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HUGE DEAL FOR GSEs!

Fannie Mae Regulator Restricts Purchases to Qualified Mortgages – By Gregory Mott – Fannie Mae (FNMA) and Freddie Mac are being asked by their regulator to limit purchases to loans meeting qualified-mortgage requirements and those exempt from Dodd-Frank Act ability-to-repay rules.
The change announced today by the Federal Housing Finance Agency means that beginning Jan. 10 next year, the U.S.-owned companies won’t purchase interest-only mortgages, loans with 40- year terms or those with points and fees exceeding thresholds set by the Consumer Financial Protection Bureau (3 points). – Bloomberg 
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Underwater Mortgages Drop to 9 Million as Home Prices Rise: Report - BY Shanthi Bharatwaj| – (TheStreet) — Rising home prices are helping pull more distressed borrowers from out of the water, according to the March Mortgage Monitor Report from Lender Processing Services(LPS). The number of underwater borrowers — those who owed more than their homes were worth — fell 41% from a year earlier. In total, 9 million borrowers or 18% of active mortgages were underwater at the end of March. 
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(disappointed with HAMP) It’s Business As Usual When It Comes to Foreclosure – Richard Zombeck – Huffington Post
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Fannie Mae, Freddie Mac: Mortgage Serious Delinquency rates declined in March - by Bill McBride – Calculated Risk 
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(here we go again) Miami’s Condo Market Rebounds, Stoking a Building Boom - By TERRY PRISTIN – Of the 22,000 condos created in downtown Miami during the boom years, only about 600 remain unsold — thanks mainly to an influx of Latin American investors seeking a safe haven for their money. – NY Times 
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As Jobs Lag, Fed Is Viewed as Unlikely to Do More – By BINYAMIN APPELBAUM – NY Times 
vs.
Fed May Shift Talks Toward More Stimulus, El-Erian Says – By Susanne Walker – Bloomberg

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Baby Boomers Plagued by Mortgage Debt as They Enter Retirement – BY: KRISTA FRANKS BROCK – DS News 
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(3 charts) Housing Prices Continue To Firm – Calafia Beach Pundit – Seeking Alpha
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Mortgage Originators Say Regulation will be Biggest Challenge of 2013—By Far – by Jason Oliva – Reverse Mortgage Daily 
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(4 ways the government steals from you) PIMCO INVESTMENT OUTLOOK – There Will Be Haircuts – William H. Gross 
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(not light reading but important) Desperately Seeking $11.2 Trillion In Collateral, Or How “Modern Money” Really Works – Submitted by Tyler Durden – Zero Hedge 
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CoreLogic: Year-Over-Year Foreclosure Inventory Numbers Down Substantially – … there were 55,000 completed foreclosures in the U.S. in March 2013, down from 66,000 in March 2012: a year-over-year decrease of 16%. … “In March, completed foreclosures were down 52 percent from the peak in 2010, and almost all of the top 100 major metropolitan areas have declining foreclosure rates,” says Dr. Mark Fleming, … – MortgageOrb 
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S&P Predicts 20% Drop in Spain’s Housing Prices Over Next 4 Years; Bad Bank to Dump Distressed Properties on Market – Mike Shedlock – MISH’S Global Economic Trend Analysis 
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Report: More than 1 in 4 Working Renters Face Severe Housing Costs – BY: ESTHER CHO – According to the annual Housing Landscape report from the Center for Housing Policy (CHP), 26.4 percent of working renters spent more than half of their household income on housing costs in 2011. The share is an increase from 2008 when 22.8 percent of working renters had a severe housing cost burden. – DS News

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Phil Hall has been sighted: Mel Watt: The Wrong Man For The FHFA Job - BY PHIL HALL – Progress in Lending

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Fun – nothing to do with mortgages: NO NEED FOR A CORKSCREW – How do you open a bottle of wine without a corkscrew? Well, it’s actually simple. You just need your shoe and a hard surface. No, really. This works. – hattip Kim Komando 
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(details) Snowball effect: Shared appreciation bill fuels FHFA nomination – By Christina Mlynski – Housingwire 
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Pew: Impact of Mortgage Interest Tax Deduction Varies Geographically – BY: KRISTA FRANKS BROCK – DS News 
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How luxury homeowners dodge foreclosure – Owners of high-end properties who fall into financial trouble have more options than others. – By AnnaMaria Andriotis of MarketWatch – MSN.com 

