Category Archives: Financing

What Will a Trump Administration Mean to the Housing Finance Industry?

Source: RISMedia

After Donald Trump’s stunning victory on Election Day, many of us are wondering what his election might mean to the residential mortgage industry, especially considering the Trump team provided few details on housing during the campaign. The following are some perspectives:

Reduced Regulations
This is the one area where the Trump campaign did provide some indication of what the president-elect would do. Trump’s transition team has recently indicated that it would like to see a full repeal of the Dodd-Frank law, which would include the abolishment of the CFPB.  Many people think this is unlikely, but most in the mortgage industry would welcome a broad rollback of regulations. Reduced regulation would provide a number of things, some good and some not so good, depending on where you work and where you stand on issues such as subprime lending.

First, reducing or eliminating the detrimental usage of enforcement tools such as the False Claims Act could lure large lenders back to the FHA program. It would also cause many lenders to reduce underwriting overlays and open the credit box, which is needed. Secondly, reducing regulation could reverse the trend of swelling loan manufacturing costs by lowering mortgage origination expenditures associated with compliance. In theory, this would improve pricing for consumers. Finally, reducing regulations could spur a resurgence of subprime and Alt-A lending. This could be good or bad, depending on who you ask.

Subprime lending has all but vanished from the mortgage market, leaving consumers with less-than-stellar credit with few options. The reemergence of subprime lending would definitely increase overall mortgage volumes, but it could also lead to increased foreclosures and larger and more frequent real estate bubbles. Large lenders, who will be unlikely to move towards subprime, will probably counter by creating products that leverage their ability to hold certain proprietary loans on their balance sheets. This would obviously favor larger depository institutions that have the capacity to hold loans on their books. In terms of marketshare, reduced regulations will also favor big banks.

Higher Interest Rates
Higher interest rates were already in motion before Trump was elected, but the upward trend accelerated in the days following, although it’s not yet clear why. Economists generally believe that most of Trump’s stated ideas on immigration, trade, infrastructure, and tax rates will lead to bigger deficits and higher inflation. While a deficit-hating Congress could keep some of this in check, inflation and deficits equate to sharply higher interest rates.

This obviously would not be good for mortgage originations and could lead to further consolidations in the industry. Higher interest rates also favor big money-center banks, which have diversified income streams and mortgage servicing units that will see their MSR values increase. Lenders with deep pockets are in the best position to weather any downturn.

GSE Reform
This, in my view, is the biggest wild card. Some believe that Rep. Jeb Hensarling, R-Texas, chairman of the House Financial Services Committee, finally has an ally in the White House who will support his desire to dismantle Fannie Mae and Freddie Mac and eliminate any further government guarantees of conventional mortgage loans. This would be catastrophic for mortgage lending in America, causing thousands of independent lenders to go out of business and making mortgage loans available only to a relatively miniscule segment of our population. But others believe the GSEs provide billions of dollars to the Treasury each year and that Congress would never support a policy that would harm homeowners and turn off the spigot of free cash to the government.

It is difficult to anticipate how this one will play out. If Fannie Mae and/or Freddie Mac need to take a draw from the Treasury, which is likely to happen at some point, some members of Congress might see that as an indicator that it is time for the government to get out of the mortgage business. Let’s hope that cooler heads will prevail. Reforming the GSEs and creating a permanent source of liquidity for the mortgage lending industry would be good for everyone, especially independent lenders. Trump is a real estate man; he may see homeownership as a way to build communities and support our economy. He’s not someone who believes that most of us should be renters.

There is no doubt that there are a lot of questions that will remain unanswered in the coming weeks and months. What will be Trump’s position on affordable lending or FHA reform? Will he take a page from the Bush Administration and see homeownership as a vehicle to engage with minority and other underserved communities? His appointments to key housing positions at HUD and inside the White House will begin to give us some indication of what is likely to occur.

Gary Acosta is the CEO of the National Association of Hispanic Real Estate Professionals (NAHREP) and co-founder of The Mortgage Collaborative.

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Women, with Weaker Credit, Outdo Men When It Comes to Paying a Mortgage

Source: RISMedia

Female single mortgage borrowers default less on their loans than male single borrowers, despite having weaker credit, a recently released report by the Urban Institute reveals. The results of the report’s analysis show the percentage of female single borrowers who are 90 or more days delinquent is lower than that of male single borrowers—evidence that lesser credit profiles do not predicate lesser loan performance.

