Below are general real estate news headlines provided by Mortgage Daily News.  See links at right for news from major government and  industry sources.

Can Mortgage Rates Go Any Lower? Posted To: Mortgage Rate Watch Well, here we are on "hump day" and mortgage rates are still detached from the price fluctuations of the secondary mortgage market. Instead, the ups and downs of consumer borrowing costs continue to be driven primarily by the capacity constraints of major lenders, the market makers for mortgage rates. One misconception is record low mortgage rates have drawn out a hoard of "fence sitting" borrowers who are bustling with excitement to refinance. Yes, media coverage of record low mortgage rates has attracted attention from some homeowners, but the crowds just don't compare to the mini-frenzy we witnessed in early 2009. This tells us the capacity constraints of major lenders are not totally due to an increase in loan applications. With the larger lenders allocating newly...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Is There Life After the Mortgage Business? Posted To: The Garrett Watts Report We all know the mortgage business can be extremely profitable at times. We also know it can be disastrous at other times. Regulators and law makers have created an environment that makes us feel like a pin ball, bouncing aimlessly from one bumper to another Regardless of all these issues, most mortgage lending professionals stay in the business too long and never retire. I recently had the opportunity to talk to an “old timer”. He is in his mid-70s and still looking for an opportunity to manage/operate a company again. While his previous companies were well run and profitable, I was perplexed as to why he wished to do it all over again at the age of 75, especially in this environment. I had the opportunity to chat with a younger mortgage banker who had already sold a company, made...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

FHA Ready to Reduce Seller Concessions. HUD Invites Industry Comment Before Implementation Posted To: MND NewsWire HUD is preparing to implement a few new policies that will no doubt affect your pipeline/loan application process. Last week, HUD and the FHA invited public comment on three of those policy changes, which are part of FHA's strategy to "strengthen their capital reserves". The proposed changes which are either tweaks to other recent revisions or have been telegraphed by FHA and HUD in earlier Congressional testimony, notices to lenders, or press releases will: Update the combination of credit and down payment requirements for new borrowers Reduce allowable seller concessions from six to three percent. Tighten underwriting standards for manually underwritten loans FHA has been scrambling to strengthen its financial situation since an audit late in 2009 showed that the capital ratio...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Beige Book: Mixed Reads on Economy. Housing Market Definitely "Sluggish" Posted To: MND NewsWire The Federal Reserve has released the Beige Book The Beige Book is a compilation of anecdotal information and data on current economic conditions across the country. The findings are NOT THE VIEWS OF FEDERAL RESERVE OFFICIALS ...instead, each Federal Reserve bank interviews key business contacts, economists, market experts, and other sources in their specific district. This report is published eight times a year. They call it the Beige Book because its Beige . This edition was prepared at the Federal Reserve Bank of St.Louis and is based on information collected on or before July 19, 2010. Below is a summary of the findings and a few excerpts on bank lending and housing. I called attention to some of the more important observations. Economic activity has continued to increase, on balance, since...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

