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Mortgage Approvals Are Getting More And More Scarce Â« Home Loans …

admin — Wed, 10 Feb 2010 02:01:56 +0000

Mortgage approvals are getting harder and harder to get these days. Everything has tightened up and it gets more difficult every day for you to qualify. Think about what that means to you if you are carrying other non mortgage debt and are thinking about a refinance in the next few years.

The bottom line is you may not be able to qualify later due to many reasons such as home values that have gone down, further restrictions from the lenders, or changes to your income or credit score. This points out another reason why you need to get ahead of your debt. If you start paying down your debt you’ll increase your available cash flow as you pay off each debt. You’ll improve your credit score faster by accelerating the payoff of your debts. Your debt to income ratio will improve as you pay down the debts. And you could start putting more money towards your retirement accounts and savings as you pay off the debts. You’ll be in a better position to qualify if you still need to.

But why stress over not being able to qualify for a refinance later when you may be able to ensure you don’t need it by getting your debts under control starting today?

Your friends at No More Mortgage

Read on and think about your future needs while you do.

David Kosmecki | February 9, 2010

The economyâ€™s improving but lending standards are not. Nationally, banks are making mortgage approvals harder to come by.

Underwriting guidelines are tightening.

The data comes from the Federal Reserveâ€™s quarterly survey to its member banks.Â The Fed asks senior bank loan officers around the country to report on â€œprimeâ€ residential mortgage guidelines over the most recent 3 months and whether theyâ€™ve tightened.

For the period October-December 2009:

Roughly 1 in 4Â banks said guidelines tightened
Roughly 3 in 4 banks said guidelines were â€œbasically unchangedâ€

Just 2 of 53 banks said its guidelines had loosened.

Combine the Fedâ€™s survey with recent underwriting updates from the FHA and generally tougher standards for conventional loans and itâ€™s clear that lenders are much more cautious about their loans than they were, say, in 2007.

Todayâ€™s Plymouth home buyers and would-be refinancers face a bevy of new borrowing hurdles including:

Higher minimum FICO scores
Larger downpayment requirements for purchases
Larger equity positions for refinances
Lower debt-to-income ratios

So, if youâ€™re on the fence about whether now is a good time to buy a home, or make that refi, consider acting sooner rather than later.Â It doesnâ€™t necessarily matter that mortgage rates are low, or that thereâ€™s an up-to-$8,000 home purchase tax credit for households that qualify.Â With each passing quarter, fewer and fewer applicants are eligible to take advantage.

View the original story at

Home Loans Midwest – http://homeloansmidwestblog.com/

Bank glitch traps pair in web of foreclosure

admin — Sun, 07 Feb 2010 20:17:35 +0000

Here is an interesting story about a family that got caught up in the bureaucracy of the banks when their mortgage servicing was changed and are now facing foreclosure due to “paperwork”. Hopefully they’ll fix the issue and get to the point where they have no more mortgage problems. But it shows you the importance of making sure you are on top of your finances. This should have been easily caught right away on the statements.

Bank glitch traps Lancaster pair in web of foreclosure

By JIM WEIKER

Jim WeikerÂ |Â Dispatch

Audre Smith in front of her Lancaster home.

Someday, someone will produce a fair and balanced moral analysis of the housing collapse.

Until then, we must settle for shallow, ill-informed and facile explanations that fall into two main camps: The lenders are crooks who got what they deserved, or the homeowners are fools who had no business borrowing what they did.

On one side, sympathy is hard to summon for bankers who aren’t being paid for loans that any third-grader could have foreseen as doomed.

On the other, it’s a bit disingenuous for borrowers to blame banks for lending them money. That’s akin to blaming the woman who agrees to goes out with you for what proves to be a less-than-enjoyable date: You might question her judgment, but you’re the person, after all, who made the overture.

The fact is, some homeowners borrowed far more than they should have and are now paying the price of such greed.

And then, there are others.

Read the article here on Bank glitch traps Lancaster pair in web of foreclosure

Are Home Market Values on the Rise?

admin — Thu, 12 Nov 2009 12:36:58 +0000

In August, prices rose in 17 oF 20 cities. Only Charlotte, Cleveland and Las Vegas recorded month-to-month declines. In the past year, prices are down 11.3% in the 20 cities. Prices in all 20 cities were lower in August 2009 than in August 2008, but in general, year-over-year declines have lessened. “We do want to remind people of the upcoming expiration of the federal first-time buyer’s tax credit in November and anticipated higher unemployment rates through year-end,” said David Blitzer, chairman of the index committee at S&P. “Both may have a dampening effect on home prices.”

