Mortgage Comparison Shopping

The Federal Reserve has proposed a new rule that may make it easier for prospective homeowners and those looking to refinance shop around before making a commitment.

The proposal, which was part of a 930-page document published mid-month in the Federal Register, would allow consumers to cancel mortgage applications within three days and get refunded for certain costs.

Things like application fees and appraisal fees would be refundable, while credit report fees would not.

Mortgage shoppers would be entitled to refunds if they canceled an application within three business days of receiving key disclosures, including the Good Faith Estimate and Truth in Lending Act statement.

The Fed believes such a rule would help consumers shop for the best deal, instead of being locked in with one mortgage lender for fear of losing any up-front costs.

But many lenders believe the rule will have little effect, as most already wait several days before charging any fees.

Others are concerned it could delay an already backed-up process, as there will be a waiting period before anything is acted upon or ordered.

Although, it’s not uncommon for a loan to be “on hold” until it makes it through underwriting and receives a formal decision.

It’s unclear how the rule would affect mortgage brokers, those who work on behalf of banks directly with consumers.

A recent Bankrate.com study found that mortgage closing costs rose more than 36 percent this year, with loan origination fees rising nearly 25 percent and third-party fees jumping almost 50 percent.


I am an actual person so if you are interested in refinancing you can receive real time quotes and payment options by calling me directly. You can reach me, Gene Neal at 877-276-6400 Ext 101.

"Highly Affordable"

Housing affordability remained near its highest level on record for the sixth consecutive quarter, according to the latest survey from the National Association of Home Builders.

The National Association of Home Builders/Wells Fargo Housing Opportunity Index (HOI) indicated that 72.3 percent of all new and existing homes sold during the second quarter were affordable to families earning the national median income of $64,400.

That’s up slightly from the first quarter and just shy of the record-high 72.5 percent seen in the first quarter of 2009.

Before 2009, the affordability index rarely topped 67 percent, and had never reached the 70 percent-mark.

But record low mortgage rates and falling home prices have opened the door for more buyers, less the tighter underwriting environment.

Kinda makes you wonder why no one is interested in buying a home these days – maybe affordability isn’t the driver.

After all, a ton of buyers pre-mortgage crisis couldn’t even afford to make their mortgage payments in the conventional sense, so they opted for mortgage programs with teaser rates like the option arm.

Perhaps they were more interested in the thought of home price appreciation, as opposed to simply living in a home.

Syracuse, NY Most Affordable Housing Market

The most affordable major housing market in the country was Syracuse, NY, pushing Indianapolis-Carmel, IN off the top spot, which it held for almost five years.

Nearly all (97.2%) of the homes sold there were affordable to households earning the median family income of $64,300.

Detroit, Youngstown, and Buffalo also made the list of the most affordable metros.

Meanwhile, the New York-White Plains-Wayne, NY-NJ area continued to be the least affordable major housing market during the second quarter, with just 19.9 percent of all homes sold deemed affordable to those earning the median income of $65,600.

Los Angeles, the Bay area, and Honolulu continued to linger at the bottom of the affordability scale during the quarter as well.

I am an actual person so if you are interested in refinancing you can receive real time quotes and payment options by calling me directly. You can reach me, Gene Neal at 877-276-6400 Ext 101.

Countrywide Customers Eligible for Free Credit Monitoring

If you provided personal information to or made mortgage payments to Countrywide Financial before July 1, 2008, you may be eligible for free credit monitoring for two years.

The ruling is part of a settlement finalized today by U.S. District Judge Thomas B. Russell of Paducah, who oversaw more than 36 lawsuits related to a security breach at the company.

The lawsuits are tied to the arrest of former Countrywide employee Rene Rebollo Jr., who was a senior analyst for the company.

Federal investigators claim Rebollo used a flash drive to download personal data from roughly 20,000 customers a week for two years from 2006 through August 2008.

The data included sensitive information ranging from birth dates and social security numbers, to mortgage and credit card information.

He later sold the seemingly valuable data to another defendant, Wahid Siddiqi, for just $500 and the pair earned a combined a $50,000 through sales to third parties, likely mortgage lead companies and similar entities.

Bank of America, which now owns the defunct mortgage lender, denied any wrongdoing, but said a settlement would help the company avoid additional expenses and litigation.

Former Countrywide customers who are able to prove their identity was “stolen” as a result of the breach are eligible for up to $50,000 in compensation for each offense.

The deadline to subscribe for free credit monitoring (Triple Advantage by Experian) is September 7, 2010 – the earliest deadline to file a claim for monetary compensation is October 18.

I am an actual person so if you are interested in refinancing you can receive real time quotes and payment options by calling me directly. You can reach me, Gene Neal at 877-276-6400 Ext 101.

Soon but not yet....

Last week, Federal Housing Administration (FHA) commissioner David Stevens announced plans for implementing FHA's new mortgage insurance premium structure. Based on industry feedback to the announcement, the FHA postponed the premium fee changes on all new case numbers for one month, and will now implement them on Oct. 4, 2010.

"Over this past week, the industry responded with support of the new fee structure, but voiced strong concern about having system changes ready in time to meet the original Sept. 7, 2010 deadline," said US Housing and Urban Development (HUD) deputy assistant secretary Vicki Bott. "Since these system changes impact regulatory disclosures, lenders expressed they must have the additional time to implement and test systems. FHA took this feedback seriously and has accommodated the need for additional time."