“Single women with mortgages are doing a better job of paying their mortgages than their credit characteristics predict,” the report’s authors state. “Because the higher price they pay for their mortgages is based on their credit characteristics when they take out the loan, this means single women borrowers are paying too much for their mortgages  .”

Related: How Single Women Are Changing the Home-Buying Market

Their conclusion is drawn from a number of findings, derived from data obtained through CoreLogic and the Home Mortgage Disclosure Act (HMDA):

Single borrowers, female and male, have lower credit scores than borrowers/co-borrowers.Between 2011 and 2014, the average FICO for a male single borrower was 739; for a female single borrower, 741. This compares to 744 for female/male borrowers and 748 for male/female borrowers. (It is important to note the analysis included data for female/female and male/male borrowers, though these were not explored in depth due to their relatively small representation.)

Single borrowers have lower incomes overall, but those of females register below those of males. From 2011 to 2014, the average income of a female single borrower was $70,200, compared to the average income of a male single borrower, $97,700. (The average incomes in that same period of a female borrower/male co-borrower and male borrower/female co-borrower were $121,300 and $129,800, respectively.)

Female single borrowers are subject to higher interest rates: 4.01 percent on loans originated in 2011 to 2014, more than the 3.99 percent for a male single borrower, the 3.97 percent for female/male borrowers, and the 3.94 percent for male/female borrowers.

Loan amounts skew lower for female single borrowers—an average $171,200 for loans originated between 2011 and 2014. The average loan amount for a male single borrower in that same period was $204,900; the average loan amount for female/male borrowers was $218,200; the average loan amount for male/female borrowers was $234,200.

Female single borrowers fall behind when weighing loan amount against income. From 2011 to 2014, a female single borrower had a 2.9 percent loan size-to-income ratio, compared to 2.6 percent for a male single borrower, 2.2 percent for male/female borrowers and 2.1 percent for female/male borrowers.

In short, female single borrowers have less substantial mortgages taking up more of their budget  . According to the results of the report, 15.6 percent of female single borrowers have higher-priced mortgages—15 percent of male single borrowers, 12.6 percent of female/male borrowers, and 7.6 percent of male/female borrowers, by contrast.

The report emphasizes female single borrowers are also denied mortgages more than their counterparts, and are more likely to be minorities living in low-income areas where more than half of residents are minorities.

All of these findings bring to stark relief the need for alternative credit risk assessment methods. The current lending landscape, according to the report’s authors, shuts single women—particularly low-income, minority women—out of means to homeownership, though they have demonstrated otherwise.

“This omission has real consequences,” the report’s authors state. “Women are generally denied for mortgages more often despite their superior payment performance…we need to develop more robust and accurate measures of risk to ensure that we aren’t denying mortgages to women who are fully able to make good on their payments.”

To view the full report, visit

Housing Recovery Continues despite Affordability Obstacles

Source: RISMedia

The national housing market has now regained enough momentum to provide an engine of growth for the U.S. economy, according to the latest The State of the Nation’s Housing report by the Joint Center for Housing Studies. Robust rental demand continues to drive the housing expansion, and sales, prices, and new construction of single-family homes are on the rise. Even more important, income growth has picked up, particularly among the huge millennial population that is poised to form millions of new households over the coming decade. At the same time, however, several obstacles continue to hamper the housing recovery—in particular, the lingering pressures on homeownership, the eroding affordability of rental housing, and the growing concentration of poverty.

The national homeownership rate has been on an unprecedented 10-year downtrend, sliding to just 63.7 percent in 2015. “Tight mortgage credit, the decade-long falloff in incomes that is only now ending, and a limited supply of homes for sale are all keeping households—especially first-time buyers—on the sidelines,” says Chris Herbert, managing director of Harvard’s Joint Center for Housing Studies. “And even though a rebound in home prices has helped to reduce the number of underwater owners, the large backlog of foreclosures is still a serious drag on homeownership.”

