Category: Mortgage Rates

Both Fannie Mae and Freddie Mac (the GSEs) have told their borrowers and mortgage servicers that they are offering immediate relief options to those affected by Hurricane Ida. The assistance is available to homeowners financed by either GSE whose homes or places of employment located in presidentially-declared Major Disaster Areas. These are localities where federal individual-assistance programs are available to affected individuals and households. Those areas are currently on the Gulf Coast, but it appears likely there will be flooding along Ida’s path into other Southern and mid-Atlantic states. On Friday, while forecasts did not fully anticipate the storm’s ultimate strength, CoreLogic, which provides data to the insurance as well as the mortgage industry, sent out the following. “CoreLogic data indicates Hurricane Ida threatens 941,392 homes across Louisiana, Alabama, and Mississippi with over $220 billion in reconstruction cost value, based on the August 27 afternoon forecast’s cone of uncertainty. Louisiana alone has 800,349 homes at risk with a reconstruction cost value of $192.65B.

While existing home sales have increased in the last two months after a four-month slump, those sales don’t look especially bright as we head into the fall and winter doldrums. The National Association of Realtors® (NAR) says pending home sales dipped modestly in July, following a 1.9 percent dip in June. Its Pending Home Sales Index (PHSI), a leading indicator of existing home sales, fell 1.8 percent from its June level to a reading of 110.7. It was the fifth time this measure, based on contracts to purchase single-family homes, townhouses, condos, and cooperative apartment, has retreated in the last seven months. The index is now down 8.5 percent from the July 2020 level of 121.0.

The number of homeowners in forbearance plans rose over the most recent week. Black Knight says a 10,000 loan increase in the number of loans serviced for bank portfolios and private label securities (PLS) accounted for most of the growth. As of August 24, there were 1.76 million loans in active plans or 3.3 percent of all mortgage loans. This is 12,000 more plan participants than at the end of the prior week. In addition to the higher number of portfolio/PLS loans, the number of FHA/VA loans increased 3,000. The volume of GSE (Fannie Mae and Freddie Mac) loans was reduced by 1,000.