MBS Prices Hit New Record High After 5-Year Note Auction Posted To: MBS Commentary Mortgages are on a serious run... Front-month TBA levels set yet another new record high this morning and yield spreads continued to tighten vs. benchmarks (thx swaps!). While the street more than likely sees the current coupon in the +55/10s range, my weighting on the 4.0 has the current coupon closer to +68/10s. No matter how you slice it, mortgage valuations are rich, and everyone still wants to own agency MBS cash flows. READ WHY . It looked like we might see some directional movement yesterday, but that was a false alarm vols quickly deflated. After a few rounds of profit taking in the mid-morning hours, buyers quickly re-flooded the market, looking to take advantage of the slightest bit of weakness. In terms of origination flows, 4.50 coupons are still the most active 30yr paper. That...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Home Builder Rankings; Updates from HUD and Fannie Mae; Home Ownership Stats; FHA Sanctions; Posted To: Pipeline Press Let me start off by saying that I do not believe the rumor that the International Olympic Committee has taken back skier Lindsey Vonn's gold medal, and instead awarded it to President Barack Obama, announcing that no one has ever gone downhill faster than he has. While we're talking about going downhill, here's one list on which you do not want to your name on.... The Federal Housing Administration's Mortgagee Review Board (MRB) announced dozens of administrative actions against FHA-approved lenders who failed to meet its requirements. This year alone, the MRB took nearly 1,500 administrative sanctions against lenders, including reprimands, probations, suspensions, withdrawals of approval, and civil money penalties. READ MORE On the positive side, the folks at HUD are presenting...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Refinance Demand Takes a Break While Purchase Apps Search for Bottom Posted To: MND NewsWire The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending July 23, 2010. The MBA's loan application survey covers over 50% of all U.S. residential mortgage loan applications taken by mortgage bankers, commercial banks, and thrifts. The data gives economists a snapshot view of consumer demand for mortgage loans. In a low mortgage rate environment, a trend of increasing refinance applications implies consumers are seeking out a lower monthly payment. If consumers are able to reduce their monthly mortgage payment and increase disposable income through refinancing, it can be a positive for the economy as a whole (creates more consumer spending or allows debtors to pay down personal liabilities like credit cards). A falling trend of purchase...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

The Day Ahead: Durable Goods, Beige Book, 5-Year Notes Posted To: MBS Commentary Equity futures are flat this morning ahead of the durable goods report for June and the Federal Reserve’s Beige Book, a summary of regional economies across the country. Ninety minutes before the opening bell, Dow futures are trading 1 point higher at 10,495 and S&P 500 futures are up 0.25 points to 1111.25. The 2-year Treasury note is UNCH at 99-31 yielding 0.645%. The benchmark 10-year note is +0-04 at 103-29 yielding 3.036%. The 2s/10s curve is 2bps flatter at 239bps. The September Delivery FNCL 4.0 is +0-03 at 101-15. The FNCL 4.5 is +0-03 at 103-25. The secondary market current coupon is 1.2bps lower at 3.747%. Yield spreads are wider to start the session. Key Events Today: 7:00 ― The just-released weekly Mortgage Applications Index , a measure of mortgage loan application volume...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Mortgage Rates Still Immune to Rising Benchmark Yields Posted To: Mortgage Rate Watch A much better than expected read on New Home Sales helped the stock market post strong gains yesterday. Typically, when stocks advance, their gains come at the expense of interest rates. While benchmark Treasury yields have risen over the last week, mortgage-backed securities have managed to retain their “flight to safety” bid. MBS prices are holding steady near record highs and mortgage rates are holding steady near record lows. A "flight to safety" occurs when investors are nervous about owning risky assets like stocks but do not want to miss out on earning returns on their funds, so they move their money into risk-free U.S Treasury debt and agency MBS to provide a safe-haven AND an investment return. To remind readers, as benchmark Treasury yields fall, prices of mortgage...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Dealers Prop 2-Year Auction Demand. Assessing Lender Reprice Potential Posted To: MBS Commentary The Treasury just auctioned $38 billion 2-year notes . This auction amount is $2 billion less than the previous auction, $4 billion less than the May auction, and $6 billion less than the record $44 billion auction in April. The bid to cover ratio, a measure of auction demand, was 3.33 bids submitted for every one accepted by Treasury. This is above average but lower than the 2-year note auction in June. 88% of the issue was taken down at a high yield of 0.665%. While this is a new record low for the "high yield" at a 2-year note auction, it was still almost 1 basis point higher than the 1pm "When Issued" yield. Indicating buyside demand was lacking. Both direct and indirect bidders were awarded below average takedown percentages. Directs took 13.5% of the issue, below both...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

