Residential

Apache is functioning normally

The Office of Federal Housing Enterprise Oversight announced today that it will lift the caps currently constraining the growth of the government sponsored entities’ mortgage portfolios.

Fannie Mae and Freddie Mac’s regulator noted that the two have been timely in releasing their financial statements and have met the requirements of their respective Consent Orders.

“Fannie Mae published its timely, audited financial statement for 2007 today and Freddie Mac anticipates publishing its statement tomorrow,” said OFHEO Director James B. Lockhart said in a statement on its website.

“These steps constitute an important milestone in remediation of their respective operational and control weaknesses that led to multi-year periods when neither company released timely, audited financial statements.”

The mortgage financiers had previously been involved in accounting irregularities that led to an investigation by the Justice Dept. and restrictions on the companies’ portfolios.

“Both companies have been operating under regulatory restrictions stemming from these past problems,” Lockhart continued.

“These restrictions include growth limits on their retained mortgage portfolios, Consent Orders prescribing necessary remediation actions, and required 30 percent capital cushions above the statutory minimum capital requirements.”

“In recognition of the progress being made by both companies, as indicated by the timely release of their 2007 audited financial statements, and consistent with the terms of the relevant agreements, OFHEO will remove the portfolio growth caps for both companies on March 1, 2008.”

The OFHEO said it is also considering a reduction to the capital cushion, noting that the GSEs are well capitalized at current levels after announcing their preferred stock offerings.

“As each Enterprise nears the lifting of its Consent Order, OFHEO will discuss with its management the gradual decreasing of the current 30 percent OFHEO-directed capital requirement,” said Lockhart.

“The approach and timing of this decrease will also include consideration of the financial condition of the company, its overall risk profile, and current market conditions. It will also include consideration of the importance of the Enterprises remaining soundly capitalized to fulfill their important public purpose and the recent temporary expansion of their mission.”

The news couldn’t have come at a better time, as Fannie Mae announced a fourth quarter loss of $3.6 billion, or $3.80 a share this morning, leading to a net loss of $2.1 billion for all of 2007.

The loss compares to a profit of $604 million in the same period a year earlier, and fell way below Thomson Financial analysts expected loss of $1.24 a share as it set aside $2 billion for bad loans.

Shares of Fannie were up 71 cents, or 2.63%, to $27.68, while Freddie climbed 32 cents, or 1.27%, to $25.53.

When the news of the portfolio caps being lifted was announced, both stocks saw multi-dollar gains, which eventually subsided.

Fannie and Freddie already own or guarantee roughly 40% of the $10.9 trillion U.S. residential mortgage market.

(photo: preciouskyhatt)

Source: thetruthaboutmortgage.com

Apache is functioning normally

TPO, Subservicing, Marketing, CRA Products; Training and Webinars; Podcast Interview with Dr. Elliot Eisenberg

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TPO, Subservicing, Marketing, CRA Products; Training and Webinars; Podcast Interview with Dr. Elliot Eisenberg

By:
Rob Chrisman

Mon, Dec 4 2023, 10:43 AM

“People would learn more from their mistakes if they weren’t so busy denying them.” Here’s a little trivia for the compliance folks in the coffee room: The CFPB handles 20,000 consumer complaints per week, and given that financing a home, and then servicing the loan, is the largest financial transaction most individuals go through, you gotta figure a chunk of the 20,000 involve mortgages. While we’re on the CFPB, Director Chopra addressed issues related to refinancing in a hearing on Capitol Hill last Thursday. But the headlines have been grabbed by interest rate improvements in our free market economy, and the economics calendar this week will be highlighted by the U.S. jobs report on Friday, arriving just five days before the Federal Reserve’s December 13 meeting. (Expect payrolls growth will rise to 200K in November from 150k job additions in October, and the unemployment rate to stay steady at 3.9 percent.) Today’s podcast can be found here, and this week’s is sponsored by nCino, makers of the nCino Mortgage Suite for the modern mortgage lender. nCino Mortgage Suite’s three core products, nCino Mortgage, nCino Incentive Compensation, and nCino Mortgage Analytics, unite the people, systems, and stages of the mortgage process. Today’s has a wide-ranging interview with economist Elliot Eisenberg on government spending, the Fed’s balance sheet, and “Eisenbergian Economics.”

Lender and Broker Products, and Services

Servicing transfers are complicated, so it is critically important that you nail down the prep work beforehand. If you don’t, and the servicing transfer goes awry, it’s not only servicers who suffer, their customers do, too. The professional services team at ICE Mortgage Technology break down exactly what’s on the line, and what happens when poorly handled servicing transfers leave customers in a lurch. Read its new blog here to learn just how “high stakes” loan transfers can be, and the steps servicers can take to avoid borrower confusion, retention concerns, and even reputational risk, before they become a problem.

Exclusive data: Maxwell Q3 2023 Mortgage Lending Report reveals trends in interest rates, loan volume, and borrower demographics. Q3 brought continued challenges for home buyers and lenders. Despite 11 Fed rate hikes over the past year and a half, interest rates averaged 7.2 percent in Q3, the highest Maxwell data has recorded within the current market cycle. Still, Maxwell’s new report, which derives insights across more than 300 lenders and $290B in loan volume, shows signs of stabilization in Q3. Motivated borrower groups found creative paths to homeownership despite adversity, flocking to remaining pockets of affordability (hint: West Virginia). For insightful market data along with actionable advice from Maxwell experts on how to form a strong 2024 strategy, click here to get your free copy of Maxwell’s Q3 2023 Mortgage Lending Report.

