NEW YORK (Reuters) — U.S. mortgage applications fell last week,
reflecting a plunge in demand for home refinancing loans as interest
rates surged to their highest levels since late January, data from an
industry group showed on Wednesday.
The Mortgage Bankers
Association said its seasonally adjusted index of mortgage
applications, which includes both purchase and refinance loans, for the
week ended May 29 decreased 16.2% to 658.7.
Tom Marano, chief
executive of mortgage operations at GMAC, said in an exclusive
interview with Reuters on Tuesday that home loan volume at GMAC is
about 75% lower now than when mortgage rates hit record lows several
months ago.
Sen. Charles Schumer is warning homeowners who are taking advantage of low mortgage rates by home mortgage refinancing that they should beware of predators.The senator says they’re the same predators who pushed subprime loans that contributed to the economic crisis.With mortgage rates at historic lows, hundreds of thousands of homeowners are eligible for refinancing in New York state alone.
The senator says misleading offers include lures such as no down payments or closing costs, limited documentation or low credit scores. But such offers, Schumer says, can come with hidden fees and clauses and floating interest rates that can wipe out any savings from the refinancing and even cost the homeowner more.
By a vote of 406-4, the House on Thursday approved the HR 5074, FHA Reform Act, a bill designed to strengthen the agency’s finances and provide a number of other reforms. One of its main provisions is one allowing the FHA to increase the annual premium it charges borrowers to a maximum of 1.55 percent of the mortgage balance.
What does it mean for us? This bill provides a tighter regulation of FHA-approved lenders. It gives the agency greater authority to investigate lenders with unusually high rates of default and withdraw certification.
The legislation is meant to address problems that emerged in the wake of the subprime mortgage crisis and provide enhanced protections for borrowers against questionable lending practices.
We’ll try to see what developments will occur in the following weeks after this bill is formally ratified.
From cnnmoney.com:
Despite all the hand-wringing and attempts to contain the foreclosure plague, the problem still spread during the first three months of 2009, as the number of foreclosure actions started hit a record high, according to a quarterly report.
The National Delinquency Survey released Thursday by the Mortgage Bankers Association (MBA), reported the largest quarter-over-quarter increase in foreclosure starts since it began keeping records in 1972. Lenders initiated foreclosures on 1.37% of all first mortgages during the quarter, a 27% increase from the 1.08% rate during the last three months of 2008 and a 36% rise from the first quarter of 2008. All told, more than 616,000 mortgages were hit with foreclosure actions.
Continue reading Troubled mortgages hit record high
