I travel a fair amount via commercial airplane. (Greetings today from Ft. Lauderdale; this afternoon it’ll be Chicago.) But forget traveling in heavier-than-air-craft: there are people who live in airplanes! Meet Jo Ann, a beautician. Let’s see this baby appraise out for a refi! But the price is right for anyone willing to make the effort, as airplane carcasses are very affordable. One big topic at the Bank of England Mortgage event going on here is how interest rates impact affordability. Last week the Commentary included a link to a “handy-dandy chart for LOs to help borrowers to see how rates impact affordability.” I received several emails pointing something out, succinctly summed up by Fairway’s Mike S. “A quick glance shows that only 20% of the population’s affordability is determined by interest rates. At 3%, 65% of the country is already priced out. At 9%, that number is 85%. That means for 80% of the population, the interest rat
What would this opening paragraph be without some fun, non-mortgage stuff? Watch a rare livestream of bald eagles nesting on eggs in California. 32 trillion gallons of water have fallen in California in recent weeks, resulting in a disaster declaration. Speaking of that state, the weather forecast for San Diego is warm and sunny next week as hundreds of mortgage professionals are preparing to go to California for the MBA’s Independent Mortgage Banker’s Conference. (Say “hi” if you see me.) One topic of conversation, of course, will be the bond market and mortgage pricing. Months ago, I’d receive question after question about pricing. “Why is no one paying anything above par (100)? I’d explain that no investor wanted to pay 103 and lose 3 points in a matter of months if rates dropped a little, and that 7 ½ percent 30-year loan refinanced at 100. Well, here we are. Helping lenders was a reduction in securitization costs, but takin
Our industry continues to be battered. Starwood Capital-backed Reverse Mortgage Funding and its parent company Reverse Mortgage Investment Trust have filed for bankruptcy. Inlanta Mortgage told the state of Wisconsin it plans to wind down its business. Switching gears, to celebrate the first day of December, spend 5 minutes taking one of my favorite quizzes, focused on figuring out where you’re from based on the words you use for certain common things. (What do you call the little bug that rolls up into a ball when you touch it? Sneakers versus tennis shoes? Y’all versus you guys?) It’s uncanny! What isn’t uncanny are the number of predictions we’ve heard about a recession, many dating from nearly a year ago. Recessions generally mean lower rates. Bank of America CEO Brian Moynihan says that a "mild recession" is likely next year but that concerns about a more severe downturn appear to be abating, noting households have maintained st
This morning I head to Kansas City to spend some time with the MBAKC. KC is a mere 500 miles from Oak Park, Illinois, east of Chicago and childhood home of Ernest Hemmingway. (Although Ernest Hemingway never actually used the phrase, “Wide lawns and narrow minds” when describing his childhood neighborhood, it certainly is catchy.) And KC is a hop, skip, and a jump away, which in this case is 800 miles, from Cleveland. Why do I mention this? I know it’s not even Thanksgiving yet, but fans of “The Christmas Story” movie should know that the house (and museum, and grounds) is for sale in Ohio. The inventory of houses for sale has increased in many parts of the nation, of great interest to those studying industry trends. Along those lines, not only do lenders have to compete with other lenders, and institutions snaring houses to turn into rentals, they have to contend with all cash buyers. But sage originators know that where there are homes without mortg
Forget about layoffs, salary cuts, revenue problems. There’s extra leftover candy in the lunchroom! Uh… do we still have lunchrooms? I hope so. And Thanksgiving will be here before you know it, and with it, pumpkin pie. (Yes, I know that this is a mortgage commentary, but even pumpkins have their share of regulation and controversy.) Pumpkin is a variety of squash belonging to the “Cucurbitaceae,” or gourd family which also includes melons and cucumbers. The FDA allows for sweet squash blends to be sold under the label of “pumpkin.” Libby’s, for one, uses 100% Dickinson pumpkins in its Libby’s solid pack pumpkin, not squash. Although pumpkins and squash are very closely related, Libby’s denied that it ever used a “blend” of various squashes in its popular canned pumpkin. “But the ‘Libby’s Select’ strain of Pumpkin is a variety of squash belonging to the cucurbitaceae. “The &#