As these lingering effects of the housing crash fade, homeownership may regain some lost ground, but how soon and how much are open to question. Moreover, the report finds that income inequality increased over the past decade, with households earning under $25,000 accounting for nearly 45 percent of the net growth in U.S. households in 2005–2015. As Herbert sums it up, “The question is not so much whether families will want to buy homes in the future, but whether they will be able to do so.”

Mirroring the persistent weakness on the owner-occupied side is the equally long surge in rental housing demand, with increases across all age groups, income levels, and household types. With vacancy rates down sharply and rents climbing, multifamily construction is booming across the country. But with strong growth among high-income renters, so far most of this new housing is intended for the upper end of the market, with rents well out of reach of the typical renter making $35,000 a year. Because of the widening gap between market-rate rents and the amounts many households can afford at the 30-percent-of-income standard, the number of cost-burdened renters hit 21.3 million in 2014. Even worse, 11.4 million of these households paid more than half their incomes for housing, a record high. The report finds that rent burdens are increasingly common among moderate-income households, especially in the nation’s 10 highest-cost housing markets, where three-quarters of renters earning $30,000–45,000 and half of those earning $45,000–75,000 paid at least 30 percent of their incomes for housing in 2014.

Cost burdens are nearly universal among the nation’s lowest-income households. Federal assistance reaches only a quarter of those who qualify, leaving nearly 14 million households to find housing in the private market where low-cost units are increasingly scarce. Low-income households with cost burdens face higher rates of housing instability, more often settle for poor-quality housing, and have to sacrifice other needs—including basic nutrition, health, and safety—to pay for their housing. These conditions have serious long-term consequences, particularly for children’s future achievement. “And compounding these challenges,” adds Daniel McCue, a senior research associate at the Joint Center, “residential segregation by income has increased. Between 2000 and 2014, the number of people living in neighborhoods of concentrated poverty more than doubled to 13.7 million.”

The report notes that a lack of a strong federal response to the affordability crisis has left state and local governments struggling to expand rental assistance and promote construction of affordable housing in areas with access to better educational and employment opportunities through inclusionary zoning and other local resources.

“These efforts are falling far short of need,” says Herbert. “Policymakers at all levels of government need to take stock of what can and should be done to expand access to good-quality, affordable housing that is so central to the current well-being and potential contribution of each and every individual.”

To view the full report, click here.

Here’s How Much You Need to Save Each Day to Buy a Home in 15 Top Cities

Source: RISMedia

For homebuyers—especially first-time ones—what looms larger and scarier than the prospect of pulling together enough cash for a down payment? A late-stage IRS audit, maybe? A bracing swim in gulper eel–infested waters?

All wrong! The answer is nothing. For more and more Americans, the down payment has become the Everest-size mountain they need to climb to reach their dreams of homeownership—or perhaps freeze to death trying. In these days of rising home prices, it seems harder than ever to pull together that mammoth mound of moolah needed to get yourself into a new place. It can lead to desperation. Will you need to resign yourself to a lifetime of living with your parents, renting cramped apartments, or settling for the boondocks of Alaska (where you might be able to afford your own cabin sans running water)?

Actually, there is something else you can do: Whip out a calculator and start budgeting. That big lump sum you’re stressing over is a lot less intimidating when you break it down into daily payments. We can help!

The thrifty data team at® crunched the numbers for America’s 15 largest urban areas to figure out just how much buyers need to save per day to eventually purchase a home of their own. Here’s how we did it:

  1. We looked at the median home listing price in May for the country’s 15 biggest metropolitan areas and the average percentage that buyers in those areas put down on a home. Using those figures, we calculated the typical down payment for each of those cities.
  2. Next, we figured out how much potential buyers need to save each day toward a down payment, over five- and 10-year timelines, to reach their goal. (We’re making the big assumption that home prices and down payment percentages remain unchanged over that time.)

We know saving is tough. But it’s also necessary—and not just for the initial costs.

“If you haven’t been able to save up enough for a significant down payment, your saving skills may not be up to the task of paying the monthly mortgage, your insurance, your property taxes, maintenance [costs], and what we like to call your emergency fund for emergency repairs,” says Michael Corbett, the TV host of Extra’s “Mansions and Millionaires” and author of “Ready, Set, Sold!” Thanks for the pep talk, Mike!

