St Louis Mortgage Interest Rates Remain Low but obtaining mortgage is more challenging

By , on June 2nd, 2010

After the problems we have seen over the past couple of years in the real estate, mortgage and banking industries it is not surprising we have seen massive legislative changes brought about which make it more challenging for a home-buyer to obtain a mortgage. Some of the changes borrowers will see when they attempt to obtain a mortgage to buy a home or refinance their existing mortgage include:

Documentation – Did you like that “no-doc” loan you did last time around? Forget it! This time around you may be asked to provide, in addition to items that have been Continue Reading →

Fannie Mae Issues Guidelines For HAFA Short-Sales and Deed-in-Lieu

By , on June 1st, 2010

UPDATE- June 2, 2010: The National Association of REALTORS obtained answers from the Treasury Department on 3 common questions about HAFA:

agents are not permitted to rebate a portion of their commission to the buyer, sellers who are real estate agents must list their home for sale with another broker, not their own broker, and the incentive allowed for subordinate lien holders (6% of any one subordinate lien, up to a total of $6,000 for all subordinate liens) is a hard cap and may not be supplemented from any source.

Dennis Norman

In March I did an update on Continue Reading →

St Louis Area New-Home Building Permits Drop In April After Spiking in March

By , on June 1st, 2010

Dennis Norman

After seeing a spike in permits for new homes in St. Louis in March, with the exception of the City of St. Louis, all the St. Louis metro area counties saw a decline in new home permits in April, some rather steep based upon the latest data reported by the Home Builders Association of St. Louis (HBA).

Existing home sales data and mortgage application data have suggested that the April 30th deadline for the home-buyer tax credit caused an artificial surge in the housing market as buyers raced to beat the deadline to buy a home; Continue Reading →

New Home Buyers At Risk of Losing Fixed-Rate Mortgages Again

By , on May 27th, 2010

Dennis Norman

Earlier this month I did a post about important legislation in Missouri, specifically HB 2058, which would make badly needed changes to the Missouri Mechanic’s Lien Statute, because if it didn’t pass purchasers of new homes would face hurdles obtaining long-term fixed-rate mortgages as title companies have threatened to stop providing mechanic’s lien coverage.

On May 17th I was happy to update the post with the news that the bill had passed the House and Senate and was just awaiting the signature of Governor Nixon to become effective.

Herein the problem lies…

Word is Governor Nixon Continue Reading →

National Flood Insurance Program Expiring Again; St Louis Interest Rates Drop Again

By , on May 26th, 2010

The National Flood Insurance Program, known as the NFIP, lapsed March 28 this year and left many pending home sales in limbo.

Congress and President Barack Obama temporarily reinstated the program 18 days later on April 16 as part of a bill that also extended unemployment benefits and Medicare reimbursement for doctors. However, the temporary extension of the NFIP legislation will expire again on May 31.

The stage has now been set for another lapse in funding for the program just weeks before the mandatory June 30 closing deadline for buyers attempting to satisfy the requirements of the federal Continue Reading →

Tax Credit Deadline Spurs New Home Sales in April; Prices Drop

By , on May 26th, 2010

Dennis Norman

The U.S. Department of Commerce released a report showing the sale of New Homes in April were at a seasonally adjusted annual rate of 504,000, a 14.8 percent increase from the revised March rate of 439,000 and is 47.8 percent above a year ago. The inventory of new homes (seasonally adjusted) at the end of April is just 5.0 months a huge decline from just two months ago when it was 9.2 months.

My Mantra

As has been my long-running mantra, I don’t like “seasonally adjusted” numbers and “rate” of sales (nor does Standard & Poors, Continue Reading →

Existing Home Sales Increase In April As Tax Credits End

By , on May 24th, 2010

Dennis Norman

Sales increased for second consecutive month-

With the home-buyer tax credits ending April 30th, it’s not surprising that we saw an increase of home sales in March, and now in April, as buyers rushed to buy before the deadline to have a congract of April 30, 2010. According to the latest report from the National Association of REALTORS(R), existing home sales in the US in April increased 7.6 percent to a seasonally adjusted-annual rate of 5.77 million units in April from a revised level of 5.36 million units in March, and increased 22.8 percent from a year Continue Reading →

Six Charged with Wire Fraud Based on $20 Million Mortgage Fraud Scheme

By , on May 23rd, 2010

A 10-count indictment has been unsealed charging six individuals with conspiracy to commit wire fraud and wire fraud, announced U.S. Attorney Karen P. Hewitt. The defendants are charged with submitting false and fraudulent mortgage loan applications and related documents to banks and other lending institutions, thereby inducing the institutions to make approximately 36 loans totaling approximately $20,800,000.