FHA will lower its upfront premium simultaneously with the increase to the annual premium. FHA's upfront mortgage insurance premium will be adjusted down to 100bps on all amortization terms and the annual mortgage insurance premium will increase to 85-90 bps on amortization terms greater than 15 years.

The Senate last week approved its version of HR 5981, which allows the FHA it to hike its annual premiums for its single-family program. It allows the FHA to raise its annual mortgage insurance, raising the statutory cap rate to 1.55% from 0.55% — a flexibility that the industry and the FHA says could ultimately reduce the cost of credit insured by the FHA.


I am an actual person so if you are interested in refinancing you can receive real time quotes and payment options by calling me directly. You can reach me, Gene Neal at 877-276-6400 Ext 101.

Cash-In Refinances Rise in Latest Quarter

During the second quarter, 22 percent of homeowners who refinanced their mortgages lowered their principal balance by bringing in additional money at closing, Freddie Mac reported today.

It was the third highest “cash-in refinance” share since Freddie Mac began keeping records on refinancing trends since 1985.

Cash-in refis (which are basically rate and term refis) increased from 19 percent in the first quarter, but were nowhere near the 36 percent share seen in the final quarter of 2009.

Meanwhile, cash-out refinances, where the original loan amount increased by at least five percent, represented 27 percent of all refinance loans.

Over the past three quarters, cash-out refinancing has been at its lowest since Freddie began tracking in the 80s.

The main cause of decline was harsher underwriting guidelines for loan-to-value ratios, coupled with reduced home prices.

In fact, the median appreciation of the collateral property was a negative five percent over the median prior loan life of four years.

Compare that to 20-30+ percent positive appreciation during the boom years in the mid-2000s, and you’ll know why everyone refinanced their mortgage (with cash-out).

Just $8.3 billion in home equity was pulled out during the second quarter, down from $8.4 billion in the first quarter and the lowest amount since 2000.

I am an actual person so if you are interested in refinancing you can receive real time quotes and payment options by calling me directly. You can reach me, Gene Neal at 877-276-6400 Ext 101.

Applicationrs Rise....Are you taking advantage?

Home loan application volume increased 7.6 percent on a seasonally adjusted basis for the week ending July 16, the Mortgage Bankers Association said today.

Refinance applications increased 8.6 percent week-to-week to the highest level since the week ending May 15, 2009.

The increase was led by a 10.7 percent rise in conventional refinance applications, offset by a 4.2 percent decline in government refinance apps.

“As rates on 30- and 15-year fixed-rate mortgages declined to the lowest levels recorded in the survey, refinance activity increased last week, said Michael Fratantoni, MBA’s Vice President of Research and Economics, in a release.

“The refinance index is up almost 30 percent over the past 4 weeks, but is still well below the peak seen last spring.”

He noted that those aiming to get the lowest interest rate are getting conventional loans, while those looking for a low down payment requirement are grabbing FHA loans.

Purchase Applications Rise

The seasonally adjusted purchase index increased 3.4 percent from a week earlier, thanks to an eight percent increase in government apps (FHA loans, VA loans).

The unadjusted purchase index was up 15.3 percent compared with the previous week (which included the Independence Day holiday), but off 35.7 percent from year-ago levels.

Interest Rates Hit New Lows

Meanwhile, the popular 30-year fixed fell to 4.59 percent from 4.69 percent, the lowest level ever recorded in the MBA’s survey, while the 15-year fixed slipped to 4.05 percent from 4.12 percent, also a record low.

Finally, the one-year adjustable-rate mortgage dipped to 7.17 percent from 7.20 percent, but clearly remains an unfavorable option.

The MBA’s weekly survey covers more than half of all retail, residential loan applications, but does not factor out duplicate or rejected apps, which have surely risen since the mortgage crisis got underway.


I am an actual person so if you are interested in refinancing you can receive real time quotes and payment options by calling me directly. You can reach me, Gene Neal at 877-276-6400 Ext 101.

Blowing up the Bank?

An Illinois man facing foreclosure reportedly attempted to blow up the bank that held his mortgage.

Last Friday at around 8 p.m., the disgruntled homeowner crashed into a PNC bank branch in his hometown of Lockport in an apparent attempt to destroy it.

The man then set off a four-inch mortar, typically reserved for fireworks shows, which blew off the roof of his car and shattered windows in the front of the bank.

Fortunately the bank was closed at the time and there were no reported injuries.

The homeowner, David Whitesell, has been charged with arson and criminal damage to property with an incendiary device, both felony offenses.

He was being held on a $30,000 bond and expected to appear in court this week.



There have been similar instances of homeowners going to great lengths to get revenge on their banks or attempt to bring their mortgages current using unconventional methods.

In February, a man bulldozed his home after the bank began foreclosure proceedings.

And last summer, another struggling homeowner robbed a bank in San Diego in order to make his mortgage payments.

He made off with $107,000 before eventually being caught.

A month earlier, a Long Island truck driver behind on his mortgage executed an elaborate fake robbery, which included telling police he was held up at gunpoint.

He eventually broke down and told police he was unable to keep up on his mortgage.

I am an actual person so if you are interested in refinancing you can receive real time quotes and payment options by calling me directly.

You can reach me, Gene Neal at 877-276-6400 Ext 101.