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Large down payments provide stability to the housing market – OC Housing News 
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(rentals mentioned) U.S. Homeownership Rate Falls to Lowest Since 1995 – By Prashant Gopal & John Gittelsohn – … was 65 percent in the first quarter, down from 65.4 percent a year earlier and the lowest level since the third quarter of 1995, the Census Bureau reported … – Bloomberg 
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Bubble Symmetry and Housing – Charles Hugh Smith – If bubbles eventually revert to their starting level, Phase 3–capitulation and a return to pre-bubble prices–still lies head for the housing market. – Of Two Minds 
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Is Bernanke Preparing to Jump Ship? - Submitted by Phoenix Capital Research – … Ben Bernanke has announced he won’t be attending this year’s Jackson Hole meeting. A Jackson Hole meeting without the Fed Chairman is like having a performance of Hamlet without Hamlet himself in it. … – Zero Hedge 
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Home prices in gold ounces chart – Chart of the Day 
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The drawn out impact of quantitative easing on real estate: Japanese real estate continues to struggle while Bank of Japan expands monetary base. Federal Reserve and Americans style quantitative easing. – Dr. Housing Bubble – … Housing prices have moved up because of three major reasons; investor demand, low supply, and historically low interest rates.  Each one of these reasons can be traced to the Fed either directly or indirectly.  Can an aggressive central bank with a low rate environment re-inflate asset prices? …
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Here We Go Again – Builders Hold Lotteries for Right to Buy a House – Mike Shedlock –
MISH’S Global Economic Trend Analysis 
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Home Prices Growing At Pre-Bubble Rates On Bernanke Boost, But Big Shadow Inventory Lurks – Agustino Fontevecchia, Forbes 
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(DeMarco replacement) Obama Said to Choose Watt to Lead Fannie Mae Regulator – By Cheyenne Hopkins & Clea Benson – Housing industry officials expect President Barack Obama to nominate Representative Mel Watt, a Democrat from North Carolina, as director of the federal Housing Finance Agency as early as today, according to three people briefed on the matter. – Bloomberg

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    Nom de Plumber is a Nom de Plume.

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http://www.housingwire.com/news/2013/04/25/lawmaker-pushes-foreclosure-settlement-monitor
 
Gee, I wish that lenders would also target me for a fraudulent loan.  What is not to like?  

I can use the loan to buy a home with negligible downpayment, default on the loan in order to live in it for free, demand principal or interest forgiveness, and then have the servicer compensate me for such suffering.

Where can I sign up?

Thank you.

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(Yves is always entertaining) Mirabile Dictu! Republicans and (Some) Democrats Agree, Diss Obama Pick Mel Watt for Head of FHFA – Yves Smith – Naked Capitalism  

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A Mortgage Agency Pick Is Likely to Cause Conflict - BY PETER EAVIS AND ANNIE LOWREY – … The Obama administration wants to reduce government involvement but has made almost no big moves in that direction. Some critics question its resolve to scale back the role of Fannie and Freddie, which received one of the biggest bailouts of the financial crisis. They say Mr. Watt’s nomination looks like tactical maneuvering, designed in part to placate progressives in Congress who say the president has done too little to help homeowners. … – NY Times 
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(outlines 6 risk factors) Navigating the Mortgage Pricing Maze – Jack Guttentag – The Mortgage Professor

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Case Shiller Indices Show Midwest Price Weakness – BY: MARK LIEBERMAN, FIVE STAR INSTITUTE ECONOMIST – DS News  
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S&P/Case-Shiller: Home prices continue to strengthen – By Megan Hopkins – Housingwire