Community Reinvestment Act (CRA) Final Rule: Preparing Your Bank for CRA Modernization! After years of discussions and false starts, the Federal Reserve, FDIC, and OCC issued their final rule modernizing the Community Reinvestment Act (CRA) in October. The almost 1,500-page final rule will take effect on April 1st, 2024. This means banks must comply with all the rule’s provisions by January 1, 2026 (aside from certain requirements taking effect January 1, 2027). How will CRA modernization impact your bank? What do regulators hope to achieve? What are they looking for from banks? What should your bank do to prepare? In this new article, experts from Ncontracts discuss this and more, plus offer insights on how the right resources can ease these regulatory burdens. Read the full article for more information.

Variety is the spice of life, which is why ICE maintains an ever-growing library of multimedia marketing content with its Surefire℠ CRM and Mortgage Marketing Engine. Intelligently automated Blueprints for Success give lenders a leg up with effective marketing workflows without the hassles of A/B testing and complex configuration. Whether a lender launches our Blueprints for Success out-of-the-box or configures them to meet unique goals, these automated campaigns help nurture relationships, improve pull-through and power sales across the entire homeownership lifecycle. Explore how Surefire can power your sales strategy in 2024 and schedule a demo with the ICE team today.

Delinquencies have remained statistically low, but recent market data indicates an uptick in early-stage delinquencies, unemployment, and more Americans relying on credit to make ends meet, so that rate may continue to rise. Computershare Loan Services (CLS) is a highly rated subservicer that can take the heavy lifting of managing high-risk loans off your shoulders. All its services (originations fulfillment, co-issue MSR acquisition, subservicing, and its mortgage cooperative) help keep lenders one step ahead. In this industry, you deserve a partner that has it all. Contact CLS to find out how they can help you reach your goals, in any market.

Broker and Correspondent Programs

Give Your Pipeline a Boost this December with LoanStream’s Winter Specials on Non-QM and Prime! Purchase, Rate/Term & Refi Cash-Out on both. Non-QM, 50bps >65% to <= 75% LTV & 720+ FICO, 75bps >55% to <= 65% LTV & 720+ FICO, 100bps <= 55% LTV & 720+ FICO. These are only here for a limited time so take advantage and Contact your Account Executive for details. For loans locked 12/1/2023 through 12/31/2023. Restrictions apply. Interested in getting approved? Visit our Get Approved page now: Get Approved LoanStream Wholesale – Wholesale Mortgage Lending.

With the holiday season underway, Rocket Pro TPO is kicking off its December to Remember campaign by introducing a series of exciting and valuable wins throughout the month of December to celebrate and support Rocket Pro’s broker partners. On Friday, the first win was introduced: a 25 bps LLPA on 30-year fixed rate conforming VA loans that will be available all month. Check out this video message from EVP Mike Fawaz. And, today, Rocket Pro’s highly popular Fast 15 Loan Guarantee is back now through January 31st! This special offer for brokers guarantees that all eligible loans will be clear to close in 15 business days or they will pay your client $2,500. For correspondent partners, they guarantee that eligible loans will be clear to close in 15 business days, or they will waive the $999 acquisition fee. Requirements and rules apply. Partners are encouraged to watch their inboxes and Rocket Pro TPO’s social media channels for more wins to come. Interested in learning more about a Broker or Non-Delegated Correspondent partnership? Contact Rocket Pro TPO to learn more.

Events, Training, and Webinars in December

TOP CEOs DISCUSS WINNING STRATEGIES FOR THE 2024-25 MORTGAGE CYCLE. Tomorrow, 12/5, at 2 PM ET, tune into HousingWire as Sagent CEO Dan Sogorka digs into this topic with industry leader Mark O’Donovan (Chase), moderated by Julian Hebron of The Basis Point. These 3 mortgage experts will uncover how lenders can thrive through 2025 and beyond, discussing vital topics such as navigating homebuyer affordability, lender priorities, FHFA, CFPB insights, and more. Don’t miss this powerhouse session! Register here to refine your strategies for the upcoming year or catch the recording if you can’t attend live.

A good place for longer term conference planning is to start is here, and click on “events” for conferences in the future.

Tomorrow, 12/5, is the next Mortgages with Millennials with Kristin Messerli and Robbie Chrisman. Tune in every Tuesday at 1PM ET to the weekly video show designed to empower mortgage professionals to tap into the millennial market. This show demystifies the psychology of first-time homebuyers and offers strategies to win more market share with a key segment of the market. Sign up for a weekly reminder with the link to join and a sneak peek into the next episode. This week’s guest is Kayla Gatmaitan, and education-focused LO for first time homebuyers.

If business is slow and you’re looking for new opportunities, register for MBA Eastern Pennsylvania’s upcoming free session with Freddie Mac on Tuesday, December 5 at 11:00 a.m. One of the challenges homebuyers face in today’s market is saving for the down payment. In this session, the benefits and differences between two low down-payment offerings, Home Possible® and HomeOne® will be explored. Additionally, the session will cover Freddie Mac BorrowSmart AccessSM, a program that offers up to $3,000 in down payment and closing cost assistance to help your clients reach homeownership.

The title industry faces many challenges going into 2024 and October Research wants to help you prepare your business. Orrick Partner Sherry-Maria Safchuk and CATIC SVP and National Agency Manager Kyle Rank will share their expertise and address critical issues such as consumer protection, cybersecurity trends, remote online notarizations, updates on the 1033 rule and more on the latest Industry and Regulatory Outlook webinar Dec. 5th. Stay ahead of the competition and start the new year strong. Register today at DoddFrankUpdate.com.

2023 Financial Institutions Professionals Webinar Series, presented by the Bonadio Group, December 5th, 6th, and 7th at 8:00 PST. During this complimentary event, industry experts will discuss emerging issues, impacts, insights, & more. Create your own personal agenda by choosing from several sessions, each designed as a roadmap to help you navigate what’s to come in the ever-changing financial services landscape. Each session offers 1 (one) credit of CPE.

