Guardian Residential Lending Industry News, April 1-8, 2021

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In the Know: A Roundup of This Week’s Local and National Real Estate Stories

People Are Finally Starting to Think About Selling Homes Instead of Just Buying Them (M Report, April 7)

The percentage of respondents who say it is a good time to buy a home rose to 53 percent from 48 percent and there was a 3 point decline in those who viewed the timing as bad.

Attitudes about selling a home increased even more. Sixty-one percent said it was a good time…



A Year Into Pandemic, Home Means Something Different (M Report, April 7)

It showed nearly half (47%) of U.S. homeowners say they are utilizing their space differently since the onset of the pandemic. More than two-thirds (69%), according to the study, say spending more time at home has made them eager to upgrade.

Savings is the No. 1 source of paying for improvements (66% of those surveyed), while their second source of payment is credit cards (30%).

Nelson says homeowners using a credit card could save by seeking an installment loan

“Compared to using credit cards­­—which on average run over 18% APR—the low fixed rates and fixed terms of a personal loan, cashout refinance or mortgage refinance are really attractive,” he added.



Housing inventory is down 40%. Buyers are paying the price (HW, April 5)

Annual home prices grew 11.6% in January



Home sellers are feeling good about 2021 (HW, April 7)

Even buyers are growing in confidence, per Fannie Mae’s latest HPSI

Fannie Mae’s Home Purchase Sentiment Index (HPSI), a composite index designed to track the housing market and consumer confidence to sell or buy a home, increased in March by 5.2 points to 81.7.

Four of the HPSI’s six components increased month over month, including the components related to homebuying and home selling conditions, household income, and home prices. The mortgage rate outlook component experienced the only decline in March’s HPSI, with the latest results indicating that only 6% of consumers believe that mortgage rates will decrease over the next 12 months.


Mortgage rates hold steady at 3.18% (HW, April 1)

Homebuyer demand, though still strong, is beginning to slip


Need a Mortgage Loan? Good Luck. Lenders Are Tightening Standards. (WSJ, April 2)

Mortgages are going almost exclusively to borrowers with pristine credit histories

The mortgage market is humming, but getting approved for a home loan is as difficult as it has been in years.

Mortgage credit availability, a measure of lenders’ willingness to issue mortgages, is near its lowest level since 2014, according to the Mortgage Bankers Association, or MBA.

The tight lending environment illustrates a growing cleavage in the mortgage market: More home loans are being made than almost ever before, but they are going almost exclusively to borrowers with pristine credit histories and sizable down payments. Borrowers with credit qualifications that fall just outside the stellar category are finding fewer lenders willing to approve their applications. A segment of borrowers who would have qualified for a home loan early last year are now out of luck, deemed too much of a credit risk.

“Because mortgage credit is more difficult to obtain, it is a more competitive environment overall,” said Dr. Lawrence Yun, chief economist at the National Association of Realtors.

About 70% of mortgages issued in 2020 went to borrowers with credit scores of at least 760, up from 61% in 2019, according to the Federal Reserve Bank of New York.

The median credit score of borrowers approved for mortgages reached 786 in the fourth quarter of 2020, up from 770 during the same period in 2019.


Jamie Dimon says economic boom fueled by deficit spending, vaccines could ‘easily run into 2023’ (CNBC, April 7)

-Dimon, in his annual shareholder letter, sees strong growth for the world’s biggest economy in the near term, thanks to the U.S. government’s response to the coronavirus pandemic that has left many consumers flush with savings.

-While Dimon called stock market valuations “quite high,” he said a multiyear boom may justify current levels because markets are pricing in economic growth and excess savings that make their way into equities.

-While he is bullish for the economy’s immediate future, he sees serious challenges for the U.S., thanks to political and societal dysfunction.


CFPB proposes foreclosure ban until 2022 (HW, April 5)

Amending Regulation X to give servicers and homeowners more time to work through options

The Consumer Financial Protection Bureau (CFPB) released a notice of proposed rulemaking on Monday that would amend Regulation X to provide a special pre-foreclosure review period prohibiting servicers from starting foreclosures until after December 31, 2021.

Under current CFPB foreclosure rules, a borrower must be 120 days delinquent before the foreclosure process can start. The Bureau said that nearly 2.1 million households in forbearance are past the 90-day delinquent mark and said it is concerned that those homeowners may be transferred immediately in to the foreclosure process once their forbearance period expires.


COVID Factors Into Rise in Relocation (M Report, April 6)

Zillow conducted its first-ever mover report, which found that more than one in 10 Americans (11%) say they already moved in the past year, either by choice or by circumstance, contributing to the “Great Reshuffling,” and millions of additional households could enter the real estate market as a result of the COVID-19 pandemic.

Researchers from Zillow concluded that a significant number of homeowners say they’re more likely to move and sell their home as a result of the pandemic, representing an additional 2.5 million households that could enter a tight real estate market already driven by unrelenting demand.


Thanks for reading.