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Pending Home Sales Climb in March, Progress Slows - BY: MARK LIEBERMAN, The M Report
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Big Banks Fail 2012 Fannie Mae Star Program – BY PHILIP R. STEIN – Mortgage Crisis Watch 
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TBTF Servicing: Another Issue for Originators to Consider – BY ROBERT SIEGEL AND RUSSELL KNIN – Mortgage Crisis Watch 
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(4 page max) Simpler version of the Volcker Rule needed, CFTC commissioner says - BY ARLEEN JACOBIUS – Pensions and Investments

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(4 charts) Real House Prices, Price-to-Rent Ratio, City Prices relative to 2000 – by Bill McBride – Calculated Risk
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Will Shutting Down Captive Reinsurance Affiliates Reduce the Cost of Mortgage Insurance to Borrowers? – Jack Guttentag – The Mortgage Professor 
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Fannie to Share Data on 18 Million Mortgages to Woo Risk-Takers – By Jody Shenn – … joining rival Freddie Mac in taking the step as the government- controlled firms prepare to share risk with private investors. The loan-level data being released covers 30-year, fixed- rate mortgages sold to or guaranteed by the company between January 2000 and March 2012 … – Bloomberg
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(coming?) HARP 3.0 chatter sparks private-label loan debate – By Christina Mlynski – … Particularly, the Obama Administration is intending to push for a HARP 3.0 program, allowing private-label loans to be refinanced through Fannie Mae and Freddie Mac, according to analysts at Compass Point Research & Trading. … – Housingwire

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Sub-Prime 2013 Edition: It is Government Insured! – Jack Guttentag – The Mortgage Professor 
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(eminent domain will not die – quotes Vince Fiorillo) Mortgage-Seizure Plan Resurfaces As Investors Try To Kill It For Good – Daniel Fisher – Forbes

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BofA Seeks to Toss U.S.’s $1 Billion Suit Over Faulty Mortgages – By Patricia Hurtado – … lawsuit filed by the U.S. alleging it sold defective residential mortgage loans to Fannie Mae and Freddie Mac that defaulted. … – Bloomberg Businessweek 
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(he’s retiring) JIM O’NEILL’S FINAL PRESENTATION: Goldman Guru Presents His View Of The World From Now Through 2020 – Sam Ro – Business Insider
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Cutting Off The Hand To Spite The ARM? – by Nick Volpe – … A case in point: the addition of a new notice to borrowers that have adjustable-rate mortgages (ARMs). As envisioned by the Consumer Financial Protection Bureau (CFPB), a new rule calls for a notice to be sent to the borrower 210 to 240 days prior to the initial scheduled rate adjustment … – MortgageOrb 
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LPS: Home prices edge up in February – By Kerri Ann Panchuk – Home prices in the U.S. rose 1% from January to February and 7.3% from year ago levels, Lender Processing Services said in its February U.S. Home Price Index report. The average home price in February reached $210,000, a 1.3% improvement from the start of the year and another indicator of a healing housing market. A year ago, the average price hovered around the $196,000 mark. – Housingwire 
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Report: Originations Total $500B in Q1 - BY: TORY BARRINGER – … mortgage origination volume slowed down a bit in the first quarter, … According to data from Inside Mortgage Finance, originations totaled about $500 billion in Q1, down 4.8 percent quarter-over-quarter (from $525 billion) but more or less in line with analysts’ expectations. … – The M Report 
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Moody’s: Home Prices to Increase, Loss Severities to Remain High - BY: KRISTA FRANKS BROCK – Home prices will increase over the next three years as the economy expands and servicers work through their distressed inventories, according to a report from Moody’s Analytics. However, the firm predicts rising prices will not be enough to offset anticipated rising loss severities – DS  News

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Lenders venturing back into subprime market – By E. Scott Reckard, Los Angeles Times – Lenders are reemerging to offer the classic subprime trade-off: high-priced loans for high-risk customers. This time, though, the standards are more stringent.

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CoreLogic Case-Shiller Buy Prompted by Valuations, Brand - By Brad Finkelstein – National Mortgage News 
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Borrowers see glitches as big banks sell off mortgage rights – By Andrew Dunn – Charlotte Observer

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The FOMC statement came out this week. More of the same. Print baby, print. Continue to buy $40 billion per month of MBS to support housing.