Wednesday the 6th, looking for more in-depth commentary on weekly mortgage news? Register here for “Mortgage Matters: The Weekly Roundup” presented by Lenders One. Every Wednesday at 2:00 PM EST/11:00 AM PT is a dive into a range of mortgage-related topics, including market trends, interest rate fluctuations, innovative mortgage products, and industry advancements. Listen to a unique mix of age perspective, expertise, and charisma to the screen, ensuring that the information is not only educational but also entertaining. This week’s guest is Mark Jones, President of Union Home Mortgage and Chairman of the MBA.

Join MBA St. Louis at St. Charles Realtors, Wednesday, December 6th, 8:00 am – 10:30 am, and test your knowledge on Conventional Loans. This engaging and interactive course led by Trainer MaryKay Scully, Enact MI’s Director of Customer Education will review the key areas of Credit, Income, Collateral, Liabilities, Assets, HomeReady and Home Possible. It will inform and engage participants. Assessing knowledge, while reviewing Fannie Mae and Freddie Mac guidelines, as well as Desktop Underwriter and Loan Product Adviser. Cost: $20 (covers light snacks and room rental).

Freddie Mac added enhancements to its HFA Advantage® mortgage offering, providing a competitive solution for housing professionals to consider for first-time and repeat homebuyers. In a free webinar, Thursday, December 7th, 2 p.m. – 3:30 p.m. ET, you’ll learn more about HFA Advantage’s features and benefits, eligibility and homebuyer education requirements and new product enhancements.

With a residential real estate market that continues to change and evolve, WMBA has gathered industry professionals that offer different perspectives to give real insight into “Build for Rent” model, an increasing popular approach to residential new construction being built and held as rental properties. Join WMBA for the Income Property Luncheons on Thursday, December 7th, In Person Attendees: 11:30-1:00pm, Virtual Attendees: 12:00pm-1:00pm.

Join Angel Oak Mortgage on Thursday, December 7 at 10:00 PST for a webinar detailing its Investor Cash Flow (DSCR) programs and cover the top 20 broker questions. Learn how easily these loans close and help add to the bottom line.

Success leaves clues. Not surprisingly, many of the traits shared by high achievers are common sense in theory, but not necessarily common practice (otherwise, everyone would be a high achiever, right?). Discover the keys to having your best year ever, the most important (yet often missing) part of the formula for success and disciplines you often don’t think about. Join Hannah J. Barton and Blaine Rada, CSP, to discover these habits and incorporate them into your own life. TMBA Webinar, Habits of High Achievers, Thursday, December 7 at 11:00 am – 12:00 pm.

Join LSEG Academy session Central Bank & Bond market outlook – Insight from IFR Markets,

Thursday, December 7th | 8:00 PST., as industry experts examine recent benchmark interest rate increases and likely changes to the direction of central banks’ monetary policies. They will also look at the commentary and insight provided by IFR Markets and showcase how benchmark rates have been impacting the bond and rates markets utilizing LSEG Workspace tools. The discussion will include expectations for interest rate moves in 2024 and provide an opportunity to ask questions to industry experts.

Friday, December 8, is the next episode of The Mortgage Collaborative’s Rundown covering current events in the mortgage market for 30-45 minutes starting at noon PT, 3PM ET, in “The Rundown”. Listen to Rich Kuegler with Stewart Title!

Capital Markets

As mortgage rates dropped for the fifth consecutive week last week, Federal Reserve Chair Powell said that any speculation of potential rate cuts is still “premature.” Yes, inflation is easing, and the U.S. economy is cooling with Fed policy now well into restrictive territory. The full effect of higher rates is still working its way through the economy and the central bank has noted progress against inflation over the past six months. The hiking cycle is likely over, but the Fed is reluctant to admit as much or discuss any sort of rate cuts.

Economic data over the last week continued to show the U.S. economy is still expanding while inflation trends lower. Real GDP was revised up to 5.2 percent in the second update from 4.9 percent in the advance update. Consumer spending on services increased 0.2 percent in October and spending on nondurable goods increased 0.3 percent. The October PCE deflator was unchanged in October and showed prices were 3.0 percent higher than twelve months ago; the lowest annual reading since March 2021. While prices are still rising faster than the Fed’s preferred rate, the pace continues to slow and bodes well for a soft landing for the U.S. economy.

This can also be seen in housing prices which rose 0.7 percent in September and 3.9 percent from one year ago, according to the S&P CoreLogic Case-Shiller Home Price Index. While elevated mortgage rates helped the slowdown, limited available for sale inventory has kept prices from outright declines. As a result of the continued progress on inflation and recent Fed comments around being well into restrictive territory, the markets expect the Fed is done hiking and will begin to cut rates in 2024.

This week’s economic calendar contains several higher tiered releases including the November payrolls report and preliminary December consumer sentiment on Friday. Between now and then, we will receive ISM Services for November, some labor market indicators, wholesale trade, and consumer credit. The week kicks off with just factory orders for October, due out later this morning. We begin Monday with Agency MBS prices roughly unchanged from Friday evening, the 10-year yielding 4.25 after closing last week at 4.23 percent, and the 2-year at 4.61.

 Download our mobile app to get alerts for Rob Chrisman’s Commentary.

Source: mortgagenewsdaily.com

Apache is functioning normally

Every few months over the last two years, a sea of California carpenters has clogged the state Capitol to voice their support of high-profile housing legislation, their yellow and orange vests, hard hats and work boots in stark contrast to the suits, dresses and fancy shoes more customary in the hallways and hearing rooms of Sacramento.

Their grassroots lobbying has paid off with major legislative wins, including a pair of housing construction bills that Gov. Gavin Newsom signed into law Wednesday.

The laws represent more than the possibility of desperately needed new homes in a state with a 2.5-million-unit housing shortage. They also signal a shift in power dynamics among unions in California, and which ones have the greatest influence over labor standards at residential construction sites.

