California Defaults Reach Lowest Rate in Four Years

According to a report in dsnews.com,

For the second quarter of 2011, California homes entering the foreclosure process decreased to their lowest rate in four years, according to DataQuick, a San Diego-based company that tracks nationwide real estate activity.

DataQuick attributes the decrease to an increasingly stable housing market and new mortgage servicing policies.

“A lot of theories are being floated as to why the numbers are down. Bank policy changes. Legal challenges. Politics. Holding back temporarily so as not to flood the market,” said John Walsh, DataQuick president.

“The fact of the matter is that no one really knows, outside of lending and servicing industry insiders,” Walsh continues. “One thing is certain: Homeowner distress spreads fastest when home price declines are steepest. And it now appears likely that, barring some new economic shock, the worst of the price declines are behind us.”

The number of notices of default decreased 17 percent from April to June when compared with the previous quarter and 19.2 percent when compared with the second quarter of last year. It was the lowest rate reported since the second quarter of 2007.

DataQuick reports that most of the loans defaulting today were originated between 2005 and 2007 when weak underwriting standards were most prevalent.

Read more visit - http://www.dsnews.com/articles/california-defaults-reach-lowest-rate-in-four-years-2011-07-20

Not Much Relief for California Home Sales, Prices — Except San Francisco

According to a report in National mortgage news,

Home sales in the Golden State fell 6% in May from the prior month with the California Association of Realtors blaming tightened financing conditions and the weak economy for the decline.

According to figures compiled by the trade group, median home prices fell roughly 1% on a sequential basis to $291,790, but were down 11% compared to May 2010.

"Market demand has been sluggish as would-be home buyers remain concerned about the direction of the economy," said CAR president Beth Peerce. "They may also be weary of delays in the buying process and difficulty in getting a home loan."

The trade group chief also blamed a larger inventory of distressed properties sitting on the market for the sluggish sales pace and weak prices.

The San Francisco Bay area, however, bucked the trend, with values rising 4% between April and May. The areas with the biggest price gains include: Napa (up 23%), San Mateo (+13%), and Marin (+11%).

DataQuick of San Diego issued its own results for May sales in the Bay Area, finding that the median price paid for all new and resale properties (including condos) was $372,000, up 3% from April but down 9% from May 2010. It was the largest year-over-year drop in the median scale since August 2009, when it fell 20%.

"Given the sluggish start to this spring's home-buying season, with sales 20% to 30% below average, it's no surprise we're logging sharper declines from 2010," said DataQuick president John Walsh. "Sales got a big shot in the arm a year ago, when people rushed to take advantage of expiring homebuyer tax credits. Today the market must stand on its own, and it's having a hard time doing that in the absence of stronger job growth and consumer confidence."

Read more - http://www.nationalmortgagenews.com/dailybriefing/2010_369/california-home-sales-1025258-1.html?ET=nationalmortgage:e1402:92746a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=NMN_Daily_Briefing_061611

Corporate taxes should be simplified and rate lowered, Obama says. But many loopholes have a powerful constituency ?

WASHINGTON

President Barack Obama's call to lower corporate tax rates is popular among business leaders and lawmakers from both parties. That support, however, won't be easy to maintain if the president ever gets specific about how to pay for the lower taxes.

Obama said in his State of the Union address that he wants to close corporate tax loopholes and use the additional revenue to lower corporate tax rates for the first time in 25 years — without adding to the budget deficit. The top corporate tax rate is 35 percent, among the highest in the industrialized world. However, federal tax laws are filled with so many credits, deductions and exemptions that few companies pay the top rate.

"Over the years, a parade of lobbyists has rigged the tax code to benefit particular companies and industries," Obama said in his speech Tuesday night. "Those with accountants or lawyers to work the system can end up paying no taxes at all. But all the rest are hit with one of the highest corporate tax rates in the world. It makes no sense. It has to change."

Meanwhile, key congressional Republicans said Wednesday that tax reform shouldn't be limited tocorporate taxes — individual income taxes should also be revamped.

