The Federal Reserve reported on their weekly purchases of agency mortgage-backed securities (MBS). In the week ending March 17, 2010, the Federal Reserve purchased a gross total of $10.6 billion agency MBS. In that week the Fed sold $601 million mortgage-backeds (supported the roll), for a net total of $10.0 billion agency MBS purchases. This amount is unchanged from the previous three reporting periods. The goal of the Federal Reserve's agency MBS program is to provide support to mortgage and housing markets and to foster improved conditions in financial markets more generally. Only fixed-rate agency MBS securities guaranteed by Fannie Mae, Freddie Mac and Ginnie Mae are eligible assets for the program. The program includes, but is not limited to, 30-year, 20-year and 15-year securities…(read more)
The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending March 12, 2010. The survey covers over 50 percent of all US residential mortgage loan applications taken by mortgage bankers, commercial banks, and thrifts. The data gives economists a look into consumer demand for mortgage loans. A rising trend of mortgage applications indicates an increase in home buying interest, a positive for the housing industry and economy as a whole. Furthermore, in a low mortgage rate environment, such a trend implies consumers are seeking out lower monthly payments which can result in increased disposable income and therefore more money to spend on discretionary items or to pay down other debt. From the release… The Market Composite Index, a measure…(read more)
Yesterday, just one day shy of the second anniversary of the Bear Stearns collapse, Senator Christopher J. Dodd (D-CT), chairman of the Senate Banking Committee, released his long awaited proposal to overhaul the nation's financial regulations. The changes, viewed by many as the most sweeping since the Depression, are apparently backed by the Obama administration. Dodd said that the overhaul is designed to stabilize the nation's financial system in the hopes of preventing a repeat of the near collapse of major players in the fall of 2008. However, forces are both the right and the left appear ready to do battle over many parts of the proposal. Dodd had been working on the proposal with one of the leading members of the committee, Senator Bob Corker (R-TN), but recently decided to finish…(read more)
Fitch Ratings is warning that the expiring homebuyer tax credits, the end of the Fed's MBS Purchase Program , and the growing maturity of various government loan modifications programs are likely to increase loss severities on distressed mortgage loans later this year. The report says that these factors as well as low interest rates and the Federal Reserve's $1.25 trillion mortgage-backed securities purchase program have led to an improvement in both home prices and loss severities since the second quarter of 2009, but this is unlikely to continue. The $8,000 tax credit for first-time homebuyers and $6,500 credit for move-up buyers will be effectively expiring with the deadline for signed sales contracts on April 30. Buyers must complete the sale by June 30 so any drop off in sales…(read more)
The Federal Reserve reported on their weekly purchases of agency mortgage-backed securities (MBS). In the week ending March 10, 2010, the Federal Reserve purchased a gross total of $29.4 billion agency MBS. In that week the Fed sold $19.4 billion mortgage-backeds (supported the roll), for a net total of $10.0 billion agency MBS purchases. While this amount is unchanged from the previous week, the broader trend of a decline in weekly purchases continues. The goal of the Federal Reserve's agency MBS program is to provide support to mortgage and housing markets and to foster improved conditions in financial markets more generally. Only fixed-rate agency MBS securities guaranteed by Fannie Mae, Freddie Mac and Ginnie Mae are eligible assets for the program. The program includes, but is not…(read more)
American consumers are now defaulting on their mortgages in even greater numbers than they are walking away from credit card debt. According to FICO's® Score Trends Service, this is a phenomenon that is historically unique. FICO said the mortgage default risk for consumers with high FICO scores now exceeds their credit card default risk, even though most credit cards are unsecured credit and mortgages are secured by real estate. There is a parallel rise in mortgage delinquencies for these high scoring consumers. The company said that their analysis of trends in FICO scoring shows that recent repayment behavior has shifted significantly from what has historically been expected. In 2005 bankcard accounts were more than 3 times more likely to become seriously delinquent, that is 90+ days…(read more)
Commercial and multifamily mortgages continue to have the lowest rates of charge-offs of any loan types at banks and thrifts and perform better than the overall loan portfolios at those institutions according to the Mortgage Bankers Association (MBA). In response to what it referred to as a great deal of discussion and conjecture about those loans in recent months, MBA updated an earlier " DataNote " analysis of commercial and multifamily mortgage data from the 4th quarter of 2008 with data from the same period in 2009. The report states that 56 percent of the assets held by banks and thrifts at the end of 2009 consisted of loans and leases, a category that includes 1-4 family mortgages, home equity loans, credit cards and other consumer loans, commercial mortgages, multifamily mortgages…(read more)
Commercial and multifamily mortgages continue to have the lowest rates of charge-offs of any loan types at banks and thrifts and perform better than the overall loan portfolios at those institutions according to the Mortgage Bankers Association (MBA). In response to what it referred to as a great deal of discussion and conjecture about those loans in recent months, MBA updated an earlier " DataNote " analysis of commercial and multifamily mortgage data from the 4th quarter of 2008 with data from the same period in 2009. The report states that 56 percent of the assets held by banks and thrifts at the end of 2009 consisted of loans and leases, a category that includes 1-4 family mortgages, home equity loans, credit cards and other consumer loans, commercial mortgages, multifamily mortgages…(read more)
Equity futures are moderately higher ahead of a fairly light week of economic data. Dow futures are trading 18 points higher at 10,563 and S&P 500 futures are up a 2 points to 1,138. Commodities are also edging slightly higher with WTI crude oil up 33 cents to $81.83 per barrel and Spot Gold up 54 cents to $1,135.19. Meantime, the US dollar is a bit lower against the euro since France’s Nicolas Sarkozy said the continent would help Greece: “if it were necessary, the states of the euro zone would fulfill their commitments.” In terms of data the week ahead doesn’t quite begin until Wednesday afternoon when the Treasury releases its budget statement. On Thursday, weekly jobless claims will be accompanied by the monthly trade balance. Friday’s retail sales index…(read more)
Equity futures are moderately higher ahead of a fairly light week of economic data. Dow futures are trading 18 points higher at 10,563 and S&P 500 futures are up a 2 points to 1,138. Commodities are also edging slightly higher with WTI crude oil up 33 cents to $81.83 per barrel and Spot Gold up 54 cents to $1,135.19. Meantime, the US dollar is a bit lower against the euro since France’s Nicolas Sarkozy said the continent would help Greece: “if it were necessary, the states of the euro zone would fulfill their commitments.” In terms of data the week ahead doesn’t quite begin until Wednesday afternoon when the Treasury releases its budget statement. On Thursday, weekly jobless claims will be accompanied by the monthly trade balance. Friday’s retail sales index…(read more)
Friends