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“The carpenters’ engagement on housing policy has been an absolute game changer,” said state Sen. Scott Wiener, a San Francisco Democrat who chairs his chamber’s housing committee and is the author of both laws, Senate Bills 4 and 423.

The first bill, SB 4, will make it easier for nonprofit colleges and faith organizations to build affordable homes on their land, while SB 423 will expand current law that lets developers expedite construction of multifamily projects in cities that have fallen behind on their state-mandated housing goals. The measures build on Assembly Bill 2011, a law that went into effect in July to convert buildings traditionally zoned for commercial retail and office space into affordable housing.

The new laws come after years of gridlock on housing proposals, leading to a rift between the California Conference of Carpenters, which is gaining newfound clout in the state Capitol, and the State Building and Construction Trades Council, one of the most influential players in Sacramento over the last decade.

Divisions bubbled up last year when the carpenters broke with the council and other influential unions and sponsored AB 2011, legislation the broader labor movement opposed because it lacked more rigorous job standards.

AB 2011 still mandates developers pay union-approved, or “prevailing,” wages and provide some healthcare benefits to workers, whether they’re union members or not. But it lacks the work standard the building trades union prefers, known as “skilled and trained,” a mandate that generally means laborers on job sites are unionized.

In the Democratic-controlled Legislature, where labor has an outsize influence, last year’s union infighting put many lawmakers in the uncomfortable position of having to choose a side.

Opponents of the skilled and trained standard argue it’s unachievable for housing developers because there aren’t enough union workers to meet the threshold. The trades union contends it’s a model that protects workers against exploitation and inadequate job safety protections.

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“I think that prevailing wage in legislation for housing is a positive step,” said Chris Hannan, who was selected president of the State Building and Construction Trades Council this summer. “We don’t believe that that’s enough.”

Hannan succeeded Andrew Meredith, who resigned as president this year as the fight over labor standards raged in the Capitol.

Leadership at the carpenters union say they had no choice but to move forward with their own plan after discussions with the council fell apart.

Jay Bradshaw, executive secretary-treasurer of the Northern California Carpenters Union, said the new standards will help dismantle the underground construction economy and create job opportunities for union members, while safeguarding all workers against wage theft and other unfair labor practices currently happening on residential job sites.

The carpenters’ approach with the new standards is to organize members on job sites, but the trades council historically preferred requiring a unionized workforce to begin with.

“The labor standards we developed will significantly help our current membership. … And it will also pull wages out of competition for those that are not represented,” Bradshaw said. “And then it’s our job to go organize those folks, not the government’s.”

Todd David, a political advisor to Wiener who served as executive director of the Housing Action Coalition in 2022, said the increased influence of the carpenters helped clear a path for new housing legislation.

“There were lots of quiet conversations between legislators with people who knew the carpenters very well, like, can they really do this?” David said.

They did.

So began a new era for the carpenters — and their Democratic allies eager to pass more sweeping housing bills into law using the same labor language.

“They showed up, and they really planted a flag in AB 2011,” said Assemblymember Buffy Wicks, the Oakland Democrat who wrote the legislation and chairs the Assembly committee on housing. “It was a breakout moment, I think, for the carpenters, where they decided enough is enough, we’re going to build housing, we’re going to do strong labor standards, we’re going to break the juggernaut that has been preventing us from actually accomplishing stuff in California in housing policy, with regards to labor standards. And they did it.”

The building trades council and its allies see the fight as far from over.

Hannan and others still consider the dispute over the labor language an easy choice between protecting workers or leaving them vulnerable to exploitation and job safety issues that may result from a lack of training.

“Our members … are the very best at what they do. And they deserve us to fight as hard as we can for them,” Hannan said. “And we believe we are going to be the strongest, loudest voice for the construction worker.”

But the council lost its second battle this year after Wiener introduced his two bills, which largely include the same labor standards as last year’s deal.

Considered this year’s most consequential housing measure, SB 423 will extend by another decade current policy that lets developers streamline multifamily development in cities that have failed to plan for enough housing, which was set to expire in 2026. The original law passed in 2017 and has led to more than 18,000 proposed units, the majority for low-income families.

Last year’s coalition included the California Housing Consortium and other affordable housing groups and two other major unions — the California School Employees Assn. and the Service Employees International Union. This year, Wiener and the carpenters expanded support for the labor changes to add more construction unions.

“We just hung tough, and I think the nature of the crisis sort of forced people to do what they were not comfortable doing in terms of the labor issues,” said Danny Curtin, director of the carpenters conference. “Breaking ranks, or however you want to put it, is never simple or easy. And you don’t want to do it unless you really think there’s no real alternative. But it was unassailable, our bill was unassailable.”

Others don’t see it that way.

Scott Wetch, a lobbyist who represented several unions in the negotiations, described SB 423 as an undemocratic law that would come back to haunt every legislator who voted for it, a “political aneurysm” that “one day will burst.”

He criticized how housing might get built in a streamlined capacity that edges out community input, and questioned whether the healthcare requirements will withstand future legal challenges.

And while some unions were going to bat for their members fighting for more rigorous job rules, Wetch said, others, like the carpenters, “sold their members down the river.”

“The carpenters went to a handful of developers, and said to them, ‘Hey, we want to get some work, we want to work with you, and we will be the Judases that remove these worker protections that you don’t like, because we want to get some work out of you,’” Wetch said.

The carpenters have shrugged off those criticisms. They see the issue as a done deal, the new labor standards now the blueprint for housing legislation in California.

“The carpenters would rather be problem solvers than just problem fighters,” Bradshaw said.

Source: latimes.com

Apache is functioning normally

The latest baseline increase in conforming loan limits has enabled loan originator Dave Krichmar’s client to make a 5% down payment instead of 10%.