I do not see how the Fed can ever unwind QE and the assets on their balance sheet. Quantative Easing stimulates GDP. Unwinding QE depresses GDP. One of the Fed’s dual mandates is encouraging employment which is difficult at best with depressed GDP.  Here are 4 articles to consider.    BC

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Bank of America’s Harris Says FOMC Statement Shows No Exit Yet – By Jeanna Smialek – Bloomberg Businessweek 
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Federal Reserve ponders possibility of increasing stimulus – By Ylan Q. Mui – Washington Post
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The Fed’s QE Exit Will More Than Quadruple Interest Costs For The US – Submitted by Tyler Durden  – … states in the US as the Fed ‘exits’ its QE program (taper, unwind, hold) – the result, the weighted-average cost of financing for the US government will almost triple from around 1.6% to around 4.3% over the next ten years. … CBO’s rather conservative estimates … over the next decade the USD cost of financing will explode from around $205bn (based on TBAC data) to over $855bn.  … – Zero Hedge 
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Foreign Holdings of US Securities Have Exploded – By: Jeff Cox – CNBC.com – Foreigners now hold more than $13 trillion in American securities, a record set as the U.S. seeks to assert itself as the safest port in troubled global waters. 

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CHART OF THE DAY: House Prices Are Back To Late 2003 Levels – Joe Weisenthal -… with average home prices across 20 metropolitan areas rising 9.3% from last year. That’s better than the 9% gain that had been expected. But of course housing has a LONG way to go before it really recovers. With the current reading, house prices are now just back to Autumn 2003 levels … – Business Insider
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Freddie Mac launches Loan Quality Advisor tool – … which gives lenders an automated way to identify credit, data and purchase eligibility issues before they deliver loans to the agency. - more – Housingwire

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Annaly: Is This Security A Safe Haven? Absolutely Not – Regarded Solutions – Seeking Alpha 
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(link to paper) The American Dream Is Shifting Away From Home Ownership – Richard Florida, The Atlantic Cities – Business Insider

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(great graphic check it out) How Broke Is Your State? – Municipalbonds.com

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NewOak: Alt-A jumbo loans add diversity to income portfolios – Whole loan portfolios of well underwritten Alt-A jumbo residential loans with full documentation deserve consideration in constructing a diversified income-oriented investment plan, said Ron D’Vari, CEO & Co-Founder of NewOak. – Housingwire

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Pending Home Sales index increases in March – by Bill McBride – … As I’ve noted several times, with limited inventory at the low end and fewer foreclosures, we might see flat or even declining existing home sales. The key is that the number of conventional sales is increasing while foreclosures and short sales decline – and that is a sign of an improving market, even if total sales decline. … – Calculated Risk

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(fascinating Redfin charts) Subprime by any other name: FHA insured loans are least appealing financing option for home sellers. The psychology of rising home prices. – … On the side of buyers, FHA insured loans have actually gotten much more expensive with mortgage insurance.  It is crazy that FHA mortgage insurance premiums can add up to 1.55 percentage points to your overall effective FHA mortgage rate.  That is very high in this rock bottom interest environment.  Why is the rate so high?  Because of legacy defaults but also the reality that you are giving people 30x leverage right off the bat. … – Dr. Housing Bubble

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The HARP Success Story – by Bill McBride – Calculated Risk

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(many variables to consider) Today’s Dream House May Not Be Tomorrow’s – By ROBERT J. SHILLER – NY Times 
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(painted in a corner?) The Fed Could Engineer A Major Sell-Off In The Bond Market When It Exits – Matthew Boesler – … All that means, according to Harris, is that the Federal Reserve is unlikely to stop buying bonds through its quantitative easing program any time soon. … More recently, Fed officials, including some notable hawks, have caught on to the disinflation risks. … – Business Insider

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Who Won? the 93% or the 7%? Why?- Mike Shedlock – Economic trends since 2009 show A Rise in Wealth for the Wealthy; Declines for the Lower 93%. – MISH’S Global Economic Trend Analysis    
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