FHA Penalizes Over 1,000 Lenders for Violating Regulatory Standards Posted To: MND NewsWire The Federal Housing Administration's Mortgagee Review Board (MRB) has revealed a list of over one thousand lenders against whom it has taken action over the last several months for violations of the agency's program requirements. Infractions ranged from failing to notify the Department of Housing and Urban Development of changes in license status or office closures, improperly displaying FHA seals on company websites or advertising materials, and using non-employees to process loans, to failing to properly process or document credit, employment and appraisal information. The actions taken by the Board included permanent withdrawal of FHA lending authority, suspensions, and fines ranging into the high six digits. "Lenders should know by now that FHA will not tolerate fraudulent...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Buyback Risk Locks Some Borrowers Out of Refi Market; Jawboning on Fannie and Freddie; Anecdotes from the Trenches; Posted To: Pipeline Press One patient came in and said, "Doctor, I have a serious memory problem." The doctor asked, "When did it start?" The man replied, "When did what start?" That line is short and to the point. Generally speaking, markets like news when it is short and to the point - borrowers are different than traders, who are different than investors, who are different than analysts, who are different than economists. So when the Fed Chairman uses the double adjective "unusually uncertain" to describe the economic outlook, one's opinion, and how one reacts to that quote from last week's testimony, will be different. There is no question that rates are great, and much better than many had forecast for this time of year. But if the Federal Reserve doesn't know...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Housing Finance Reform Now in Focus for Obama Administration Posted To: MND NewsWire Much to the surprise of many pundits, the recently signed Financial Reform Bill did not outline guidelines for regulators to begin crafting the future of Fannie Mae, Freddie Mac, and Ginnie Mae. Although this was viewed as an oversight by most, it was the right move because it will allow our political and financial leadership to focus on FIXING THE BROKEN HOUSING FINANCE SYSTEM In April, Treasury outlined their "Housing Finance Reform" objectives . The administration's proposals will be designed to achieve four objectives. Mortgage credit should be available and distributed on an efficient basis to a wide range of borrowers. A well-functioning housing market should provide affordable housing options, both ownership and rental, for low and moderate-income households. Consumers...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Data Flash: S&P/Case-Shiller Home Price Index +0.5% in May Posted To: MND NewsWire Standard and Poor's has released the Case-Shiller Home Price Index .... 09:00 27Jul10 RTRS -US MAY HOME PRICES IN 20 METRO AREAS RISE 0.5 PCT SEASONALLY ADJ (CONSENSUS 0.2 PCT) VS 0.6 PCT IN APRIL - S&P/CASE-SHILLER 09:00 27Jul10 RTRS -US MAY 20-METRO AREA HOME PRICES RISE 1.3 PCT (CONSENSUS 0.3 PCT) VS 0.9 PCT IN APRIL - S&P/CASE-SHILLER 09:00 27Jul10 RTRS -US MAY 20-METRO AREA HOME PRICES RISE 4.6 PCT (CONSENSUS 4.0 PCT) FROM YEAR AGO - CASE-SHILLER 09:00 27Jul10 RTRS -US MAY HOME PRICES IN 10 METRO AREAS UP 0.5 PCT SEASONALLY ADJUSTED VS APRIL - CASE-SHILLER 09:00 27Jul10 RTRS -US HOME PRICES IN 10 METRO AREAS RISE 1.2 PCT IN MAY VS 0.7 PCT IN APRIL - S&P/CASE-SHILLER 09:00 27Jul10 RTRS -US MAY HOME PRICES IN 10 METROPOLITAN AREAS UP 5.4 PCT FROM YEAR AGO - S&P/CASE-SHILLER...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

The Day Ahead: Case-Shiller Home Prices, Consumer Confidence, Treasury Supply Posted To: MBS Commentary The S&P broke key resistance yesterday, this morning those advances are being extended and interest rates are trending higher. One hour before the opening bell, Dow futures are up 57 points to 10,514 and S&P 500 futures are up 6.75 points to 1,116.00. The S&P broke through it's 200 day moving average yesterday, today that level will be retested as traders look for confirmation that this was the right move. Ahead of the $38 billion 2-year Treasurry note auction, the shape of the yield curve is unchanged but yield levels have moved up across the curve. The 2-year note is -0-03 at 99-31 yielding 0.641% (+4.5bps). The 3.50% coupon bearing 10 year Treasury note is -0-12 at 103-28, 4.3bps higher in yield at 3.041%. Rate sheet influential MBS price levels are lower and yield spreads...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

