Archive for the 'Mortgage News' Category
Random Perceptions About The Mortgage Industry
March 26th, 2008 Categories: Mortgage News, Random
Column like I seem them…
Bankers are entitlement minded elitists, Brokers are street level hustlers.
Presented with an identical deal, a consumer will routinely choose a Bankers offer, much to the Brokers chagrin (read ‘Why I need to be a hustler’).
Bankers don’t have to disclose how much margin they are making, Brokers do but usually don’t (until you arrive at the closing table, then maybe).
Bankers would like to eliminate Brokers. Brokers would like Bankers to play by the same rules they have to.
Consumers are almost as guilty as the ‘professionals’ for the mortgage mess.
‘Stated Wage Earner’ programs are an oxymoron, and a moron invented them.
Yield Spread Premiums are legally defined as ‘an option for the consumer to use to finance all or part of their closing costs. Their real life definition is ‘cha-ching’.
If a mortgage professional tries to rationalize their compensation with a Wal-Mart analogy, hang up the phone, go to Wal-Mart and try to buy a mortgage.
Mortgage rates have nothing to do with T-Bills, the Fed Rate or any other financial index. They have to do with the cyber-hormone emotional marketplace called Wall Street.
Trying to predict what mortgage rates will do next is like trying to predict what a bi-polar crack head will do next, sans meds.
Wall Street + Washington = The rich get richer and the middle class gets bent over.
A ‘write down’ is not a loss, its an unrealized gain. There is a difference.
There’s no such thing as a ‘no cost, no fee’ mortgage, duh.
You will pay through the nose for what you don’t know.
‘Transparency’ is still theoretic rhetoric in the world of mortgage.
People don’t trust mortgage professionals, period.
The credit crunch is akin to the industry choking itself out today for the mistakes it made yesterday.
Option ARM’s don’t deserve the reputation they’ve gotten. A bullet can’t be fired without a gun.
Last weeks used car salesman is yesterdays mortgage broker is todays used car salesman. (I personally know more than 10 people who have followed this path, nothing against used car salesman, just pointing out the corollary)
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Backslapping Mortgage Bailout, Fannie and Freddie Get a $200B Blank Check
March 20th, 2008 Categories: Mortgage News
Great Op/Ed article in the Wall Street Journal today…
Fannie Mae and Freddie Mac were allowed to ‘leverage up’ their portfolio from 30-1 to 33-1 (for every $1 in freed up capital they can spend $33 instead of $30) ‘creating’ an additional $200B(illion) worth of liquidity they may now use to buy more mortgage backed securities.
The recently carved up and eaten Bear Stearns had a 34-1 ratio; take that for whatever it’s worth…
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Yesterday’s capital expansion merely lets the companies continue their double lives as profit-making companies backed by taxpayer guarantees.
Of course, the last thing Congress wants is all of this to be transparent. The Members benefit from the current private-public confidence game because the two companies ladle them with campaign contributions to protect their privileged status.
At the end of the day if this strategy works the private investors get all of the upside. And if it fails? It becomes the taxpayers loss…
As the article states, with this type of mitigated risk policy it’s no wonder Fannie Mae’s stock has risen over 30% in the past week. This is what happens when Washington plays with Wall Street…
Also See:
Ubiquitous Perpetual Mortgage Solution Circle Jerk
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Top Ten Most Admired Mortgage Company’s
March 11th, 2008 Categories: Fortune Magazine, Mortgage News
‘What can I say about the mortgage industry that hasn’t already been said about Afghanistan, it’s bombed out and depleted’. -h/t Dave Chappelle
I’ve pretty much refrained from smacking the mortgage industry around on TXB since the middle of last year when ‘kicking the cat’ became en vogue and too mainstream. Many (many) others have taken the baton and carried it well, but this story was low hanging fruit and I couldn’t resist.
Fortune magazine has put together a list of the most admired companies in America and categorized them by industry, Mortgage Services included.
The top 10 most admired Mortgage Service companies according to Fortune’s poll are as follows:
- Land America Financial Group
- Washington Mutual
- Fidelity National Financial
- First American
- Sovereign Bank
- IndyMac
- Stewart Information Services
- Freddie Mac
- Thornburg
- Countrywide Financial
and here come the darts…
Land America, Fidelity National, and Stewart Information provide ancillary services to the mortgage industry (title, escrow, credit, technology, etc)…none actually lend money or originate mortgages, which explains how they made this list.
First American is being sued for fraud by the New York State Attorney Generals office. They allegedly conspired with WAMU, where WAMU: “strong-armed them into a system designed to rip off homeowners and investors alike”.
Thornburg may be out of business soon, although recent news from The Fed (not K-Fed) has seemed to re-energize the REIT. “Thornburg Mortgage, which specializes in large adjustable-rate mortgages (the kind that wouldn’t qualify for backing by Fannie or Freddie), was brought to its knees last week after successive margin calls by banks.” - Forbes
Sovereign Bancorp and IndyMac are probably the ‘best off’ of the lenders on this list, but thats not saying much. Freddie had a $2.5B fourth quarter loss, and Countrywide…never mind, I digress.
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More (and More) Speculation About Zillows Mortgage Offering
March 7th, 2008 Categories: Mortgage News, third party destination sites, zillow
From the Zillow Blog regarding their pending foray into the mortgage industry:
To participate in this new product offering, lenders must have their professional status confirmed prior to connecting with borrowers, so we want to give lenders a head start on the process:
1. Register with Zillow, if you haven’t already.
2. Then apply as a lender, and answer a few questions about yourself.
3. While access to borrowers is free, a one-time application fee of $25 is necessary to cover the costs of having an independent third party confirm your professional and employment status to Zillow. This is the only charge to participate; there are no other fees.
Hat tip to Blown Mortgage for the screen shot…
Gut reaction:
Zillow is taking measured steps to insure mortgage professionals who wish to participate in their pending ‘mortgage lead network’ are actually licensed and of generally sound character (on paper), to which I say: Good call!
I’ve speed read about 5 articles regarding Zillows pending mortgage offering from the likes of Brian Brady, Morgan Brown, Greg Swann, Todd Carpenter and on the Zillow blog itself. Since I’ve link loved to enough speculation to keep even the most rabid tabloid hungry reader satisfied, I’ll spare everyone my crystal ball predictions and just wait for Zillow to roll out their offering.
I’m a long time fan of the big Z and get good vibes from everyone I’ve met within their organization, so I’m optimistic based on this early tid-bit of news…not quite as much as Swann however, who is gushing with accolades about Zillow for ‘Reinventing and perfecting Capitalism’..? Maybe BHB knows information I dont (maybe I should sponsor BHBU too).
What I do know is that Zillow is becoming a Name Brand to more and more of the consumer public, and their mortgage play will surely add to this…which is exactly what I believe they are looking for. Zillow is trying to become to real estate (and mortgage) what Vasoline is to petroleum jelly.
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Fannie Mae, Freddie Mac agree to new appraisal standards
March 3rd, 2008 Categories: Mortgage News, New Appraisal Standards, fannie mae, freddie mac
Fannie Mae, Freddie Mac agree to new appraisal standards
From the Baltimore Business Journal…
Under the new code, mortgage brokers will be prohibited from selecting appraisers, and lenders will be prohibited from using in-house staff to conduct initial appraisals, among other things.
Lenders will also be prohibited from using appraisal management companies that they own or control.
Too early to determine what the new protocols will be, but will be sure to update as I find out…
Also See:
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