The self-employed homebuyer found an $800,000 home in Texas, but with the conforming loan limit for 2023 being $726,200, the buyer needed a jumbo loan or a bank statement loan. Those loan types would require a larger down payment of at least 10% of the home’s value, or $80,000, which would stretch his budget too thin.

“With the latest Federal Housing Finance Agency (FHFA) announcement, he could qualify for a conforming loan paying a 5% down payment of roughly $40,000 rather than $80,000 – which could have put him on the sideline. Now he is off the sideline because a 5% down payment is completely doable,” said Krichmar, a mortgage banker at Legend Lending Corporation. 

Based on annual changes to an index of national home prices, conforming loan limits for mortgages backed by Fannie Mae and Freddie Mac on one-unit properties will be $766,550 in 2024. For high-cost areas, the loan limit is $1.149 million.

Rising home prices also prompted the Federal Housing Administration (FHA) to adjust its loan limits — with the “floor” FHA loan limit for one-unit properties increasing to $498,257 in most parts of the country.

The increases in conforming and FHA loan limits will help certain homebuyers,  including younger buyers with little cash saved and a small window of borrowers who were on the cusp of not being able to apply for an FHA or conventional loan due to lower floor FHA loan limits or baseline conforming loan limits.

“By increasing the maximum loan amount, the change means that more borrowers will be able to get conforming loans instead of jumbo mortgages, which often are harder to qualify for. It might open the door for homeownership just a touch wider for a few buyers who would have had trouble securing jumbo loans,” said Holden Lewis, a home expert at NerdWallet.

Who benefits from higher loan limits?

The latest increases in the FHA loan limits will move the needle a little bit, noted John Palmiotto, chief production officer at The Money Store.

“It can squeeze them into maybe a better property than they previously could [afford] so there’s a bit of an opportunity there,” Palmiotto said.

Amid a high interest-rate environment, FHA loans have become a popular option for borrowers who have lower FICO scores or need to qualify with a slightly higher debt-to-income (DTI) ratio. 

Mandatory mortgage insurance premiums were reduced to 55 basis points (bps) for most borrowers in February, and FHA loans tend to come with lower interest rates than conventional loans while the difference in interest rates could often be offset by the greater number of fees — including the MIP charges

Demand for FHA loans has risen over the past year to comprise 26.3% of all new-home purchase applications in October 2023, the highest share of FHA new-home purchase applications made in a decade, according to the Mortgage Bankers Association (MBA).

Millennial homebuyers — about 28% of all buyers — who don’t have as much cash saved to be able to buy at a higher price point will benefit most from higher FHA loan limits.

“They will be more comfortable than the baby boomer generation taking out a larger mortgage to get what they want. They’ve seen massive real estate appreciation; they’ve seen it as a great investment vehicle,” Palmiotto noted.

The increase in conforming loan limits are also expected to help some borrowers who would have otherwise needed a jumbo mortgage. 

“A lot of people shop for homes based on a price range. So they’re able to just push a little bit further towards what they want, which may be doable,” Krichmar said. 

“I’m in the San Francisco/San Jose/Oakland area in California, so we have the high balance conforming loan limit as well, which is going up to $1.149 million. For sure, that will help a lot of people who might not be qualified for [a] jumbo [loan]. Some people don’t have the ability to put up to 20% down,” said Brady Thomas, branch manager at American Pacific Mortgage.

How higher loan limits might move the housing market needle

Economists at Fannie Mae project home prices to increase by 2.8% on an annual basis in 2024. Meanwhile, economists at Capital Economics are expecting an annual increase of only 1.5% next year. 

The MBA has a more optimistic view on home prices, expecting a 4.1% increase. 

The FHFA’s increase for conforming loan limits in 2024 follows a formula that tracks increases in national home prices. The FHFA cited an average 5.56% increase in home prices across the country from the third quarter of 2022 to the third quarter of 2023. 

But 2024’s higher conforming loan limits should enable more homebuyers to take advantage of conventional financing in 2024, noted Peter Idziak, senior associate of residential mortgage law firm Polunsky Beitel Green.

“I expect the increase in conforming loan limits will provide support for continued appreciation in home prices as more potential homebuyers are able to take advantage of federally-backed financing. In non-high cost areas, this support should be especially evident in the $725,000 to $955,000 price range, which roughly corresponds to the 95% to 80% [loan-to-value (LTV)] ratios based on the new limits,” Idziak said. 

However, loan originators and housing professionals are skeptical the new changes will move the needle much to resolve widespread affordability issues.

“It’s not a big enough movement that it’ll draw that amount of attention. What price range is it affecting? It’s only affecting someone who was wanting to buy an $800,000 home but could only buy a home of $750,000. That’s a small window. For somebody who’s buying a $1 million home and $600,000 home, it’s not making a drastic change,” Krichmar said.

It’ll help around the edges, allowing people to buy at lower down payment amounts who normally wouldn’t be able to with a down payment for jumbo loans of at least 10% and as much as 20% of the home’s purchase price.

The heightened limits enable a larger pool of prospective homebuyers to secure financing with more favorable terms, which could potentially sustain housing demand and market activity, said Orphe Divounguy, senior macroeconomist at Zillow Home Loans.

“Nevertheless, the overall impact remains contingent on various economic factors, interest rate trends and localized housing dynamics.” Divounguy added.

For affordability to improve and homeownership to expand, mortgage rates will have to come down. Current high rates are creating an inventory lock-in effect because sellers with existing low-rate mortgages don’t want to give those loans up for a much higher rate on another property.

“I think rates will have a big impact because, one, they affect buyer affordability, and two, they affect inventory. So I don’t think that the increase that FHFA announced […] is going to have a huge impact because it was already expected and kind of part of [how] our market works,” Thomas said.