Obama's goal is to create a simpler tax code that encourages sound business decisions rather than aggressivetax planning. As it stands now, businesses and individuals spend more than 6 billion hours a year working to comply with the tax code, according to the National Taxpayer Advocate, an independent watchdog within the Internal Revenue Service.

It will take a sustained effort by the administration, however, to forge a consensus with lawmakers on reshuffling corporate taxes in a way that is sure to create winners and losers. The "loopholes" Obama talked about in his speech are regarded as cherished, well-deserved tax breaks by many lawmakers in both parties.

"I'm asking Democrats and Republicans to simplify the system," Obama said. "Get rid of the loopholes. Level the playing field."

There are tax breaks for investing in new equipment and buildings, spending on research and development and investing overseas. There are tax breaks for the owners of NASCAR race tracks and movie production companies. There are tax breaks for oil, natural gas and coal companies, as well as the producers of alternative fuels.

In all, the tax code runs 3.8 million words.

"Most of those words are in there because somebody's lobbyist wanted them in there," said Howard Gleckman, a fellow at the Urban Institute and editor of TaxVox, a blog on tax issues. "Everybody likes their special interest tax break."

Obama called for eliminating billions in tax breaks for oil companies to help fund research on alternative energy. It was a replay of his budget request last year, when he asked Congress to increase taxes on oil and gas companies by a total of $36.5 billion over the next decade. Congress largely ignored the request.

Read more...Visit-http://www.csmonitor.com/Business/Latest-News-Wires/2011/0128/Corporate-taxes-Cut-rate-Sure.-But-loopholes

Rise in mortgage rates have dampened refinancing

The rising mortgage rates have snuffed out a refinancing boom which began earlier this year. According to the government backed mortgage firm,Freddie Mac's survey, the rate of a 30 year fixed rate mortgage averaged 4.61% this week which is the highest since June24th.

The Wall Street Journal says that a host of factors have helped drive rates higher, most recently including this week's tax compromise between President Obama and congressional Republicans. The package includes some measures to stimulate the economy and will likely result in higher budget deficits—both of which are anathema to bond investors.

Since the increase in mortgage prices, refinancing has become unattractive to more than 5 million borrowers. Mortgage Bankers Association said earlier this week that its index for refinancing activity fell last week to its lowest level since the early June. Refinancing activity surged between April and the early fall, as Treasury yields tumbled from 4% to less than 2.5% and mortgage rates fell from more than 5%. After the surge in rates, refi activity is down 42% from its peak in August.

However the good news is that the rise in rates have not effected the steady increase in home purchase activity. According to the MBA, new mortgage origination rose last week, but its still down more than 12% from a year ago. The team of analysts at PrivoCorp suggests that this steady increase in home purchase is a sure indicator that the economy is slowly improving. PrivoCorp processes loans and we do not originate loans.

Mortgage Rates Rise to 4.66%

According to Wall Street Journal, mortgage rates rose last week to the highest since july.The 30-year fixed-rate mortgage averaged 4.66% last week, up from 4.56% two weeks ago. Rising rates are likely to further crimp refinance activity, which was down 1% for the week and down 8% from year-earlier levels.

But rising rates could encourage some fence-sitting buyers to close deals, and home-purchase mortgage applications jumped by nearly 2% last week, sending activity to its highest level since May.

PrivoCorp is a loan processing company and we do not originate loans.

Home loan demand rises due to low interest rates.

U.S. mortgage applications rose last week as there is an increase in demand for new loan purchase and refinance. More and more people are trying to take advantage of the low interest rates and lock in on them before it increases. Mortgage Bankers Association says there is an 5.8 % increase in the mortgage applications, which includes both purchase and refinance loans.

Michael Fratantoni, the MBA's vice president of research and economics, said in a statement that the increases in purchase application coincide with the October's employment report which indicates some improvement in the economic growth.

