Guardian Residential Lending Industry News, July 9-16, 2020

Guardian Residential Lending Industry News, July 2-9, 2020
July 9, 2020
Guardian Residential Lending Industry News, July 16-23, 2020
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In the Know: A Roundup of This Week’s Local and National Real Estate Stories

Average U.S. mortgage rate falls below 3% for the first time (HW, July 16)

The average rate for a 30-year fixed mortgage is 2.98%, down from 3.03% last week, Freddie Mac says



Redfin: Over half of home offers were in a bidding war in June (HW, July 13)

Less inventory and low mortgage rates fueling competition for homes

The most competitive markets? Boston, San Diego and Salt Lake City.

Boston had the highest bidding war rate in June, of 72.4%, staying on top after 67.2% of offers had a bidding war in May. San Diego and Salt Lake City closely followed – 65.7% and 63.8% of offers in those markets faced competition, respectively.



Fewer Borrowers Making Full Loan Payments (The M Report, July 9)

Thirty-two percent of Americans did not make a full, on-time housing payment in July, according to Apartment List. This is up slightly from 30% in June.

The report added that missed payments are concentrated among renters, young and low-income households, and residents of dense urban areas.


Sure, Rates Are Low, But It’s Getting Harder to Get a Loan (Mortgage News Daily, July 9)

Credit tightening is becoming more evident according to the Mortgage Bankers Association (MBA). Its Mortgage Credit Availability Index fell to a reading of 125.0 in June, a loss of 3.3 percent. A decline in the index indicates stricter lending standards.


Realtors Report that their Customers are Back (Mortgage News Daily, July 9)

A new survey by the National Association of Realtors® (NAR) has found that the vast majority of its members feel as though their businesses are back on track. NAR says, “After enduring months of setbacks brought on by the coronavirus pandemic…more than nine in 10 members believe they are in the process of recovering as many states start to reopen their economies.”


Wells Fargo tells new clients they need $1 million in balances for certain mortgage refinancings (CNBC, July 9)

-Wells Fargo is now requiring new customers to bring at least $1 million in balances if they want to refinance a jumbo mortgage, up from a previous level of $250,000, according to people with knowledge of the policy.

-The change came in a July 1 overhaul of lending guidelines that broadly lowered barriers to the product for existing customers, while making it far harder for new ones to qualify, said the people, who declined to be identified speaking about the move.

-“They don’t want to take somebody else’s balance sheet and put it in on theirs,” said one of the sources. “We’re very busy and they wanted to slow down the number of loans coming in.”

-The bank also tightened lending standards in its mortgage business in the July 1 overhaul, which impacts everyone applying for a home loan, not just jumbo refinancings, according to one of the people. For primary and secondary home mortgages, the bank lowered by 5% the size of loans it would approve relative to a property’s value.


California, Oregon and South Carolina continue to require in-person notarizations (HW, July 9)

States across the U.S. expediting RON legislation amid emergency orders


Forecasters See Surprisingly Strong Housing Rebound, But There Are Risks (Mortgage News Daily, July 14)

The reopening of the economy in several states from the COVID-19 shutdowns has moved Fannie Mae’s Economic and Strategic Research (ESR) Group to raise its estimate for the 2020 full year GDP from the 5.4 percent decline it predicted in June to a 4.2 percent downturn. The economists say this improvement is almost entirely due to a stronger pace of recovery than they had anticipated.


New Home Sales Expected to Surge (Mortgage News Daily, July 15)

The Mortgage Bankers Association (MBA) is expecting new home sales to spike again in June, based on results of its Builder Application Survey (BAS). That survey shows that mortgage applications for new home purchases were up 20 percent from May and 54.1 percent compared to a year ago.


Thanks for reading, and be well.