Freddie and Fannie Will Pay Up; Rates and Bonds Little-Changed in Q1

After gathering little attention for nearly a decade, the two GSEs, Fannie Mae and Freddie Mac are making news on several fronts. Two developments in the last few days are worth noting. The Federal Housing Finance Agency confirmed on Thursday that the two GSEs will pay their fourth quarter dividends to the Treasury as scheduled. As we reported here earlier this week, there is growing concern about the ultimate result of the net dividend sweep, in which each of the GSEs is required pay Treasury all of the previous quarter's profits, less a steadily reserving cash reserve. That reserve reaches zero at the end of this year, leaving the GSE's with no capital with which to manage any downturn in the housing market. Concern about the GSE's capital reserves sparked a letter to Treasury and FHFA from

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http://www.mortgagenewsdaily.com/reports/newsletter/2017/3/31/2719

For Rates, Once Again, It Depends; MLS and Public Records Aligned on Comps; ARMs on The Upswing

For the third day in a row, day-over-day mortgage rate movement depends heavily on the lender. That means some lenders will be in noticeably better shape vs their latest offerings from yesterday while others will now be quoting higher rates. At issue is the volatility in bond markets (which dictate mortgage rates). Moreover, the timing of the volatility over the past 3 days resulted in some lenders making late-day adjustments to rate sheets while others simply waited for the following morning. If that leads you to think of phrases like "it all comes out in the wash," you have the right idea. Looking past recent volatility, most lenders are right in line with their rate sheets from late last week. They've simply walked slightly different paths to get there. As far as markets are concerned, the

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http://www.mortgagenewsdaily.com/reports/newsletter/2017/3/30/2717

Pending Sales Surge; Time for FHA to Ease Credit; Rates Steady; Refi Share Back to 2008 Levels

Pending home sales in February surprised everyone with an unexpected jump of 5.5 percent . The National Association of Realtors® said its Pending Home Sales Index, which is a leading indicator based on signed home purchase contracts, rose to 112.3 in February from 106.4 in January. The reading is 2.6 percent above a year earlier, and surpassed index readings for every month since May 2006 with the exception of last April. Lackluster pending home sales in recent months have worried the housing industry , indicating that the spring market might be less successful than hoped. Analysts had expected pending sales to recover from their 2.8 percent downturn in January, but they undershot the market in their estimates for February. Those polled by Econoday had been looking for an increase ranging

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http://www.mortgagenewsdaily.com/reports/newsletter/2017/3/29/2715

Experian Fined for Misrepresenting Credit Scores; Rates Wait on Policy Progress

It wasn't exactly bait and switch, maybe unlawful substitution is closer to the mark. Whatever, Experian, the credit reporting company, has been handing consumers a line about their credit scoring system and CFPB caught them. The Consumer Financial Protection Bureau (CFPB) announced on Thursday Experian and its subsidiaries have agreed to a $3 million civil penalty for deceiving consumers about its own proprietary brand of credit scores. The company claimed the credit scores it marketed and provided to consumers were used by lenders to make credit decision. CFPB says, in fact, lenders do not use these scores. Credit scores are numerical summaries designed to predict consumer payment behavior in using credit. CFPB states that no single credit score or credit scoring model is used by every lender

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http://www.mortgagenewsdaily.com/reports/newsletter/2017/3/24/2707

Mortgage Rates Stumble as Political Uncertainty Weighs; New Home Sales Build on January's Strength; Arguments to Restructure CFPB

Mortgage rates were slightly higher for the first time in 8 days as markets braced for the impact of political developments. The big issue of the day was (and still is) the healthcare bill set to be debated in the House of Representatives tonight. In general, if the bill is passed, investors will be more keen to believe in the viability of other legislation more germane to financial markets (like tax cuts, other stimulus, and regulatory reform). Those "other" policy points were key reasons for the sharp move higher in rates at the end of 2016. If confidence increases , it could put the same pressure back on rates. But if investors lose confidence in the policy potential, stocks and bonds would have more motivation to move lower (as they've both been doing for the past 2 weeks). As of yesterday

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http://www.mortgagenewsdaily.com/reports/newsletter/2017/3/23/2705

Low Inventory Stifles Sales; Home Prices Slam on Brakes; Rates Slightly Lower; Volatility Looms

Mortgage rates were lower for the 7th day in a row today, further extending their push into the lowest levels of the month. At first, that positive movement was driven by relief that the Fed's rate hike outlook didn't accelerate as much as investors expected. That motivation ran its course by the end of last week. Since then, political uncertainty has been a hot button, with widespread doubt surrounding the new administration's ability to pass the new health care bill. There have been several other contributing factors driving political uncertainty, but Thursday night's health care vote is a focal point. Most media reports suggest passage is unlikely, but that a modified version of the bill might be able to clear the House. Even though the Senate would still need to vote, if any sort of healthcare

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http://www.mortgagenewsdaily.com/reports/newsletter/2017/3/22/2703

Rates Down to March Lows; Mortgage Profits Plummet; More on Zillow

Mortgage rates continued lower today as political uncertainty sparked the biggest day of stock market losses since the election. In general, short term pain for stocks benefits bonds. When demand for bonds increases, rates move lower. Today was no exception. Bond yields (which correlate with mortgage rates) fell in lock-step with stocks in the late morning hours. Today's improvement makes for a nice addition to several days of lower rates. In less than a week, rates have fallen quickly from 3 year highs to the lowest levels of the month . The average lender is still quoting conventional 30yr fixed rates of 4.25% on top tier scenarios, but with lower upfront costs today. Several of the more aggressive lenders are already back down to 4.125%, and fewer laggards remain at 4.375%. Loan Originator

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http://www.mortgagenewsdaily.com/reports/newsletter/2017/3/21/2701