Economists at Goldman Sachs said they expect a further 5% to 10% decline in prices. Falling values have been a major factor contributing to the chaos in the global economy, because financial institutions made too many bad bets that U.S. home prices would never fall. Millions of homeowners have found themselves owing more on their house than it is worth. They cannot sell for what they owe, and they cannot refinance their home loans. Nor can they borrow against their home to finance their consumption. Trillions of dollars of wealth have evaporated. Rising unemployment is now driving foreclosures. Another wave of foreclosures from interest-payment-only mortgages is anticipated, beginning in spring 2010.

Nationwide Home Values

admin — Mon, 09 Nov 2009 16:25:51 +0000

Following are, in descending order, the price changes in each of the 20 cities in August:

Minneapolis, up 3.2%
San Francisco, up 2.8%
Detroit, up 1.9%
Chicago, up 1.7%
Los Angeles, up 1.6%
Phoenix, up 1.6%
San Diego, up 1.6%
Washington, up 1.4%
Miami, up 1.1%
Atlanta, up 1%
Denver, up 1%
Boston, up 0.9%
New York, up 0.5%
Tampa, up 0.4%
Portland, up 0.3%
Dallas, up 0.2%
Seattle, up 0.1%
Las Vegas, down 0.3%
Charlotte, down 0.4%
Cleveland, down 0.5%

Following are, in descending order, the price changes in each of the 20 cities from August 2008 to August 2009:

Las Vegas, down 29.9%
Phoenix, down 25.1%
Detroit, down 22.6%
Miami, down 18.8%
Tampa, Fla., down 17.7%
Seattle, down 14.7%
Minn., down 13.7%
Chicago, down 12.7%
Portland, down 12.5%
San Fran., down 12.5%
Los Angeles, down 12%
Atlanta, down 10.6%
New York, down 9.6%
San Diego, CA down 8.9%
Charlotte, NC, down 8.6%
Washington, down 7.9%
Boston, down 4.2%
Cleveland, down 2.8%
Denver, down 1.9%
Dallas, down 1.2%

LAS VEGAS: A TALE ABOUT THE BOOM/BUST CYCLE

OptionARM Loans and Mortgage Re-Sets Are Cause for Concern

admin — Thu, 29 Oct 2009 16:33:18 +0000

No More Mortgage is very concerned about the chart below, which shows the second wave of mortgage re-sets coming down the pike, starting in summer 2010.
It is noteworthy that we are in a “lull” which may have allowed confidence to push up US equities over the past 6 months.
Note that the first wave of mortgage re-sets was largely comprised of sub-prime mortgages that came due during 2007. This second wave is mostly comprised of OptionARM loans, which were the mortgage vehicle “du jour” in California, Arizona, and Florida during 2005-2006, and which will begin impacting the economy next year.
In these sun-belt markets, high real estate prices drove home buyers into using these low-ball loans, which allowed borrowers to pay below-market monthly payments. The re-set period is 5 years on these loans, and many of the collateral properties are well under water in value.
It was the first wave of mortgage defaults which led to the fall of Fannie/Freddie and the market break in the fall of 2007. It remains to be seen what this next wave will do when it begins to hit over the next few months. No More Mortgage believes that the risks for the US economy are serious.

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First housing gain in 34 months

admin — Thu, 30 Jul 2009 14:26:32 +0000

NO MORE Mortgage is happy to see the latest home price statistics, but we are cautious that a final bottom has been set. One month does not make a trend. We continue to believe that the current rally, both in home prices and in the stock market, will be tested this fall, and if the indexes are still showing signs of improvement by October, then we can take heart.

We remind investors of the terrible reality of what a 50% loss can do to an asset, whether itâ€™s a home or a 401(k) account.

If someone holds an asset worth $100,000 that declines by 50%, it now has a value of $50,000. In order for this asset to get back to its original value of $100,000, it would have to come back by 100%. In other words, a 50% decline takes a 100% recovery to make up.

For more information on this story visit MarketWatch.

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