a survey of 360 residential developers nationwide, tracking builders' perceptions of market conditions. Index readings lower than 50 indicate negative sentiment about the market.
The index hit an all-time low of 8 in January as mounting layoffs, strict mortgage requirements and the worsening U.S. economy sapped demand for new homes.
In response, many builders stepped up sales incentives, slashed prices and trumpeted an $8,000 tax credit for homebuyers enacted in February as part of the Obama administration's economic stimulus package. Mortgage rates, meanwhile, have hovered below 5 percent for weeks, offering an additional inducement for would-be homebuyers.
As a result, homebuilders have reported an uptick in traffic in recent weeks. KB Home, a Los Angeles-based homebuilder, reported last month that new home orders jumped by 26 percent in its fiscal first quarter.
"Some of the most favorable buying conditions in a lifetime are now in place, and they are drawing more consumers back to the market," said NAHB Chairman Joe Robson, a homebuilder from Tulsa, Okla.
Joshua Shapiro, chief U.S. economist for the consulting firm MFR Inc., said the jump reflects the perception the market is improving, but cautioned some builders may be overly optimistic.
"The weakness that preceded it is so pronounced that I think you get a little bit of an exaggeration to people's responses to surveys like this," Shapiro said.
Regionally, builder confidence rose by eight points in the Northeast to 16 and by six points in the Midwest to 14. It climbed by five points in the South to 17 and by four points to 9 in the West.
Builders' gauge of current sales conditions climbed by five points to 13, while builders' expectation of buyer traffic also rose by five points to 14.
The biggest jump came in builders' outlook for sales over the next six months, which climbed 10 points to 25.
In California, a $10,000 tax credit for new home purchases also helped lift sales, according to a separate national survey homebuilders conducted by John Burns Real Estate Consulting
The firm's latest survey shows new home sales, buyer traffic and expectation of future sales all rose since March.
"We think the improvement is attributable primarily to improved affordability," said John Burns, the firm's chief executive. "The new home tax credit in California is also helping."
The improved industry outlook gave battered housing stocks a lift. Shares of Beazer Homes and Lennar got the biggest boost, climbing more than 13 percent in afternoon trading Wednesday.
Despite Housing Downturn, Renters Get No Relief
Associated Press
updated 4:13 p.m. PT, Tues., April 14, 2009
NEW YORK - Jeffrey Myers can't make the rent — by himself. He works part-time at UPS and as a freelance photographer, but the $2,200 he pulls in a month isn't enough to afford an apartment in Orange County, Calif., without a roommate.
"It's hard to meet people who live by themselves. Most people have roommates," said Myers, 31.
For homebuyers, affordability is the best it's been for decades, but for millions of renters coast to coast affordability is still getting worse, according to a study released Tuesday.
As the recession forces more Americans out of work, working-class tenants are bearing the brunt of the cuts. Record foreclosures, at the same time, mean more people are competing for low-cost rentals. And rents in many expensive cities still haven't budged because so few apartments were built in recent years.
A renter earning the nation's minimum wage of $6.55 could not afford a one-bedroom apartment in any county in the nation.
"It's a very dire situation," said Dean Baker, co-director for the Center for Economic and Policy Research. "And it's likely to get worse in the two years ahead," as unemployment climbs and businesses cut worker hours and pay.
A renter needs to earn $17.84 an hour to cover the monthly rent on the average $928 two-bedroom apartment, if they don't want to spend more than 30 percent of their income on housing. But the median hourly wage for an American renter is $14.69, more than $3 short of what's needed, according to the study by the National Low Income Housing Coalition.
"So what's going to happen is a lot, unfortunately, will be out on the streets," said Edward Wolff, an economist at New York University.
The lowest-income renters stand to get hit hardest. The unemployment rate is at a 25-year high of 8.5 percent, but that percentage was even higher — 12.6 percent — for those without a high school degree. Some of the worst layoffs have come from industries that employ low-income workers like construction, retail and manufacturing.
Families displaced by foreclosures are also flooding the apartment market, increasing competition for affordable rentals.