He recommends aspiring homeowners earmark their tax refunds and annual bonuses for their down payment. They can take a part-time job on the weekends or do a little consulting work to sock away those extra shekels.

“All of this only helps you toward homeownership if you put that money away,” Corbett says. “A lot of people say, ‘I’m not going to go to Starbucks anymore,’ but they don’t take that $5 or $6 per latte and actually save it.” Hey, do you really need to drink 15 of those things a day, anyway? We thought not.

So let’s take a cross-country jaunt and start saving!

1. New York City, N.Y.
Median home price:
Average down payment: 17.2% ($71,191 on a median-priced home)
Daily saving goal (5 years): $38.99
Daily saving goal (10 years): $19.49

Prices in the City That Never Sleeps may make homeowner hopefuls want to pack up and head for cheaper parts of the country. But you’d miss out on the world-class theater, museums, restaurants, and endless career opportunities.

The median sale price for those dreaming of a Manhattan address hit a record high of about $1.1 million in the second quarter of 2016, according to the most recent Elliman report. But those willing to buy in the city’s other boroughs—even hipster Brooklyn—as well as surrounding burbs can save bundles.

2. Los Angeles, Calif.
Median home price:
Average down payment: 18.3% ($124,074)
Daily saving goal (5 years): $67.95
Daily saving goal (10 years): $33.97

It may feel like you need the salary of a movie star or, at the very least, a Flo-from-Progressive-level commercial actress to afford your own digs in Los Angeles. But fortunately for those not being stalked by the paparazzi, a recent report by the Los Angeles County Economic Development Corp. projects that key employment sectors will add thousands of jobs in the next two years: health care; construction; and professional, scientific, and technical services. And there’s even a booming neighborhood where tech startups and outposts of companies like Google and Yahoo are clustered—it’s known as Silicon Beach.

3. Chicago, Ill.
Median home price:
Average down payment: 13.4% ($35,496.60)
Daily saving goal (5 years): $19.44
Daily saving goal (10 years): $9.72

Homes have been flying off the market in this Midwestern metropolis, with prices steadily climbing to about 5 percent higher in May than they were a year earlier, according to a recent report. And why wouldn’t they? A (relatively) laid-back alternative to the coastal cities, Chicago boasts pioneering theater companies, 20 Michelin-starred restaurants, and an increasingly vibrant music scene. It’s the future home of the Obama Presidential Center. And while winters can be rough, come spring Chicagoans enjoy 8,100 acres of parkland—not to mention 26 miles of public beaches.

But the secret is out: A recent analysis by found that the downtown Loop neighborhood is one of the top 10 neighborhoods in the country for job growth, which is fueling household formation and new construction.

4. Dallas, Texas
Median home price:
Average down payment: 13.6% ($45,342.40)
Daily saving goal (5 years): $24.83

Although Dallas is in the middle of oil country, the slump in the price of crude doesn’t seem to be hurting its real estate market—at least, not yet. Home values rose 9.3 percent year over year in May, whereas the national rate was 5.9 percent, according to a recent CoreLogic report.

That makes sense as the population of the city has been growing as well (4.1 percent from July 2010 through July 2015, according to the U.S. Census Bureau), helped, no doubt, by the lower cost of living. Major companies are moving in, including Toyota, which is moving its North America headquarters from California to just outside Dallas, in Plano. The suburban city will also be home to the new regional headquarters of Fannie Mae.

5. Houston, Texas
Average down payment:
 12.7% ($42,532.30)
Daily saving goal (5 years): $23.29
Daily saving goal (10 years): $11.65

Houston’s real estate market, on the other hand, got hit much harder by the turmoil in the oil industry. But the number of homes sold began to climb again in May, although year-over-year prices bucked the national trend by staying flat, according to the Houston Association of REALTORS®.

Still, the city isn’t all about oil—it’s also home to 26 Fortune 500 companies, and a analysis last year found it was one of the top U.S. cities drawing millennial would-be home buyers.

6. Philadelphia, Pa.
Median home price:
Average down payment: 12.1% ($28,435)
Daily saving goal (5 years): $15.57
Daily saving goal (10 years): $7.79

Buying a home in the City of Brotherly Love is more affordable than in many of the other big Northeastern cities on this list, but here’s the thing: It doesn’t look like it will stay that way for long. Like the rest of the country, property prices are steadily rising.

