|Conventional Mortgage Loans Most Popular With Millennials
The average credit score for all borrowers dipped to 722 in November 2017 from 728 in November 2016, according to a report released by Ellie Mae, a cloud-based platform provider for the mortgage finance industry, on Wednesday.
The report, which also gave indicators on millennial borrowers through the Ellie Mae Millennial tracker, said that average credit score for closed loans to millennials dropped to 723 in November 2017 from 725 in the year-ago period even as some lenders were making it easier to get a home loan by lowering their credit score requirements to attract a larger pool of potential first-time homebuyers.
“With the average credit score dipping, lenders are extending credit to borrowers who may have had no previous access to the housing market,” said Joe Tyrell, EVP of Corporate Strategy at Ellie Mae.
While the Millennial Tracker, an online interactive tool that provides access to demographic data on millennial homebuyers, showed a slight decline in the overall average scores for closed loans to millennials year-over-year, the trend was most pronounced for FHA and VA loans to this generation of homebuyers.
According to the tracker, the average credit score on a closed FHA refinance loans to millennial borrower in November 2016 was 678. This score dropped to 669 in November 2017. The report also indicated that closed VA refinance loans decreased from 725 to 710 year-over-year.
read more: M Report
Situs Acquires MountainView Financial Solutions
Situs, the premier provider of strategic business and technology solutions to the real estate industry, announced Friday that it has entered into a definitive agreement to acquire MountainView Financial Solutions, a leading service provider to the financial services industry.
The transaction, which is subject to customary closing conditions, is expected to be completed on or before Jan. 31. Headquartered in Denver, CO, MountainView is an industry-leading valuation and risk analytics business for the financial services sector.
Read more: Situs
Home Prices Are Set to Soar in 2018
The temperature may be frigid across much of the nation, yet home prices are sizzling and sellers are in the hot seat.
Sales prices jumped 7 percent annually in November, according to a new report from CoreLogic.
That is the third straight month at that pace, far higher than the price gains in the first half of 2017. Low supply and high demand are fueling the spurt, and neither of those is expected to ease up anytime soon.
Supply is actually falling even more now, and a strengthening economy is pushing demand. This will have potential buyers out early this year, trying to get a jump on the spring market.
“Rising home prices are good news for home sellers, but add to the challenges that homebuyers face,” said Frank Nothaft, chief economist at CoreLogic, in the report. Nothaft said the limited supply is the worst at the lower end, and will hit the growing number of first-time buyers hardest.
read more: CNBC
Regulatory Relief, GSEs To Dominate Banking Policy on Capitol Hill in ’18
Congress is likely to pass significant changes to the Dodd-Frank Act early thist year and then attempt to overhaul roughly a third of the U.S. economy by restructuring the housing finance system.
The House and Senate is working on passing a regulatory relief package that would increase the “systemically important financial institution” threshold and make a number of other legislative changes that will benefit community banks.
The Senate is expected to approve in January or February the carefully negotiated package between Senate Banking Committee Chairman Mike Crapo and moderate Democrats on the panel. The House will then either adopt the Senate deal or use it as a framework for a slightly different legislative proposal. However, the Senate deal is delicate so the House is limited in how far it might go to change the deal.
“It might be the lowest common denominator we can get to,” said Rep. Steve Stivers, R-Ohio, of the Senate deal. “Everything in that bill is easy; the question is can we get anything done that is a little harder, and I would like to get things down that are a little more ambitious.”
Rep. Emanuel Cleaver, D-Mo., added that the bill is bipartisan “so that gives me cause that it is going to be a reasonably good piece of legislation, but I think we ought to not blindly follow in behind the Senate.”
read more: American Banker
Fannie and Freddie Regain Capital Reserves, Withhold Billions from Treasury
Fannie Mae and Freddie Mac have capital reserves again.
As expected, the government-sponsored enterprises at year’s end made their quarterly dividend payments to the Department of the Treasury.
But, thanks to the new agreement between the Federal Housing Finance Agency and the Treasury, each of the GSEs withheld billions from the Treasury to ensure that each has enough capital on hand to “cover other fluctuations in income in the normal course of each Enterprise’s business.”
Under the previous version of the Preferred Stock Purchase Agreements that went into effect when the government took the GSEs into conservatorship, Fannie and Freddie sent dividends to the Treasury each quarter that they are profitable.
The PSPAs also stipulated that the GSEs were prohibited from rebuilding capital and each of the GSEs’ capital base was required to be reduced, with their capital reserves scheduled to be drawn down to $0 in 2018.
But that all changed earlier this month when the FHFA announced a new agreement with the Treasury that allows the GSEs to hold a $3 billion capital reserve.
read more: Housingwire
Last-Minute Rush to Prepay Taxes Gives Way to Confusion and Anger
In Hempstead, a Long Island town where the typical property tax bill tops $10,000, residents have lined up the last week of December to prepay those taxes for 2018. They were trying to save thousands of dollars before the new federal tax bill, which went into effect on New Year’s Day, sharply limits deductions for state and local taxes.
But late on Dec. 27, the Internal Revenue Service issued new guidance that those people may not be able to save the money after all, because a loophole that they were hoping to exploit might be narrower than thought. So when Donald X. Clavin Jr., Hempstead’s receiver of taxes, showed up to work the morning of Dec. 28, the lines were still there — but residents had fresh questions. Mr. Clavin had few answers.
“Everybody on line, they’re going, ‘Don, are we going to be able to do this?’ ” Mr. Clavin said. “And I can’t give them a yes or a no.”
The new tax bill, and its $10,000 cap on all local and state tax deductions, has generated a variety of strong emotions — including anxiety and frustration — in places like Hempstead.
By Dec. 28, however, that stew of emotions had been replaced by utter confusion, as well as rage, including among people who had shelled out money only to discover that they might not get any benefit.
read more: NYT
Job Growth Slows, But Unemployment Rate Remains 4.1% in December
The pace of hiring slowed last month, but employers added better than 2 million jobs for the seventh straight year in 2017 and the unemployment rate held at a 17-year low.Nonfarm payrolls rose a seasonally adjusted 148,000 in December, the Labor Department said Friday. That brought employment gains for the year to 2.1 million. It is only the second time on record — the other being in the 1990s — when the economy has produced jobs at that pace for that long. Still, last year was the worst for payroll gains since 2010.
Meanwhile, the unemployment rate remained at 4.1%, matching the lowest level since December 2000 for the third straight month. Hourly wage growth, from a year earlier, failed to accelerate, but wage gains look a bit better on a weekly basis, because Americans are working more hours.
Recent economic data “all point to an economy that has shifted into third gear in front of a large corporate tax cut that figures to turbocharge growth in the near term despite the modest deceleration in the pace of hiring in December,” said Joseph Brusuelas, chief economist at consulting firm RSM US.
Economists surveyed by The Wall Street Journal had expected 180,000 new jobs and a 4.1% unemployment rate in December. Revised figures show employers added 252,000 jobs in November and 211,000 in October, for a net downward revision of 9,000.
read more: WSJ
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