What Might Move Mortgage Rates in the Week Ahead? Posted To: Mortgage Rate Watch The road got a little bumpy, but last week came to a close with consumer borrowing costs once again priced near record lows. We were expecting the ups and downs of related markets to play a larger role in the behavior of mortgage rates, but in the end, lender loan pricing strategies did not follow the directional guidance offered by mortgage-backed securities (MBS) prices in the secondary mortgage market. Instead, the movement of mortgage rates was more reflective of competition and "turn times" in the primary mortgage market. This has been a theme lately... What do we think will move mortgage rates in the week ahead? Based on shifting tones in the investing marketplace, it's tempting to say mortgage rates might finally re-attach to the movement of MBS prices in the secondary...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Rates Holding FTQ Bid as Stocks Hit Session Highs. Loan Pricing Comparison Posted To: MBS Commentary After better than expected New Home Sales data flashed, the risk trade extended its recent positive progress and benchmark interest rates are higher... S&P futures just printed a new one month high, currently +8.50 at 1109. Volume rose when S&P futures fell to 1098 support but participation has tapered off into the rally. Open interest does not reflect an increase in new long positions as much as it does forced buying in the form of short covering. Nonetheless S&Ps are holding positive progress above 1100 while the pain trade continues to play out for short sellers. The S&P 500 index (cash not futures) needs to break the 200 day moving average at 1113... Yields are higher across the curve with the biggest losses seen in the front-end where TSY auction supply is focused this...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

New Home Sales Rebound from Revised Record Low Posted To: MND NewsWire The Census Bureau and the Department of Housing and Urban Development have released New Residential Sales data for June 2010. Excerpts from the Release... Sales of new single-family houses in June 2010 were at a seasonally adjusted annual rate of 330,000 . This is 23.6 percent above the revised May rate of 267,000, but is 16.7 percent below the June 2009 estimate of 396,000 . The median sales price of new houses sold in June 2010 was $213,400.... The average sales price of new houses sold in June was $242,900.... The seasonally adjusted estimate of new houses for sale at the end of June was 210,000. This represents a supply of 7.6 months at the current sales rate. Plain and Simple : New Home Sales in June rebounded from historic lows in May. Attention should be given to the fact that May survey...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Lots of Investor Updates; Fannie HARP vs. Freddie HARP; Originator Rankings: Wells, BoA, Chase, GMAC, Citi... Posted To: Pipeline Press Someone told me, "There are three stages in a man's life: Tri-Weekly, Try Weekly and Try Weakly." At this point, banks are not shut down three times a week - yet - but only once a week, Friday's. Another handful of banks were shut down on Friday, pushing the number over 100 for the 2nd straight year. The assets and liabilities of Home Valley Bank (OR) were assumed by South Valley Bank & Trust (OR), CrescentBank & Trust (OR) went to Renasant Bank (MS), Sterling Bank (FL) is now part of Iberiabank (LA), SouthwestUSA Bank (NV) is now part of Plaza Bank (CA), Williamsburg First National Bank (SC) was incorporated into First Citizens Bank & Trust Co. (SC), Community Security Bank (MN) is now part of Roundbank (MN), and (catching my breath) Thunder Bank (KS) became part...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

The Week Ahead: Q2 GDP, New Home Sales, Treasury Auctions, Case-Shiller HPI Posted To: MBS Commentary After rising about 3.5% last week, stock markets are hesitant to continue moving higher as the week begins while interest rates are mostly unchanged. One hour before Monday’s opening bell, Dow futures are down 21 points to 10,365 and S&P 500 futures are down 2.50 points to 1,098.00. The 2-year Treasury note is UNCH at 100-02, up 0.8bps to 0.596% and the benchmark 10-year Treasury note is +0-03 at 104-10, -0.9bps at 2.992%. The September Delivery Fannie Mae 4.0 MBS coupon is +0-01 at 101-12 while the September Delivery Fannie Mae 4.5 MBS coupon is +0-00 at 103-18. The secondary market current coupon is 0.4bps lower at 3.764%. Yield spreads are slightly wider to start the week. Ahead of Friday’s look at second-quarter GDP, economists at BMO Capital Markets noted that earnings...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