Source: housingwire.com

Apache is functioning normally

Tennessee is a hidden gem in the Southeast United States, known for its vibrant music scene, delicious food, and beautiful landscapes. However, one often overlooked aspect is the affordability of living in the Volunteer State. Particularly for renters, there are various cities in Tennessee that offer low costs of living without compromising on quality of life. Seymour, Union City, Clinton, Crossville, and Kingsport exemplify this balance, offering affordable rents, along with access to amenities and facilities that make them attractive places to live. Now, let’s delve into what each of these cities has to offer.

Seymour, TN

Seymour, with a population of 15,444, is a peaceful and affordable place to live in Tennessee. Besides its relatively low median rent of $615 for a two-bedroom property, Seymour also boasts a substantial median income of $61,490. This makes it a great place to live and save money. The city is conveniently located between Knoxville and Sevierville, offering easy access to the attractions and amenities of both regions. The nearby Chapman Highway also provides fast and easy access to surrounding areas. Seymour’s residential appeal is further complemented by its local parks and amenities, making it an attractive and affordable place to live.

Union City, TN

Union City, despite its smaller population of 10,426, is another affordable location in Tennessee, with its median rent for a two-bedroom dwelling at $850. Here, you can enjoy a wide range of amenities and recreational activities. The city is home to Discovery Park of America, a world-class museum and park with exhibits spanning fields like history, science, art, and much more. In terms of transportation, Union City is served by State Routes 5, 22, and 216, making travel within and beyond the city convenient.

Clinton, TN

Clinton, with a population of 10,006, offers its residents reasonably priced housing with a median rental rate of $825 for a two-bedroom home. The city offers a rich history, with numerous historic sites and museums, such as the Museum of Appalachia and the Green McAdoo Cultural Center. Moreover, Clinton’s location near Andersonville Highway and Interstate 75 makes commuting and traveling an ease, further enhancing its appeal to renters looking for affordable accommodations.

Crossville, TN

Crossville is a modest-sized city of 11,704 residents, where a two-bedroom home typically rents for $820. Home to the Cumberland County Playhouse, one of the state’s largest professional theaters, and the stunning Cumberland Mountain State Park, there’s plenty of entertainment and outdoor activities for residents to enjoy. Accessible via Interstate 40 and U.S. Route 70, Crossville is a convenient and affordable location to call home.

Kingsport, TN

Kingsport, with a sizable population of 53,699, offers a median rent of $845 for a two-bedroom home. Known for its outdoor amenities, Kingsport is home to Bays Mountain Park and Planetarium providing hiking, biking trails, and wildlife viewing opportunities. Further, it is part of the Kingsport-Bristol metropolitan area, lending it big-city advantages while maintaining its small-town charm. Its location via Interstate 26 also makes for easy commutes, increasing its desirability as an affordable place to live.

Methodology

The cheapest cities in each state were ranked based on its median home price and median asking rents for studio, one-, two-, and three-bedroom units. Prior to ranking, inputs were normalized, and weights were applied using a 1.25:1 ratio of asking rents to home prices.
Data on home prices are from the U.S. Census 2016-2020 American Community Survey 5-year estimates. Data on asking rents are from Rent.
Cities without data for one- or two-bedroom asking rents or a population of less than 10,000 were removed from this ranking. Any other missing values were zeroed and did not impact the final score.

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JACKSON, MI – Since it began six years ago, Jackson nonprofit SOAR Café and Farms has strived to heal and house women who experienced trafficking, incarceration, addiction or abuse.

SOAR, which stands for “She Overcomes And Rises,” will look to fulfill that mission in a new home, with plans to transform the former Anna’s Gifts & Décor building, 401 N. Mechanic St., into a cafe, CEO and Founder Michelle Cochran said.

“It’s going to be a mentoring cafe because we’re going to be coaching ladies through employment of the cafe, and helping them gain more freedom and get back to sustainability,” Cochran said.

SOAR has operated out of the former Woman’s City club building at 300 S. Brown St., to house some women in need of services since 2019. Moving into a new facility will allow SOAR to support these women in other ways, such as employment and mentorship.

Related: Historic Jackson house renovated for women who have survived abuse

Anna’s Gifts & Décor, which closed at the beginning of 2023, offered a small cafe in the front of the store called Anna’s Porch Café, which shut down in 2021.

The building was purchased by Cornerstone Properties of Mid-Michigan’s owner Mary Garcia, who is also a SOAR board member. Garcia purchased the building with the intent to lease the facility to the nonprofit, she said.

“SOAR is a passion project for me,” Garcia said. “I’ve seen the success of the program, and if I can make a small contribution to continue that and expand that beyond just the residential program, it was always Michelle and mine’s vision.”

Related: ‘Nobody responded.’ Unanswered job listing forces Anna’s Porch Café to close after 23 years

Residents of SOAR, or even women in the community living with similar circumstances, will be able improve their work skills, make connections with the community and build their resumes by operating the cafe.

Eventually, it is the hope of Cochran to see the women outgrow it and move into the workforce.

“They (can) work there as long as they need or want to,” Cochran said. “When they are done getting the skills and education they need there, they move on to bigger and greater things and more ladies come and take their place.”

Once open, SOAR would like to serve a farm-to-table style menu with breakfast and lunch options. They are also hoping to incorporate a few items from the former Anna’s Porch Café’s menu, she said.

SOAR will also offer closed off sections for groups and meetings, a grab-and-go section, some retail space and some membership cubicles in the 10,000 square foot facility, Cochran said.

Proceeds from the cafe will go toward continuing to run Soar’s programs and the cafe, Cochran said.

Some renovations need to take place before this dream comes true. The cafe portion of the building will be relocated to the center of the store, and the porch will be transformed into cubical spaces.