However this increase in home loans is very little, as the lending standards have become very tight thereby preventing many homeowners from taking advantage of the low interest rates. Cameron Findlay, chief economist at LendingTree.com in Charlotte, North Carolina, says "underwater mortgage" -- where the amount owed on the mortgage exceeds the home's value -- "are one of the biggest banes of the homeowners who want to refinance.This negative equity makes many homeowners unqualified for refinancing and prevents some from selling." Despite the slow progress, the very fact that there is an increase in the demand for mortgage application is an indicator of some positive activity in the housing sector and the team at PrivoCorp hope that this trend continues and the economy keeps on improving. To read more on this, check out msnbc.com

Rates fall to record low : Good time to lock in on these low rates.

According to Bankrate.com, the bench mark 30 year fixed rate mortgage fell 9 point, from a 4.45 last week to 4.42 this week. Rates haven't been lower since 1953, according to the National Bureau of Economic Research's statistics on FHA-insured loans.

The benchmark 15-year fixed-rate mortgage fell 9 basis points, to 3.81 percent. The benchmark 5/1 adjustable-rate mortgage fell 10 basis points, to 3.57 percent, and the 30-year, fixed-rate jumbo fell 6 basis points, to 5.04 percent. All of those are record lows in Bankrate's weekly survey.

The team at PrivoCorp, suggests to all borrowers to consult with their loan officers and lock in on these low rates. If the rates do dip further down, there is no need to be concerned as you can always refinance.

PrivoCorp is loan processing company and does not originate loans. This activity is performed by our clients - brokers or lenders.

BW: Home prices in 20 cities rose 0.3% in Jan 2010

According to a recent article in business week online, home prices in 20 U.S. cities unexpectedly rose in January, indicating the housing market is stabilizing as the economy expands. The article mentions that the S&P/Case-Shiller home-price index climbed 0.3 percent from the prior month on a seasonally adjusted basis, matching the gain in December, the group said today in New York. The gauge was down 0.7 percent from January 2009, the smallest year- over-year decrease in three years.

The probable causes for the increase ...??

• Cheaper homes
• low borrowing costs 
• government incentives

Gains in hiring are the best bet to overcome mounting foreclosures that keep the pressure on prices and pose a threat of renewed declines in real estate.

Growth in new home sales will definitely help companies like PrivoCorp which help close mortgage loans as contract processors. PrivoCorp specializes in the contract processing of FHA loans across the country.

Bankrate.com: Mortgage rates drop to all-time low

The benchmark 30-year fixed-rate mortgage fell 13 basis points, to 5.06 percent, according to the Bankrate.com national survey of large lenders.

That's the lowest rate on the 30-year fixed in the 24-year history of Bankrate's weekly mortgage index. Previously, the all-time low had been 5.13 percent, on April 1 this year. (In case you're wondering, the highest was 12.31 percent -- in the first-ever survey, conducted Sept. 25, 1985.)

One year ago, the mortgage index was 6.33 percent; four weeks ago, it was 5.34 percent.

The benchmark 15-year fixed-rate mortgage fell 13 basis points, to 4.48 percent. That, too, is a record low. The benchmark 5/1 adjustable-rate mortgage was unchanged, at 4.58 percent. That's a record low dating back to when Bankrate started collecting 5/1 ARM rates at the beginning of 2005. And the benchmark 30-year fixed jumbo fell 29 basis points, to 5.95 percent. It was 5.6 percent in June 2003.

PrivoCorp - the fastest contract processing company for mortgage home loans expects volumes to increase as a result of this. As it is, PrivoCorp is experiencing an increase in the volume of loans submitted as well as the value of the homes being transacted. Although this is not a scientific indicator - seems to indicate that economy is moving in the right direction (at least there is a confidence in the direction of movement).

For more information please check out the bankrate.com website.

Mortgage Rates Lowest Since Late May

According to an article in the Memphis Daily quoting Freddie Mac sources, the average rate for a 30-year fixed-rate mortgage was 5.12 percent, down from 5.29 percent last week. At this time last year, the average rate for 30-year fixed-rate mortgages was 6.47 percent. For more information visit the Memphis Daily.