"It's likely they're income-constrained or don't have credit or savings," for costlier apartments, said Rachel Drew, a research analyst at Harvard University's Joint Center for Housing Studies.
And while rents are falling in some individual markets, many cities are showing little signs of softness because demand for apartments remains high. Renters in Seattle, Los Angeles, San Francisco and Portland, Ore., all traditionally strong markets, won't see many rent cuts.
Even renters in beleaguered apartment markets like Phoenix, Atlanta, Las Vegas and Florida likely won't enjoy the deals in their areas because the local economies are reeling.
"Even when rents are dipping slightly, it's because more people are out of work," in that area, Baker said. "Affordability only improves when wages increase in proportion with rent."
The most expensive metropolitan area, according to the report, is Stamford, Conn. A renter must earn $32.75 an hour to afford a two-bedroom apartment there. San Francisco ranked second at $31.88 per hour, followed by Honolulu at $31.37, Westchester County, N.Y., at $30.96 and Santa Cruz, Calif., at $30.58 per hour.
Half of the 10 most costly metros are in California.
updated 4:13 p.m. PT, Tues., April 14, 2009
NEW YORK - Jeffrey Myers can't make the rent — by himself. He works part-time at UPS and as a freelance photographer, but the $2,200 he pulls in a month isn't enough to afford an apartment in Orange County, Calif., without a roommate.
"It's hard to meet people who live by themselves. Most people have roommates," said Myers, 31.
For homebuyers, affordability is the best it's been for decades, but for millions of renters coast to coast affordability is still getting worse, according to a study released Tuesday.
As the recession forces more Americans out of work, working-class tenants are bearing the brunt of the cuts. Record foreclosures, at the same time, mean more people are competing for low-cost rentals. And rents in many expensive cities still haven't budged because so few apartments were built in recent years.
A renter earning the nation's minimum wage of $6.55 could not afford a one-bedroom apartment in any county in the nation.
"It's a very dire situation," said Dean Baker, co-director for the Center for Economic and Policy Research. "And it's likely to get worse in the two years ahead," as unemployment climbs and businesses cut worker hours and pay.
A renter needs to earn $17.84 an hour to cover the monthly rent on the average $928 two-bedroom apartment, if they don't want to spend more than 30 percent of their income on housing. But the median hourly wage for an American renter is $14.69, more than $3 short of what's needed, according to the study by the National Low Income Housing Coalition.
"So what's going to happen is a lot, unfortunately, will be out on the streets," said Edward Wolff, an economist at New York University.
The lowest-income renters stand to get hit hardest. The unemployment rate is at a 25-year high of 8.5 percent, but that percentage was even higher — 12.6 percent — for those without a high school degree. Some of the worst layoffs have come from industries that employ low-income workers like construction, retail and manufacturing.
Families displaced by foreclosures are also flooding the apartment market, increasing competition for affordable rentals.
"It's likely they're income-constrained or don't have credit or savings," for costlier apartments, said Rachel Drew, a research analyst at Harvard University's Joint Center for Housing Studies.
And while rents are falling in some individual markets, many cities are showing little signs of softness because demand for apartments remains high. Renters in Seattle, Los Angeles, San Francisco and Portland, Ore., all traditionally strong markets, won't see many rent cuts.
Even renters in beleaguered apartment markets like Phoenix, Atlanta, Las Vegas and Florida likely won't enjoy the deals in their areas because the local economies are reeling.
"Even when rents are dipping slightly, it's because more people are out of work," in that area, Baker said. "Affordability only improves when wages increase in proportion with rent."
The most expensive metropolitan area, according to the report, is Stamford, Conn. A renter must earn $32.75 an hour to afford a two-bedroom apartment there. San Francisco ranked second at $31.88 per hour, followed by Honolulu at $31.37, Westchester County, N.Y., at $30.96 and Santa Cruz, Calif., at $30.58 per hour.
Half of the 10 most costly metros are in California.