They jumped nearly 22 percent this year alone, Kevin Gillen, senior research fellow at Drexel University’s Lindy Institute for Urban Innovation, told the Philadelphia Inquirer.

“The average Philadelphia home has achieved a new all-time high in value,” Gillen told the paper. But rest assured: It won’t approach New York levels anytime soon.

7. Washington, DC
Median home price:
Average down payment: 12.6% ($55,427.40)
Daily saving goal (5 years): $30.35
Daily saving goal (10 years): $15.18

Prices haven’t been rising quite so high in the nation’s capital as of late, and that has a lot to do with the uncertainty surrounding the presidential election, say local real estate agents. After all, whoever wins the Oval Office will determine who is placed in more than a few jobs in the city.

That’s a big reason why prices rose just 2.1 percent annually in the area in May. And by the time many aspiring homeowners save up that down payment and purchase a home, Hillary Clinton or Donald Trump might be gunning for a second term—and who knows what sort of impact that will have on real estate values!

8. Miami, Fla.
Median home price:
Average down payment: 14.1% ($49,349.99)
Daily saving goal (5 years): $27.03

Miami is known for its nonstop nightlife and Latin culture—the 2010 U.S. Census counted 70 percent of its residents as Hispanic. Located at the tip of the continental U.S., it’s no surprise that it’s known as the Gateway to the Americas, drawing people from across Latin America. The recent restoration of diplomatic ties—and soon, commercial flights—with nearby Cuba is sure to make its impact felt on the place many still call the Magic City.

But the number of sales here dropped about 10.4 percent annually in May, according to data from the Miami Association of REALTORS® provided to The Miami Herald.

Meanwhile, prices shot up as a strong dollar discouraged foreign buyers from snapping up those luxury condos at the same time that there are fewer foreclosures for investors and flippers to snap up, according to the Herald.

9. Atlanta, Ga.
Median home price:
Average down payment: 10% ($26,990)
Daily saving goal (5 years): $14.78
Daily saving goal (10 years): $7.39

Putting down roots in Atlanta, with its lower cost of living, burgeoning film industry, and usually pleasant weather, is still relatively affordable. But it may not stay that way for much longer.

The cost of purchasing a residence jumped 6.5 percent in April from a year earlier, above the national average, according to the latest S&P/Case-Shiller Home Price Indices report. That’s largely due to the lack of properties on the market at a time when more companies are moving down to the area, bringing a new crop of future Atlantans with them.

10. Boston, Mass.
Median home price:
Average down payment: 16.4% ($73,783.59)
Daily saving goal (5 years): $40.41

Home prices are steadily rising in the birthplace of the American Revolution—at the annual rate of about 5.7 percent in April compared with the same time a year earlier, according to the S&P/Case-Shiller report. That puts it right around the national average.

But hold on: Standard & Poor’s predicted in January that Boston home values will jump 24 percent by 2020! While the situation isn’t quite as bad as taxation without representation, lovers of the home of the Red SoxThe Pixies, The Freedom Trail, and Revere Beach, the country’s first public coastline park, should probably get a head start on saving as soon as possible.

11. San Francisco, Calif.
Median home price:
Average down payment: 21.8% ($190,750)
Daily saving goal (5 years): $104.46
Daily saving goal (10 years): $52.23

Holy moly! There’s no easy way to say this: Buying an abode in San Francisco ain’t cheap, so if you’re not well-off, you’d better start playing the lottery now. Some good news: While it remains one of the hottest real estate markets in the U.S., in June we started to see higher-priced homes flying off the market just a wee bit slower than before—perhaps a sign that the tide is finally turning.

Still, buyers shouldn’t hold their breath waiting for prices to soften on the city’s “affordable” residences. It might be a better plan to work on creating the next Snapchat. How hard could it be?

12. Detroit, Mich.
Median home price:
Average down payment: 12% ($24,000)
Daily saving goal (5 years): $13.14
Daily saving goal (10 years): $6.57

Buying a home in the former automotive manufacturing hub won’t set buyers back too much these days. Also, according to our calculations, it’s one of the U.S. cities where you can pay your mortgage off the fastest. Even so, interested buyers might want to get moving sooner rather than later.