The hope in the mortgage banking industry would be that these low rates spur refinance activity (and possibly purchases), but the overall unemployment and real estate prices are the ones that will drive economic growth and will be real proof of the country coming out of the recession.

PrivoCorp (http://www.privocorp.com/) is one of the fastest processors of conventional and FHA mortgages in the country.

YTD - Mortgage rate trends

The rates have not high but at the same time are above their all time lows. Rate courtesy of Mortgage Wholesale rate (as on June 26th 2009)

A revolutionary program that give home buyers easier access to money.

The Memphis Area Home Builders Association is launching a program that will allow first-time homebuyers to borrow their down payments and repay it from their $8,000 federal tax credits.“This means Memphis Area Home Builders Association (members) can sell homes by loaning people their down payment so they can get in basically for no money down,” said Hodgkins, owner of Oaktree Homes LLC. “But that (loan) is to be repaid by the assignment of their tax credit.”

The program is the first of its kind in the nation and could jumpstart the county’s sagging new home sales by giving potential homebuyers access to money at closing instead of making them wait for their amended tax returns, which can take weeks or months to receive.

The stimulus bill, earlier this year established the first-time homebuyers tax credit of $8,000.
The program was geared for anyone who has never owned a home or who hasn’t owned one within the past three years. It provides the credit to first-time buyers who close a loan on the purchase of their principal residence between Jan. 1 and Nov. 30, 2009, and the money doesn’t have to be repaid unless the recipient moves from that home within three years.The only problem with the program, many homebuilders have argued, is the tax credit takes awhile to arrive after a buyer files an amended tax return.

The MAHBA program was the brainchild of Glays. Glays began researching HUD rules and found out that an “anticipated tax credit” was exempt. He said,“Under HUD rules, any anticipated cash coming in can be used as part of the qualifications for underwriting a mortgage."

This program doesn’t secure the down payment with the property, but rather with the assignment of the tax credit. Glays said if you know you’ve got money coming in from any source, “you can get a mortgage on the premise that you’re going to get that money and it’s going to be liquid for you to use.”

Anyone who qualifies for the first-time homebuyers tax credit and who is buying a home from an MAHBA member qualifies for the association’s down-payment loan. The tax credit does have income limits and other restrictions.MAHBA will assess a $500 service fee for the loan, including the paperwork needed for the amended tax return and bank account setup to handle the arrival of the $8,000 tax credit.

PrivoCorp is expecting an increased volume of loans based on plans like these.

Low mortgage rates leads to spending boost

Here's some information from the European Press ...
**********************
Record low interest rates allow millions of borrowers to switch to cheaper home loans and this enables US homeowners to save close to $18bn on their mortgage repayments this year.“In aggregate, this adds up to about $2.5bn in extra spending cash in the pockets of those homeowners to spend over the coming year.";says Frank Nothaft, chief economist at Freddie Mac.

Refinancing trends is expected to be boosted by the government’s plans to help more borrowers to qualify for mortgage re-negotiations.This means that this year’s savings for homeowners could reach $18bn.The savings are based on refinancing loans that qualify for backing by Freddie Mac and rival Fannie Mae with a 5 per cent interest rate.

Under the government program, borrowers who have mortgages owned by Fannie Mae or Freddie Mac can refinance without additional mortgage insurance costs, even if the loan is more than 80 per cent of a home’s value.Under the government program, borrowers who have mortgages owned by Fannie Mae or Freddie Mac can refinance without additional mortgage insurance costs, even if the loan is more than 80 per cent of a home’s value.

Federal Reserve striving to push mortgage rates to an all time low.

The Freddie Mac survey rate recently hit an all-time low of 4.87%, and qualifying borrowers can find sub-5% rates fairly easily. The recent actions of the Fed have pushed fixed mortgage rates to all- times low. By Buying the Treasury securities outright, the Federal Reserve has acted to push both intermediate- and long-term Treasury rates lower. In order to drive down primary mortgage rates, the Federal Reserve has also bought huge amounts of agency debentures and mortgage backed securities. The Fed is expected to continue these activities, as they are part of the arsenal they are using to fight the financial crisis and the resulting recession. Seems like mortgage rates are not going to be going anywhere in the near future.

