Guardian Residential Lending Industry News, April 16-23, 2020

Guardian Residential Lending Industry News, April 9-16, 2020
April 16, 2020
Guardian Residential Lending Industry News, April 23-30, 2020
April 30, 2020
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In the Know: A Roundup of This Week’s Local and National Real Estate Stories 

Despite pandemic, US home prices could very well hold steady…

COVID-19 paused the housing market. What happens next? (Curbed, April 22)

Reports suggest home prices are unlikely to move

The economic fallout from the spread of COVID-19 has put the housing market in the United States on pause.

New home listings have dropped precipitously. Mortgage lending has gotten even more strict, making it harder to get a home loan. In March, home sales dropped 9 percent nationwide compared to the previous month, according to Redfin. The drop in April is certain to be even more dramatic.

But what will the housing market recovery look like once the pandemic passes and the economy reaches its new state of normal? A number of new reports explore how it might play out.

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Covid Fallout Fails to Stop March Home Sales, 97 Months of Annual Growth (Mortgage News Daily, April 21)

Existing home sales fell back last month from their unexpectedly good performance in February, but still maintained their long record of annual increases.

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Home listing traffic has spiked despite sales going down (HW, April 23)

Even though new home listings and home sales have dropped since COVID-19 hit, there are more buyers actively looking for homes online than a year ago, according to Zillow.

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Purchase Applications Stabilizing, Refis Rage On (Mortgage News Daily, April 23)

Purchase application volume was up slightly last week, the first gain since early March. Refinancing and overall volume, however, were flat.

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Fannie Mae, Freddie Mac will begin buying some mortgages that are in forbearance (HW, April 22)

Citing the need to keep the mortgage market “working for current and future homeowners during these challenging times,” Fannie Mae and Freddie Mac will soon begin buying certain mortgages that are in forbearance.

Under the GSEs’ current policies, Fannie and Freddie do not buy loans in forbearance. But given the unprecedented rise in forbearance due to the coronavirus, the Federal Housing Finance Agency announced Wednesday that it is allowing the GSEs to buy loans that go into forbearance within the first month.

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Fannie Mae, Freddie Mac will only require servicers to advance 4 months of payments on loans in forbearance (HW, April 21)

FHFA announces new policy to address servicer liquidity concerns

For the last several weeks, the mortgage servicing industry has been crying out for help, lobbying the government to set up a federally backed liquidity facility for servicers to address the rapid rise in forbearance due to the coronavirus.

Now, the Federal Housing Finance Agency is moving to help servicers who collect payments on loans backed by Fannie Mae and Freddie Mac, but not in the exact way that servicers were expecting.

Rather than setting up a liquidity facility, which would help servicers cover the principal and interest payments they are required to send investors on loans that are in forbearance, the FHFA is changing Fannie and Freddie’s policies to limit the number of payments servicers will be required to make.

Under the new policy, servicers will only be required to advance four months of missed payments for loans in forbearance. After that, the servicer is under “no further obligation to advance scheduled payments.”

According to the FHFA, this policy applies to all GSE servicers, whether they are banks or nonbanks.

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Despite Pandemic, U.S. Home Prices Could Very Well Hold Steady in 2020 (MarketWatch, April 16)

U.S. home prices are likely to hold steady in 2020, even in the face of the coronavirus pandemic and widespread shelter-at-home orders, real estate strategists for UBS Wealth Management Americas said in a report Wednesday.

The country’s housing market headed into 2020 with strength and on much firmer footing in terms of lending practices and supply than during the 2008-09 housing market collapse, when neighborhoods faced fire sales and waves of foreclosures, according to the report.

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Chase stops accepting HELOC applications (HW, April 16)

Bank “temporarily pausing” on home equity lines of credit

Just a few days after it raised its lending standards to require nearly all purchase mortgage borrowers to have at least 20% down and a 700 FICO score, JPMorgan Chase is “temporarily pausing” its home equity line of credit offering.

Beginning April 16, Chase will no longer accept new HELOC applications. Customers with existing HELOCs will be able to continue to draw funds on those lines of credit, but the bank is not accepting applications for new HELOCs.

In a statement provided to HousingWire, Amy Bonitatibus, chief marketing officer for Chase Home Lending, said that the bank is making the change due to the “uncertainty” currently in the market.

“Due to the economic uncertainty, we’re temporarily pausing new applications for home equity lines of credit,” Bonitatibus said. “Customers can still tap into their home’s equity through a cash-out refinance of their existing mortgage.”

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Since we’re all home anyway…

21 easy home projects to tackle while you’re hunkered down (Curbed, April 20)

Level up your spaces without buying anything new

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Thanks for reading, and be well out there!