Mortgage News
November 6, 2007 - Market volatility has been high since July and has translated into much tighter
underwriting guidelines for all conventional and non-conventional lenders alike. The residential markets have seen the biggest
changes and this is why our underwriting guidelines are not what they were 6 months ago. Please contact us to up to the minute
guidelines as they may change without notice.
July 27,2007 - Market volatility is high this week with big sell-offs in many sectors on continuing
worries about over-extending credit by many mortgage funds (sub-prime and Alt-A). The 10 year note is currently trading down
near the 4.75% yield range which means that the bond market is having one heck of a rally. The home equity market is drying up
fast. Exceptions to guidelines are non existent and a couple of investors have stopped buying equity lines of credit, while
others are no longer buying second liens behind loans with the potential for negative amortization. I suggest you dust off
your mortgage insurance rate cards and calculators.
July 18, 2007 - The big news is the DOW teetering on the edge of breaking
the 14,000 level for the past 3 days. The bond market has also beem in a good mood, with yields on
the 10 year note moving lower into the 4.99% to 5.02% range. Fed Chairman Bernanke's assessment
of housing exacerbated investors' concern over news that the Bear Stearns
funds were left essentially worthless by bad bets on subprime loans, which are made to those with
poor credit. A weaker housing market has made it more difficult for borrowers who get behind on
payments to refinance and pay off debts.We are still seeing trememdous
liquidity in the US financial markets most likely due to the ever weakening dollar.
July 13, 2007 - GE announces they will sell their mortgage business (WMC)
while Standard and Poors threatened to downgrade $12 Billion in subprime mortgage backed
securities. Moody's actually downgraded over $5 Billion in subprime MBS. Subprime mortgage update
article.
July 12, 2007 - Fair Isaac to change scoring
algorithm to eliminate the tradeline loophole allowing people to
artificially raise their FICO scores by adding themselves to the credit
accounts of people with high FICO scores. You can read more about the changes to
the FICO algorithm.
July 10, 2007 - Fed Chairman, Ben Bernanke, spoke this morning to academics
regarding the state of inflation and how it is measured in the US economy this
afternoon. If you are an academic, it may have been interesting, but little was gleaned regarding
how the FOMC is viewing inflation today. Of note was the DOW closing nearly 150 points lower by day's
end due to revised earnings estimates and more sour news in the Sub-Prime / Hedge Fund world.
June 29, 2007 - The Federal Open Market Committee (FOMC), aka The Fed, announcement
yesterday spooked the markets saying that they are still concerned about inflation.
The outlook is that they will not be lowering the Fed Funds Rate anytime soon.