Unemployment surges to 7.6%, Mortage rates to decrease?

According to USA Today,the unemployment rate rose to a 16-year high 7.6% in January as employers slashed a seasonally adjusted 598,000 jobs, the most since 1974, the government said Friday in a report that showed the job market deteriorating at a rapid clip. For more information go to http://www.usatoday.com/money/economy/2009-02-06-job-losses-january_N.htm

This surge in unemployment could lead to a dip in the mortgage rates. So it is a good time for refinancing and buying houses for those with surplus cash. PrivoCorp's clients can help borrowers with speedy and low mortgage rates. For more information on banks that are offering lower rates contact info(at)privocorp.com or visit www.privocorp.com

Borrowers waiting for lower rates?

Even though rates are low, borrowers are tending to adopt a wait and watch approach to their home loans. The reasons could be varied: job insecurity, expectations of lower rate or existing foreclosures.
According to Holden Lewis of Bankrate.com, fewer people are applying for mortgages, even though the average rate on a 30-year fixed remains below 6 percent for the 11th week in a row. Rates went up in the last week, so it's understandable that fewer people applied for mortgages. Still, it's kind of weird to see a lull in applications while rates are below 6 percent.

PrivoCorp, a loan processing company, has found that FHA refis are on the rise and now contribute up to a third of all the refis. For more information contact www.privocorp.com

Rates increase

Rates for the 30 year fixed increased 31 basis points to 5.59%. There is a belief that inflation concerns may be behind the rise.

Pending home sales plunge to record low in Nov.

According to the USAToday, pending U.S. home sales fell to the lowest level on record in November, as the plummeting stock market and faltering economy gave more buyers cold feet, the National Association of Realtors said Tuesday.

The index, which tracks signed contracts to purchase existing homes, fell 4% to 82.3 from a downwardly revised October reading of 85.7 in October. That was far worse than the reading of 88 that economists expected, according to Thomson Reuters.

Typically there is a one- to two-month lag between a contract and a done deal. So November's decline foreshadows bleak results for December's existing home sales numbers, set to be released Jan. 26.

Sales contracts fell around the country, but were weakest in the Northeast and Midwest. The Realtors' index was down 5.3% from November 2007, and now sits at the lowest since in its eight-year history — beating the previous record low of 83 in March 2008.

An index reading of 100 is equal to the average level of sales activity in 2001, when the index started.

For more details visit: http://www.usatoday.com/money/economy/housing/2009-01-06-pending-home-sales-nov_N.htm

Mortgage rates skyrocket - Bankrate.com

According to Holden Lewis  of Bankrate.com, Mortgage rates went up this week from near-record lows as brokers and bankers scrambled to keep up with an influx of applications.

The benchmark 30-year fixed-rate mortgage rose 42 basis points, to 5.84 percent, according to the Bankrate.com national survey of large lenders. One year ago, the mortgage index was 6.31 percent; four weeks ago, it was 5.97 percent.

The benchmark 15-year fixed-rate mortgage rose 16 basis points, to 5.46 percent. The benchmark 5/1 adjustable-rate mortgage rose 11 basis points, to 5.95 percent.

For further information http://www.bankrate.com/brm/news/mtga/Dec2508_mortgage_analysis_a1.asp

Processing company Privo (www.privocorp.com) has been experiencing higher than normal volumes in loans the past few weeks, however there are challenges associated with lower home prices.

Low rates drive mortgage applications up 48%

According to the USAToday, Mortgage applications surged to the highest level in more than five years in the latest week, as potential borrowers came out to refinance at interest rates near record lows.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications, which includes both purchase and refinance loans, for the week ended Dec. 19 soared 48% to the highest reading since the week ended July 18, 2003.

For the full article, go to http://www.usatoday.com/money/economy/housing/2008-12-24-mortgage-applications_N.htm?loc=interstitialskip