Obama urges millions to refinance mortgages
Associated Press
updated 12:21 p.m. PT, Thurs., April 9, 2009
WASHINGTON - Declaring “good news” in the midst of an economic meltdown, President Barack Obama on Thursday urged families to take advantage of near-record low mortgage rates by refinancing their home loans.
“We are at a time where people can really take advantage of this,” Obama said, seated with a handful of homeowners who have already lowered their bills.
But he also warned people to watch out for scam artists, cautioning, “If somebody is asking you for money up front before they help you with your refinancing, it’s probably a scam.”
Rates on 30-year mortgages inched upward this week but remain near the lowest level in decades, allowing borrowers with strong credit and stable jobs to save money if they refinance.
The average rate on a 30-year fixed-rate mortgage rose to 4.87 percent this week, up from 4.78 percent last week, Freddie Mac reported Thursday. That was the lowest in the history of the survey, which dates back to 1971.
Low rates have sparked a surge in refinancing activity, with nearly 80 percent of new home loan applications coming from borrowers seeking to refinance. Freddie Mac’s sibling company, Fannie Mae, refinanced $77 billion in loans last month, nearly double February’s volume.
“The main message we want to send today is there are 7 to 9 million people across the country who right now could be taking advantage of lower mortgage rates,” Obama said in a photo opportunity in the Roosevelt Room. “That is money in their pocket.”
Foreclosures and defaults continue to break records. A record 5.4 million American homeowners with a mortgage, or nearly 12 percent, were at least one month late or in foreclosure at the end of last year. And nearly half of homeowners with a risky subprime adjustable-rate mortgage were in trouble.
Last month, the Obama administration launched a new plan to provide $75 billion in incentives for the mortgage industry to modify loans to help borrowers avoid foreclosure. On Thursday, the president encouraged people to take advantage of a government Web site — www.makinghomeaffordable.gov — to see how they can get help.
In recent weeks nearly 200,000 homeowners have contacted Bank of America to find out if they are eligible to refinance under the Obama administration’s new guidelines, said Vijay Lala, the bank’s product management executive. “We’ve seen a tremendous amount of interest.”
updated 12:21 p.m. PT, Thurs., April 9, 2009
WASHINGTON - Declaring “good news” in the midst of an economic meltdown, President Barack Obama on Thursday urged families to take advantage of near-record low mortgage rates by refinancing their home loans.
“We are at a time where people can really take advantage of this,” Obama said, seated with a handful of homeowners who have already lowered their bills.
But he also warned people to watch out for scam artists, cautioning, “If somebody is asking you for money up front before they help you with your refinancing, it’s probably a scam.”
Rates on 30-year mortgages inched upward this week but remain near the lowest level in decades, allowing borrowers with strong credit and stable jobs to save money if they refinance.
The average rate on a 30-year fixed-rate mortgage rose to 4.87 percent this week, up from 4.78 percent last week, Freddie Mac reported Thursday. That was the lowest in the history of the survey, which dates back to 1971.
Low rates have sparked a surge in refinancing activity, with nearly 80 percent of new home loan applications coming from borrowers seeking to refinance. Freddie Mac’s sibling company, Fannie Mae, refinanced $77 billion in loans last month, nearly double February’s volume.
“The main message we want to send today is there are 7 to 9 million people across the country who right now could be taking advantage of lower mortgage rates,” Obama said in a photo opportunity in the Roosevelt Room. “That is money in their pocket.”
Foreclosures and defaults continue to break records. A record 5.4 million American homeowners with a mortgage, or nearly 12 percent, were at least one month late or in foreclosure at the end of last year. And nearly half of homeowners with a risky subprime adjustable-rate mortgage were in trouble.
Last month, the Obama administration launched a new plan to provide $75 billion in incentives for the mortgage industry to modify loans to help borrowers avoid foreclosure. On Thursday, the president encouraged people to take advantage of a government Web site — www.makinghomeaffordable.gov — to see how they can get help.
In recent weeks nearly 200,000 homeowners have contacted Bank of America to find out if they are eligible to refinance under the Obama administration’s new guidelines, said Vijay Lala, the bank’s product management executive. “We’ve seen a tremendous amount of interest.”
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