The nonprofit is fundraising to purchase furniture, equipment and appliances with a goal of $90,000. People can donate to this effort through the SOAR website.

Construction will likely start in January, with a targeted completion of May of 2024, Garcia said.

Cochran is looking forward to offering a cafe inside of this location again, as well as offering women the place to grow and learn skills, she said.

“We’re excited about serving the community and serving the women we serve,” she said.

More information and updates can be found on SOAR’s Facebook page.

Want more Jackson-area news? Bookmark the local Jackson news page or sign up for the free “3@3 Jackson” daily newsletter.

Source: mlive.com

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Your ideal Indiana apartment awaits.

In this brief exploration of the cheapest places to live in Indiana, we delve into the unique aspects that make certain cities stand out as ideal havens for those on a tight budget. From accessible housing markets to economic diversity, each city on this list presents distinctive features that contribute to a cost-effective and comfortable lifestyle.

Join us as we uncover the hidden gems and economic advantages that make these places not only the most affordable cities, but also enriching for residents seeking financial stability.

Bloomington stands out among the most economical towns to call home in Indiana. Its cost-effective appeal is anchored in several key factors. Firstly, the city maintains a relatively low overall cost of living, encompassing affordable housing options and reasonable utility expenses. Beyond that, Bloomington offers accessible public transportation, minimizing commuting costs for residents on a budget.

The presence of Indiana University contributes to the city’s economic dynamic, fostering a competitive job market with opportunities for part-time and entry-level positions in the university itself. This aspect can be particularly advantageous for individuals seeking employment without compromising their financial constraints.

Grocery and everyday necessities are reasonably priced in Bloomington, allowing residents to manage their budgets more effectively. Additionally, the city’s commitment to green spaces and outdoor activities provides affordable recreational options, promoting an active lifestyle without significant expenses.

Fort Wayne offers affordable housing options, ensuring that individuals and families can find the best home price and right spot that aligns with their financial situation. The cost of living in Fort Wayne is notably reasonable considering the amenities that the city provides.

Ample job opportunities in Fort Wayne contribute to the income ratio and significantly to its affordability. The city boasts a diverse employment landscape with a range of industries, providing residents with various options for securing a comfortable income.

Furthermore, Fort Wayne prioritizes accessible and budget-friendly community facilities. The city’s commitment to parks and open spaces allows residents to enjoy outdoor activities without incurring significant expenses.

Hammond’s housing market is characterized by reasonable prices, ensuring that individuals and families can find cost-effective living arrangements that meet their financial needs.

One notable advantage of living in Hammond is its strategic location, providing easy access to neighboring cities and employment opportunities. This accessibility enhances the potential for securing affordable employment options, contributing to residents’ financial stability.

Additionally, Hammond’s strong food scene is full of affordable dining options, allowing residents to explore the world of various cuisines without breaking the bank. This culinary diversity adds a unique flavor to the city, providing residents with plenty of budget and family-friendly dining experiences.

One distinct advantage of affordable living here in Lafayette is its proximity to educational institutions and attractions. The presence of Purdue University provides opportunities for budget-friendly educational and cultural experiences, including lectures, events and performances that enhance overall quality of life for residents on a tight budget.

The city’s commitment to green spaces and outdoor activities is another notable aspect. Lafayette boasts well-maintained parks and communal spacess that are not only easily accessible but also contribute to a healthy and active lifestyle without significant expenses.

Lafayette’s local economy, supported by a mix of industries, presents residents with varied job opportunities, promoting financial stability for those seeking employment within their budget constraints.

One distinctive advantage of renting in South Bend is the city’s commitment to supporting a healthy lifestyle. Well-maintained parks and outdoor facilities not only provide residents with affordable leisure options but also contribute to a more active lifestyle without additional costs.

South Bend’s proximity to the University of Notre Dame is a notable aspect, offering potential renters access to educational and community resources without straining their budgets. The university’s presence enriches the local atmosphere and provides opportunities for affordable entertainment and intellectual experiences.

The city’s transportation infrastructure is another cost-effective aspect for renters. South Bend’s accessible public transportation system minimizes commuting expenses, allowing residents to navigate the city conveniently without a significant financial burden.

One notable advantage for renters in Evansville is the city’s affordable utilities and lowest cost of living expenses. Lower utility costs contribute significantly to the overall affordability of renting in the area, allowing residents to manage their monthly expenses more effectively.

Evansville’s commitment to community services and rec facilities is another key aspect. The city is home to a number of parks, affordable outdoor activities and open green spaces that contribute to a high quality of life for renters seeking budget-friendly leisure options.

The local job market in Evansville is full of employment opportunities, ensuring renters have access to a range of options that align with their skills and qualifications. This economic diversity supports financial stability for individuals seeking employment within their budget constraints.

One distinctive advantage for renters in Kokomo is the city center’s affordable cost of living. Lower living expenses, including utilities and everyday necessities, make it a particularly attractive and affordable place for those seeking to manage their monthly budgets effectively while renting.

Kokomo’s community focus is another noteworthy aspect, as the city prioritizes local events and affordable activities. Residents have access to safe parks, community spaces and budget-friendly entertainment options.

The city’s strategic location and ease of transportation contribute to its appeal for budget-conscious renters. Kokomo’s accessible transportation infrastructure minimizes commuting costs and enhances convenience for residents navigating the city on a budget.

Muncie is home to Ball State University, providing renters with access to affordable educational and cultural experiences. Renters on a budget can attend events, lectures and performances at ball state university without significant financial strain.

Muncie has a great secondhand market scene, from thrift stores to community markets. This allows budget-conscious renters to furnish their homes, update their wardrobes and meet their daily needs at a fraction of the cost compared to new items, contributing to significant savings.

Muncie boasts a variety of budget-friendly local eateries and diners. Residents can enjoy unique culinary experiences without breaking the bank, thanks to the city’s affordable dining options that cater to various tastes and preferences.