The Disconnect Between the Primary and Secondary Mortgage Markets Posted To: MBS Commentary I was thinking about the disconnect between the primary and secondary mortgage markets today. I had to laugh... Agency mortgage-backed securities have enjoyed quite the rally over the last 40 days or so. Front-month delivery TBA prices have printed new record highs on a repeated basis. The street sees yield spreads near historic tights. Investor demand for TBA MBS spread product is as STRONG as ever. Loan trading desks find multiple buyers when they attempt to sell forward their pipelines. Mortgage rates are at lifetime lows and fence sitting homeowners have seen their refi option creep deeper into the money. The secondary market yearns for new loan production. There is more than enough money out there to fund a refi boom. There is a problem though... A mismatch between credit standards and...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Mining Existing Lead Sources Makes a Difference in a Competitive Environment Posted To: The Garrett Watts Report I recently visited two direct lender shops for a warehouse FOCIS review study. These lenders generated leads from two different sources: Radio and Internet Overall the two companies shared similar lead conversion rates, paid the same amount for their leads, and L.O compensation plans were comparable. There was one major difference between the two operations though, one shop originated 60% of their loan volume from their past client database while the "other company" did not. Instead, their strategy was to convert new leads into new loans and move on after closing, they did not make an attempt to mine their existing pipeline. This is a trend we've noticed lately, most of the direct lenders we've visited are doing very little marketing to their existing database. The company...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

EU Stress Test Results: Contagion Gets a Second Chance. When Will It End? Posted To: MBS Commentary Contagion gets another shot at spreading its wings today. The Committee of European Banking Supervisors has released the results of the the EU member bank stress tests. 7 of the 91 banks did not pass.The overall capital shortfall, if the "double-dip" scenario plays out, is a whopping 3.5 billion euros. Yawn. Remember what played out after the U.S. stress tests? The S&P rallied all the way into 2010. Pre-release hype was bigger than the post-release reaction. These "stress tests" are just an exercise in restoring investor confidence. The results are hypothetical and don't prove or disprove anything. If we were to get nitpicky, only 7 failed and a measly 3.5 billion euros is all that's needed to sure up the system in the event the "poo hits the fan" in...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Investor Group Challenges Loan Servicers; Loss Mitigation Recommendations; What is "WillCap" and Who is "Talcott Franklin"?; EU Bank Stress Tests Posted To: Pipeline Press History buffs know that the dollar slang term "buck" came about in the mid-1700's when deerskin was used as currency. Here in the U.S., during the Confederacy's existence, paper money was not only issued by the central Confederate government in Richmond but also by the individual Southern State governments, local municipalities, numerous private banks and even merchants. As in turns out, a recent NPR story stated that Germany now has 12 "local currencies" in circulation. The euro is now being used by 16 out of the 27 EU members, including Germany, but regional businesses are using local currencies in addition to the euro. Similar to script, the money is connected to a region - you can only spend it there - and thus promotes a "buy local" mentality. The...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

The Day Ahead: ECB Stress Tests in Focus Posted To: MBS Commentary Interest rates are trading toward the high side of their recent range as equity futures extend yesterday's gains after positive economic news out of Europe bolstered investor sentiment. British GDP almost doubled expectations by growing at a 1.1% annualized pace in the the second quarter, versus the +0.6% consensus prediction. Compared to one year ago GDP is up 1.6%. Meantime, the German IFO business climate survey jumped to a three-year high of 106.2 in July, up from 101.8 in June. One hour before the opening bell, S&P 500 futures are up 3.75 points to 1,091.50. 1090 is a key inflection point in S&P futures. The 2-year Treasury note is -0-01 at 100-03, 1.6 basis points higher in yield at 0.58%, just above newly set record lows. The benchmark 10-year Treasury note is among the worst...(read more) Forward this article via email:  Send a copy of this story to someone you know that may want to read it.