In recent years, Detroit has been experiencing a resurgence as more startups, shops, and restaurants are moving in. That’s likely to lead to higher prices, so cash-strapped buyers should buy a home while they still can.

13. Phoenix, Ariz.
Median home price:
Average down payment: 11.9% ($36,771)
Daily saving goal (5 years): $20.14
Daily saving goal (10 years): $10.07

Plenty of buyers may still be able to swing the home prices in Arizona’s capital area, but they are going up—prices rose about 5.5 percent, according to the S&P/Case-Shiller report.

Still, you’ll get more bounce for the ounce than elsewhere. Our analysis found that Phoenix-area municipalities of Gilbert, Chandler, and Scottsdale offer some of the largest homes in America, and they’re likely to be relatively new construction as well. Speaking of Gilbert, it also made our list of boom towns with notable job growth, while Chandler is home to the satellite offices of several major tech companies.

14. Seattle, Wash.
Median home price:
Average down payment: 13.3% ($59,185)
Daily saving goal (5 years): $32.41
Daily saving goal (10 years): $16.21

Home prices here have been rising far faster than the national average. Seattle prices shot up 10.7 percent in April compared to the same time a year earlier, according to the S&P/Case-Shiller report.

Bidding wars have also been driving up the cost of homeownership, as about three-quarters of Seattle-area residences have been receiving multiple offers, according to a recent Seattle Times article. In a testament to how crazy it’s become, last month, more than 100 people were lined up, some of them having slept there overnight, to plunk down deposits on condos that haven’t even broken ground yet, according to the Times.

15. Minneapolis, Minn.
Median home price:
Average down payment: 11.2% ($32,928)
Daily saving goal (5 years): $18.03
Daily saving goal (10 years): $9.02

Even in the reasonably priced twin cities of Minneapolis and Saint Paul, prices rose 5.7 percent year over year in May—hitting their highest levels since well before the housing bubble burst in June 2006, according to the latest Minneapolis Area Association of REALTORS® report. And they can only be expected to keep on climbing.

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Mortgage Applications Rise over 9 Percent

Source: RISMedia

Mortgage applications increased 9.3 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending June 3, 2016. Results include an adjustment to account for the Memorial Day holiday.

The Market Composite Index, a measure of mortgage loan application volume, increased 9.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 13 percent compared with the previous week. The Refinance Index increased 7 percent from the previous week. The seasonally adjusted Purchase Index increased 12 percent from one week earlier. The unadjusted Purchase Index decreased 12 percent compared with the previous week and was 6 percent lower than the same week one year ago.

The refinance share of mortgage activity decreased to 53.8 percent of total applications from 54.3 percent the previous week. The adjustable-rate mortgage (ARM) share of activity remained unchanged at 5.0 percent of total applications.

The FHA share of total applications increased to 13.0 percent from 12.5 percent the week prior. The VA share of total applications decreased to 11.5 percent from 12.0 percent the week prior. The USDA share of total applications remained unchanged from 0.7 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) decreased to 3.83 percent from 3.85 percent, with points decreasing to 0.33 from 0.36 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate decreased from the last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,000) remained unchanged at 3.81 percent, with points decreasing to 0.25 from 0.35 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from the last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 3.71 percent from 3.65 percent, with points decreasing to 0.23 from 0.26 (including the origination fee) for 80 percent LTV loans. The effective rate increased from the last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.11 percent from 3.12 percent, with points decreasing to 0.35 from 0.40 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from the week prior.

The average contract interest rate for 5/1 ARMs decreased to 2.96 percent from 3.00 percent, with points decreasing to 0.29 from 0.44 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from the last week.

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Cybercrime Hitting Real Estate – Beware of Scams!

Source: RISMedia

Online criminals are targeting the real estate industry and stealing large sums of money from unwary homebuyers. This fraud can destroy real estate transactions, so the National Association of REALTORS® is urging real estate professionals across the country to immediately implement safety measures to reduce the risk of becoming a victim

In a typical scenario, a criminal will hack into the email account of the person involved in an upcoming real estate transaction. The hacker will then send a sham email to the buyer, or another individual who will be wiring transaction-related funds. The email will state that there has been a last-minute change to the wiring instructions. Following the new instructions
contained in the email, the recipient will then wire the money directly to the hacker’s account, which will be cleared out in a matter of minutes. The money is almost always lost forever.