The defendants charged with participating in the conspiracy are: Brian Andrew La Porte; Daniel John Schuetz; Michael Wayne Wickware; Roxanne Yvette Hempstead; Darryl Anthony Wallace, aka Darryl Anthony White; and Terrence Smith, aka Terry Lee Smith. The indictment alleges that the defendants devised Continue Reading →

Ponzi Scheme and Mortgage Fraud Mastermind Sentenced to 15 Years, Eight Months

By , on May 22nd, 2010

The founder and head of Chicago Development and Planning was sentenced yesterday to 15 years and eight months in prison, and ordered to pay more than $9 million in restitution for wire fraud, mail fraud, and money laundering, U.S. Attorney Joseph P. Russoniello announced.

Patricia Morgen pleaded guilty on Dec. 16, 2009. According to the plea agreement, she admitted creating a scheme to solicit investors for a company called Chicago Development and Planning, with the promise of substantial guaranteed return profit payments. Morgen falsely promised investors that their funds would be used to purchase real property to be rented or Continue Reading →

Mortgage Default Rate Improves In April

By , on May 20th, 2010

Dennis Norman

I know it looks like I’m doing my second post today on the same topic, but I’m really not……my post earlier today was about the rate of mortgage delinquency, which can be defined as homeowners that are late, to varying degrees, on their house payments. This post is about mortgage default rates, which is homeowners that are over 90 days late on mortgage payments, have filed bankruptcy, are in foreclosure or on whom the lender has written off part or all of the balance of the loan. In other words these are the borrowers Continue Reading →

Not Out Of The Woods Yet; Mortgage Delinquences and Foreclosures On The Rise

By , on May 20th, 2010

1st Quarter Delinquencies; Up? Down? He said – She Said…

If you frequent this site, then you may recall that a little over a week ago (May 10th to be exact) I wrote a post that said the delinquency rate for homeowners mortgages had dropped in the first quarter of this year, the first drop since 2006. Now the post title says delinquencies have increased, so what gives?

Well, for one thing, different sources of information. The “good” delinquency report came from TransUnion and they get their data by doing a “random sampling” of their database of 27 million Continue Reading →

St Louis Mortgage Interest Rates Remain Low; FHA To Make Changes

By , on May 19th, 2010

It’s all about Europe debt crisis…

Trading action in the mortgage markets have been and continue to be influenced by the ongoing concern over Europe’s debt crisis. This uncertainty has overshadowed a growing amount of data flow from our own economy that is signaling or own recovery. This uncertainty continues to drive capital into dollar denominated assets. The FHA To Reduce Allowable Seller Concessions this Summer/ Is the Housing Market Recovering for Real…

The percentage sellers can take from the sales price of a home to fund closing costs is being cut from 6% to 3%. According to an announcement Continue Reading →

Can You Obtain a Home Loan If you Did a Short Sale or Deed-in-Lieu?

By , on May 13th, 2010

Dennis Norman

In an effort to “support overall market stability and reinforce the importance of borrowers working with their lenders when they have difficulty paying their mortgages”, Fannie Mae has eased their policies with regard to the eligibility of borrowers to obtain a new mortgage loan after having a short-sale or deed-in-lieu of foreclosure. The “waiting period” that someone must wait before getting a new mortgage after a short-sale or deed-in-lieu has been shortened in certain situations.

Changes to the Waiting Period After a Short-Sale or Deed-in-Lieu of Foreclosure:

Deed-In-Lieu of Foreclosure Current waiting period – 4 years Continue Reading →

St Louis Interest Rates Remain Low In Spite of Fed Pull Out

By , on May 12th, 2010

A few months ago, it was widely believed that the Fed’s massive purchase of mortgage backed securities was keeping long-term interest rates artificially low in order to stimulate the economy. It’s been six weeks since the Fed stopped buying mortgage backed securities, and there is no sign that that the end of the purchase program has caused mortgage rates to rise by any meaningful amount.

Given the uncertainty of the monetary crisis in Europe and the mystery of a stock market crash and rebound, markets continue to be very volatile with large swings from day to day– this should continue Continue Reading →

Slight Decline In Number of Underwater Homeowners

By , on May 11th, 2010

Dennis Norman

According to a report released by CoreLogic, there were 11.2 million homeowners that were in a negative equity, or “underwater“, position on their mortgages as of the end of the first quarter of this year. This number is equal to 24 percent of all homeowners with a mortgage in the U.S., which is the same percentage as the prior quarter, however the actual number of underwater borrowers was down slightly from 11.3 million borrowers that were underwater in the prior quarter. In addition, there are an additional 2.3 million borrowers that have less than five percent Continue Reading →

No More Fixed-Rate Loans On New Homes If Missouri Lawmakers Don’t Act Quickly

By , on May 11th, 2010

Dennis Norman

UPDATE – May 17, 2010 – THANKS TO MISSOURI LAWMAKERS (and the efforts of the Missouri Association of REALTORS and St. Louis Home Builders Association, readers of this post that responded, and others) THE MECHANICS LIEN LAW PASSED! ASSUMING THE GOVERNOR SIGNS IT INTO LAW FINANCING ON NEW HOMES AS WE KNOW IT HAS BEEN PRESERVED!