One noteworthy advantage for renters in Gary is the city’s strategic location. Positioned near major highways and transportation hubs, Gary facilitates easy access to neighboring cities, providing residents with diverse employment opportunities. This accessibility enhances the potential for renters to find jobs that align with their skills and financial needs.

Gary’s commitment to green spaces is another unique aspect that caters to individuals on tight budgets. The small city also maintains well-kept parks and outdoor areas around town that not only provide residents with affordable recreational options but also contribute to a healthier lifestyle without the need for expensive memberships or facilities.

Moreover, Gary’s local initiatives for affordable community services, like healthcare clinics and assistance programs, help renters manage their basic needs without incurring significant costs. This focus on community support services contributes to an overall more sustainable and budget-friendly living experience.

One distinctive advantage for renters in Terre Haute lies in the city’s commitment to green spaces and outdoor activities. With a ton of parks, hiking nature trails and public use areas, residents can do as they please in the great outdoors.

The city’s proximity to Indiana State University adds a unique dimension for Terre Haute renters on a budget. Access to the university’s educational resources, including libraries and events, provides affordable opportunities for personal enrichment, further enhancing the overall living experience.

Find your affordable Indiana apartment today

In the heart of the Midwest, Indiana unfolds as an area full of affordability, with cities like Terre Haute, Muncie and Gary providing distinct advantages for individuals seeking budget-friendly living in affordable places.

As we conclude our exploration of the cheapest places to live in Indiana, it becomes evident that these cities and towns not only prioritize financial sustainability but also offer a rich tapestry of experiences for those seeking to thrive within their means.

The most expensive places to live in Indiana

Known for its affordability, Indiana also houses pockets of opulence in certain areas where the cost of living is notably higher. In cities like Carmel, a northern suburb of Indianapolis, and Zionsville, residents experience a lifestyle marked by upscale amenities and a high standard of living. The housing market in these areas is characterized by luxurious homes and exclusive neighborhoods, contributing significantly to the elevated cost of living. With top-tier schools, large parks and upscale shopping and dining options, these suburbs attract those seeking a more affluent residential experience.

Another noteworthy enclave of affluence is located in Fishers, an Indianapolis suburb that consistently ranks among the most prosperous places to live in the state. The city’s planned communities and upscale developments contribute to a higher cost of housing and the meticulously manicured neighborhoods reflect a commitment to providing residents with an elevated living experience. The presence of high-end shopping centers, gourmet restaurants and exclusive recreational facilities adds to the allure of Fishers as a haven for those who can afford the finer things in life.

In the southern part of the state, Newburgh is renowned for its picturesque riverfront properties and upscale residences. The town’s charming ambiance, historic architecture and waterfront views contribute to the premium living experience that comes with a higher price tag. While these areas represent some of the most expensive places to live in Indiana, they also showcase the diversity within the state and population, catering to residents who prioritize luxury and exclusivity in their residential choices.

Your ideal Indiana home awaits

Whether you’re looking for a budget-friendly apartment or a large house on the water, you can find the right place in just a few clicks today.

Source: rent.com

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The delinquency rate for mortgages on one-to-four unit residential properties climbed to 5.82 percent of all outstanding loans in the fourth quarter on a seasonally adjusted basis, up 0.87 percent from the same period a year ago and 35 basis points from the third quarter, the Mortgage Bankers Association said today.

The MBA’s National Delinquency Survey also found that 2.04 percent of outstanding loans were in the foreclosure process, up 0.85 percent from a year ago and 0.35 percent from the third quarter.

That marked an all-time high, while the total delinquency rate reached its highest point since 1985.

The survey revealed that the mortgage crisis is all encompassing, and not just a subprime issue, but rather an adjustable-rate mortgage crisis.

Since the fourth quarter of 2006, foreclosure starts on prime ARMS increased to 1.06 percent from 0.41 percent, while foreclosures tied to subprime ARMS rose to 5.29 percent from 2.70 percent.

Conversely, foreclosure starts tied to prime fixed mortgages rose just six basis points to 0.22 percent over the last year, while subprime fixed loans experienced a foreclosure start rate of just 1.52 percent, up from 1.09 percent a year ago.

The MBA also found that 42 percent of foreclosures started during the fourth quarter were tied to subprime ARMs, despite the fact that these loans only account for seven percent of all loans outstanding.

Prime ARMs represented 15 percent of the loans outstanding in the fourth quarter, but accounted for just 20 percent of the foreclosures started.

Much of the foreclosure activity was in hotbeds like California and Florida, two states that held 21 percent of all loans outstanding, but accounted for 30 percent of all foreclosure starts in the U.S.

The rate of foreclosure starts in Florida more than tripled over the last year, while more than doubling in California.

“Declining home prices are clearly the driving factor behind foreclosures, but the reasons and magnitude of the declines differ from state to state,” said Doug Duncan, MBA’s Chief Economist and Senior Vice President of Research and Business Development.

“In states like Ohio and Michigan, declines in the demand for homes due to job losses and out-migration have left those looking to sell the homes with fewer potential buyers, particularly with the much tighter credit restrictions borrowers now face. In states like California, Florida, Nevada and Arizona, overbuilding of new homes created a surplus that will take some time to work through.

During the fourth quarter, the seriously delinquent rate (90 days or more past due) increased for all loan types from the third quarter.

The rate increased 36 basis points for prime loans (from 1.31 percent to 1.67 percent), 306 basis points for subprime loans (from 11.38 to 14.44 percent), 46 basis points for FHA loans (from 5.54 percent to 6 percent) and 27 basis points for VA loans (from 2.56 to 2.83 percent).

Read the entire mind numbing report here.

(photo: robyngallagher)

Source: thetruthaboutmortgage.com