Most email users today can easily recognize the email scams that are rife with poor spelling and grammatical oddities. In contrast, the fraudulent emails being utilized in this wire scam are virtually indistinguishable from legitimate communications. Because hackers are gaining access to the email accounts of individuals directly involved in the transaction, they’re able to include detailed information in their fraudulent emails, including key names, dates, and mocked-up signature lines.

There are a number of measures that real estate agents and others involved in real estate transactions can take to help keep themselves and clients from falling victim to this crime. First, from the outset of any deal, inform all parties to the transaction of this ongoing scheme, to ensure that everyone stays alert to suspicious activity. Second, request that all parties implement reasonable security practices throughout the course of the transaction, such as only using confirmed telephone numbers or face-to-face communication to share sensitive financial or personal information. As a final failsafe, immediately prior to wiring any money, the person initiating the wire should call the intended recipient via a verified
telephone number to confirm the wiring instructions.

Other important steps to avoiding exposure to email fraud include:

  • Never conduct business over unsecured WiFi.
  • Clean out email accounts on a regular basis
  • Change email passwords on a regular basis
  • Implement complex passwords with a combination of letters, numbers, and special characters.
  • Implement the most up-to-date firewall and anti-virus technologies.

If a fraudster has successfully infiltrated a transaction, NAR says:

  • If money has already been wired via false wiring instructions, immediately call all banks and financial institutions that could possibly stop the wire.
  • Contact your local police.
  • Contact all parties who may have been exposed during the attack so that they take appropriate action.
  • Change all passwords.
  • Report the activity to the FBI via their Internet Crime Complaint Center.

This advice is not all-inclusive, and real estate professionals should work with information technology and cybersecurity professionals to ensure that their email accounts, online systems, and business practices are as secure and up-to-date as possible.

Pending Home Sales Reach Highest Level in Nearly 12 Months

Source: RISMedia

Pending home sales increased slightly in March for the second consecutive month and reached their highest level in almost a year, according to the National Association of REALTORS®. Only the West region saw a decline in contract activity last month.

The Pending Home Sales Index, a forward-looking indicator based on contract signings, climbed 1.4 percent to 110.5 in March from a downwardly revised 109.0 in February and is now 1.4 percent above March 2015 (109.0). After last month’s slight gain, the index has increased year-over-year for 19 consecutive months and is at its highest reading since May2015 (111.0).

Lawrence Yun, NAR chief economist, says last month’s pending sales increase signals a solid beginning to the spring buying season.
“Despite supply deficiencies in plenty of areas, contract activity was fairly strong in a majority of markets in March,” he says.
“This spring’s surprisingly low mortgage rates are easing some of the affordability pressures potential buyers are experiencing and
are taking away some of the sting from home prices that are still rising too fast and above wage growth.”

Economic News: Home Price Gains, Job Growth Steady


“Heigh-ho, heigh-ho, it’s off to work we go.” The Seven Dwarfs. A strengthening jobs market and low home rates are digging up demand for limited housing inventory. Meanwhile, home price gains hold steady.

The S&P/Case-Shiller 20-city Home Price Index rose 5.7 percent year-over-year from January 2015 to January 2016. This was in line with estimates and matched December’s 5.7 percent gain. Prices were up 0.8 percent month-over-month. The low inventory of homes available for sale has been the key reason for price growth; more Americans working also has fueled demand.

On the labor front, the Bureau of Labor Statistics reported that 215,000 jobs were created in March, above the 200,000 expected, though down from the 245,000 created in February. While the Unemployment Rate edged higher to 5 percent from 4.9 percent, the report was positive, signaling that despite global economic woes, job growth here in the U.S. remains solid.

At this time, home loan rates continue to hold steady as well, hovering just above historic lows.


In a light report week, investors will scour the words of the Fed’s meeting minutes looking for clues regarding the next hike to the benchmark Fed Funds Rate.

