Dennis' Mortgage Blog

Question of the week:  Is the new regulation regarding compensation for mortgage originators in effect today?

Answer:  Last week I discussed the Federal Reserve’s changes to the Truth-In-Lending  (Reg Z) regulations that were to go into effect today that would completely change our industry (link here).  In the update I noted that two groups were suing the Fed to block implementation of the new regulations and were requesting a stay until a court could determine the Constitutionality of the provisions.

On Wednesday a U.S. District Court denied the suit and the motion for a stay. 

Late last night the U.S. Court of Appeals for the District of Columbia issued a stay on the Fed preventing implementation of the new Reg Z rules until they could hold a hearing.  On Monday April 4^th the Fed will present a summary of their case and why they feel implementation should move forward.  On Tuesday April 5^th the plaintiffs (National Association of Mortgage Brokers and National Association of Independent Housing Professionals) will respond to the Fed’s presentation.

After the submissions the Appeals Court will rule as to whether to revoke the stay and let the Reg Z changes be implemented, continue the stay until the plaintiffs motion to throw out the new Fed requirements have had a chance to be heard and decided upon by the courts.

Industry wide thousands of mortgage applications were submitted, and/or locked, yesterday ahead of the new rule going into effect that would eliminate mortgage options for applicants and remove ability for mortgage originators to compete with one another and the largest lenders.

This stay is very good news for home mortgage applicants, for the mortgage industry as a whole and for the housing markets across the nation. Whether it continues to be good news we will find out next Tuesday after the plaintiffs response is reviewed by the Court.

Have a question for me?  Ask me!

Rates went up this week on various economic reports.  Most significant was the employment data released today reporting over 200,000 jobs added to the private sector in February, the second month in a row with over 200k new private sector jobs, and the unemployment rate falling to 8.8%. 

The news was met cheerfully and cautiously depending on whether you needed the news to bolster yourself or if you ignored the news and looked at the data.  Great news that the private sector hiring has begun to gain traction.  It signals companies are starting to get used to spending some of the cash they have stockpiled.  However with personal income and compensation figures very stagnant the jobs being filled are not paying as well as many of the jobs lost.  But hey a job is a job right?  Regarding the unemployment rate, keep in mind the number is the percentage of people actively seeking work and does not include those who have stopped, or given up, trying to find a job.

Overall positive news from the employment sector.  Not great news but definitely better than we have seen and this positive news has been better for stocks than bonds and rates have inched a bit higher this week from last.

A new feature! I am working on posting snippets on the economy and mortgage industry on a daily basis on My Blog.  Cross posting on Twitter (follow me at dcslb) and I’m working on getting a Facebook page together for mortgage information and updates.  In the meantime check in whenever for daily updates or to review the week.

This week’s blog postings:

Show Me(rchants) The Money!  A look at personal income and consumer spending for the month of February and a request to you personally.

Are You Confident?  Tuesday consumer confidence was reported and it seems you may not be as confident as you were—or at least other are not.

What’s A “Qualified Mortgage?”  The Dodd-Frank financial reform act requires the definition of a qualified mortgage, how that is defined will greatly impact the housing markets and who can and cannot qualify for a mortgage.  

Feedback is always welcome!  Please let me know if what you think of a bit more information through the week on specific economic events and issues relating to the mortgage and housing markets versus more detail on the Friday update.  Instant feedback click here

Rates for Friday April, 2011 Those who followed my advice last Friday about not taking risks in the current market benefited, those who are a bit less risk averse have some waiting to do to see if they can get a lower rate.

FIXED RATE MORTGAGES AT COST OF 1 POINT*

30 year conforming                               4.875%             Up 0.125%

30 year high-balance conforming           5.00%               Up 0.125%

30 year FHA                                         4.50%               Up 0.125%

30 year FHA jumbo                              5.00%               Up 0.25%

Please note that these are base rates and adjustments may be added for condominiums, refinances, credit scores, loan to value, no impound account and period rate is locked. 

*Please note that rates quoted are based on average of several lenders for a purchase transaction with 20% down payment with an impound account for taxes and insurance and a minimum FICO score of 740; APR is not quoted as it is dependent upon specific loan amounts, lenders and services selected.  Numbers provided are for comparative purposes only.

ANOTHER NEW FEATURE!  Always looking to add value to your free Weekly Rate and Market Update I have started an Open House page on my website that is kicking off this week.  Click on the link below and you will go to the page that will provide you with finance profiles of homes on the market you can see this weekend.

Weekend Open Houses

April is here and I have not fooled anyone today!

Have a great week,

Dennis