This week, which is the last week of the legislative session in Jefferson City, the Missouri Senate will probably take up debate on HB 2058, which is a bill that makes needed changes to the Mechanic’s Lien Statute in Missouri Continue Reading →

Mortgage Delinquencies Fall in 1st Quarter; First Decline Since 2006

By , on May 10th, 2010

Dennis Norman

Consistent with the report on mortgage delinquencies from LPS that I wrote about last week, today TransUnion released it’s report on mortgage delinquencies showing they fell 1.74 percent in the first quarter of this year, which is the first quarterly decline since 2006. This is good news, however, not to rain on the parade, but we do need to remember that the 4th quarter of 2009 had a record-setting mortgage delinquency rate so to have the rate for the following quarter drop simply means, if you want to do the glass half-empty thing, this quarter didn’t Continue Reading →

Fewer Homeowners Falling Delinquent; More Delinquent Borrowers Bringing Payments Current

By , on May 6th, 2010

Dennis Norman

A report published by Lender Processing Services (LPS) analyzing homeowner’s performance on their mortgages as of March 2010 shows that, while foreclosure and mortgage delinquency rates are still near record levels, the pace may be slowing with fewer new loans becoming delinquent and an increase in the number of people bringing their loans current.

Fewer Borrowers Are Going From Current To Delinquent –

The dark blue line on the chart below represents the number of “new” delinquencies for each period, and as you can see, the number dropped sharply in March for people that moved Continue Reading →

St. Louis Foreclosures and Mortgage Delinquencies Hit Record Levels in March

By , on May 6th, 2010

Dennis Norman

A report released by CoreLogic showed the St. Louis metro area to have a foreclosure rate in March of 1.49 percent up slightly from February’s rate of 1.44 percent and an increase of 39.3 percent from the year prior when the rate was 1.07 percent.

The national foreclosure rate for March remains over twice the rate of St. Louis at 3.23 percent and was an increase of 73.9 percent from a year ago when the national foreclosure rate was 2.32 percent.

No End In Site

Unfortunately, I don’t think we are going to see much, if Continue Reading →

St Louis Real Estate News – World’s Financial Crisis May Help Keep Mortgage Rates Low

By , on May 5th, 2010

Constantly changing headlines involving the European financial crisis (Greece, possibly Portugal) along with the uncertainty of the stock market should make dollar denominated assets, i.e. Treasuries, Mortgage Backed Securities etc. appealing.

These issues should be enough to limit or prevent mortgage rates from moving higher in the near future.

St. Louis Mortgage Interest Rates – May 5, 2010 *

30-year fixed-rate mortgage 4.875% no points 15-year fixed-rate mortgage 4.375% no points 5/1 adjustable rate mortgage 3.625% no points FHA/VA 30-year fixed rate mortgage 5.125% Jumbo 5/1 ARM 4.125% no points Jumbo 15 year fixed rate mortgage 4.625%

For more Continue Reading →

Home Prices and Interest Rates May Offset Loss of Tax Credits

By , on May 3rd, 2010

61 Percent of Those Looking for or Considering Buying a Home Had No Plans to Use the Tax Credit

Dennis Norman

According to a survey from Better Homes and Gardens Real Estate, the majority of people looking for, or considering buying, a home had no plans to take advantage of the First-Time or Move-Up/Repeat Home Buyer Tax Credits.

The survey, which was conducted online during the last week of February 2010, was designed to identify factors affecting today’s home buying decisions. Respondents were people from across the country who were searching for a new home, saving up to Continue Reading →

St Louis Real Estate – Interest Rates Hold Steady, Home Buyers Race To Get Tax Credit

By , on April 28th, 2010

Realtors, home buyers and sellers are rushing to complete sales agreements before the tax credit for home purchases expires this week; home buyers must have a deal by April 30 and close by June 30 to qualify for a tax break up to $8,000 for first-time home buyers and $6,500 for those moving to a different residence. The Treasury Department and the real estate industry have termed the program a success, helping people buy homes. However, many tax experts say it has been singularly cost-ineffective: most of the $12.6 billion in credits through end of February was collected by Continue Reading →

Mortgage Fraud Continues to Climb – Midwest Leads the Way

By , on April 27th, 2010

Incidents of Mortgage Fraud Increase 7 Percent from 2008 to 2009 – Florida, New York and California Top List of States with Highest Mortgage Fraud and Misrepresentation Rates