  • On Tuesday, the ISM Services Index will be released.
  • Wednesday brings the March Federal Open Market Committee meeting minutes.
  • Weekly Initial Jobless Claims will be delivered on Thursday.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve. In contrast, strong economic news normally has the opposite result.

If you or someone you know has any questions about the housing market, current rates or home loan products, I would be happy to help. Please don’t hesitate to email or call me.

Michelle Wickett
Senior Loan Originator
Axia Home Loans | NMLS 27830
Phone: (360) 791-0513
Fax: 360-459-1212
License:: NMLS 62804




































































“Heigh-ho, heigh-ho, it’s off to work we go.” The Seven Dwarfs. A strengthening jobs market and low home rates are digging up demand for limited housing inventory. Meanwhile, home price gains hold steady.

The S&P/Case-Shiller 20-city Home Price Index rose 5.7 percent year-over-year from January 2015 to January 2016. This was in line with estimates and matched December’s 5.7 percent gain. Prices were up 0.8 percent month-over-month. The low inventory of homes available for sale has been the key reason for price growth; more Americans working also has fueled demand.

On the labor front, the Bureau of Labor Statistics reported that 215,000 jobs were created in March, above the 200,000 expected, though down from the 245,000 created in February. While the Unemployment Rate edged higher to 5 percent from 4.9 percent, the report was positive, signaling that despite global economic woes, job growth here in the U.S. remains solid.

At this time, home loan rates continue to hold steady as well, hovering just above historic lows.

If you or someone you know has any questions about the housing market, current rates or home loan products, I would be happy to help. Please don’t hesitate to email or call me.

Yellen Says Fed To Continue Rates With Caution

Source: RISMedia


U.S. stocks increased on Tuesday after Janet Yellen, Federal Reserve Chairwoman, noted in a speech that the Fed would proceed with caution when it comes to interest rate hikes.

During her speech at the Economic Club of New York, Yellen noted the Fed will move precariously based on issues such as low inflation and the overall weak global economy.

“Given the risks to the outlook, I consider it appropriate for the (Fed’s policymaking committee) to proceed cautiously in adjusting policy,” Yellen said.“This caution is especially warranted because, with the federal funds rate so low, the FOMC’s ability to use conventional monetary policy to respond to economic disturbances is asymmetric. If economic conditions were to strengthen considerably more than currently expected, the FOMC could readily raise its target range for the federal funds rate to stabilize the economy.”

These comments echo the Fed’s announcement early in March that it plans to halve its rate hikes this year, from four to two.

Read Yellen’s entire speech here.

ALERT: New scam robbing home buyers of closing funds


by Ryan Smith22 Mar 2016


The Federal Trade Commission and the National Association of Realtors have issued a warning originators might want to pass on to their buyers.

According to the FTC and the NAR, there’s a mortgage-closing phishing scam going around that could leave buyers without a down payment. The scam involved hackers breaking into the email accounts of real estate professionals and consumers to access information about home buyers’ closing dates.

Once the hacker has the closing date, he’ll send an email to the buyer posing as the real estate professional or title company, according to the NAR. The scammer will say there’s been a “last-minute change” to the wiring instruction for closing funds and instruct the buyer to send the funds to a different account. That account, of course, really belongs to the hacker.

According to the FTC, buyers who fall prey to this scam could find their bank account cleaned out in “a matter of minutes” – and it’s unlikely they’ll ever see that money again.

“If you’re buying a home and get an email with money-wiring instructions, STOP,” the FTC stated in a bulletin on the scam. “Email is not a secure way to send financial information, and your real estate professional or title company should know that.”

“Buyers should be wary of sending financial information over email, downloading attachments, or responding to email requests to wire money in a real estate transaction,” said NAR President Tom Salamone.

The FTC’s top tips to avoid phishing scams

Here’s what the FTC has to say about avoiding falling prey to scams like this one:

  • Don’t email financial information. It’s not secure.
  • If you’re giving your financial information on the web, make sure the site is secure. Look for a URL that begins with https (the “s” stands for secure). And instead of clicking a link in an email to go to an organization’s site, look up the real URL and type in the web address yourself.
  • Be cautious about opening attachments and downloading files from emails, regardless of who sends them. These files can contain malware that can weaken your computer’s security.
  • Keep your operating system, browser, and security software up to date.