Dennis Norman

Reported incidents of mortgage fraud and misrepresentation by professionals in the mortgage industry in the U.S. are continuing to climb and increased by 7 percent from 2008 to 2009, according to a new report released today by the Mortgage Asset Research Institute, a LexisNexis® service. While the pace has slowed since the 2007-2008 increase of 26 percent, the continued increase is believed to be attributed to better Continue Reading →

CEO of the Duncan Group In St Louis Pleads Guilty in Multi-Million Dollar Ponzi Scheme

By , on April 26th, 2010

The United States Attorney’s Office announced today that Aaron Duncan, the former CEO and owner of The Duncan Group, has pleaded guilty to fraud charges involving a $3.9 million investment scheme.

According to court documents, Duncan represented that The Duncan Group was involved in real estate investments, including buying, rehabilitating, and selling residential real estate. Duncan solicited investors in Missouri and around the United States to participate in his real estate projects through The Duncan Group by making false representations regarding the security of investments and the rates of returns promised. Bank records revealed that Duncan operated The Duncan Group Continue Reading →

Record Foreclosure Rate Could Hurt Demand For Homes and Slow Recovery

By , on April 26th, 2010

Dennis Norman

In a report just issued by Radarlogic there is some good news for the housing industry as in the report Michael Feder, President and CEO of Radar Logic, states “the evidence continues to support the view that housing has stabilized and is in the early stages of recovery.” However, the report also reminds us that RealtyTrac reported that foreclosure filings set a record in March, with filings reported on 367,056 properties, the “highest monthly total since RealtyTrac began issuing its report in January 2005. The report indicates an increasing concern about the threat that foreclosures pose Continue Reading →

Survey Shows More Than 80 Percent of First-Time Home Buyers Believe Now Is a Good Time to Buy a Home

By , on April 24th, 2010

Dennis Norman

Century 21 Real Estate LLC announced the results of its First-Time Home Buyers and Sellers Survey, which captured and compared the opinions of prospective home buyers and sellers who either purchased or sold their first home within the past year or are planning to buy or sell their first home within the next year.

More than 80 percent of first-time home buyers and sellers feel the current housing market is more affordable today than this time last year, despite the fact that 40 percent of all respondents are more worried about the economy compared to this Continue Reading →

Last Minute Review of Homebuyer Tax Credit and Interest Rate Update

By , on April 21st, 2010

First-time homebuyers made up a record high share of sales in March, according to the latest Campbell Surveys poll of more than 1,500 real estate agents nationwide; First-time homebuyers accounted for 48.2% of all home purchases. The March uptick comes ahead of the extended tax credit deadline.

Who Qualifies-

First Time Home Buyer $8,000 Tax Credit The primary home buyer and/or spouse may not have owned a home in the previous three (3) years to qualify. Buyers cannot be claimed as a dependent by another taxpayer or be under the age of 18. Repeat Home Buyer $6,500 Tax Credit Continue Reading →

Housing Recovery Dependant on Inventory Reduction

By , on April 19th, 2010

Dennis Norman

Housing is stabilizing but excess inventory and shadow supply are hindering recovery according to the April 2010 Economic Outlook released today by Fannie Mae’s Economics & Mortgage Market Analysis Group.

The report projects that new home sales (which are at record lows) will be slow to recover until inventory of existing homes and the foreclosure overhang are worked off. The comments about existing home sales were more optimistic saying key indicators for existing home sales, including pending home sales and purchase applications, are showing good signs of a pickup.

Jobs, a driving force for housing, are Continue Reading →

Home Affordable Modification Program (HAMP) Update

By , on April 15th, 2010

Dennis Norman

As readers know, I have been somewhat critical of the Home Affordable Modification Program (HAMP) which is part of the Obama administrations’ Making Home Affordable Program for a few reasons, one is I believe it is just a temporary “band-aid” and not a cure for the problem and two, it does not appear the program is going to help near as many people as the Obama administration initially said it would. Yesterday a report was issued that shows there is progress being made and, through the end of March, a total of 230,000 homeowners Continue Reading →

St. Louis Real Estate News – Who are the homebuyers?

By , on April 14th, 2010

First-time home buyers comprised an unprecedented 47 percent of the market last year according to a recently published report by the National Association of Realtors (NAR). NAR’s report, 2009 Profile of Home Buyers and Sellers, points to the federal tax credit and the historic affordability of housing as the most likely reasons first-time buyers scored so high in sales. According to NAR, housing economists predict that “2010 will be an even bigger year for first-timers.” Who are these people, and what do they want? Most are married – Forty-nine percent are a married couple. Single females comprise a quarter Continue Reading →

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