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UTPhil2006

By UTPhil2006
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Loch Ness Monster

Loch Ness Monster 3533

Posted
Posted
2 hours ago, Wulaw Horn said:

This is why people hate Mr. Cooper. I had the exact same experience with them 10 years ago when they got my mortgage so I managed to get out in front of it the next time they ended up servicing my mortgage like 3 years ago.  They are utterly incompetent.  

A large percentage of their hiring strategy is getting 22 year olds fresh out of college for dirt cheap and training them up. Anyone talented eventually gets poached by a competitor. At least Mr Coopers shareholders are happy I guess.

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mchookem
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alrighty...i haven't wanted to jinx anything so i've been pretty quiet... but we just closed on our new home in Denver this morning so i can now officially say YEAH! 😃 in a nutshell - we sold

Esque
Esque

Thank you for this - gave me a good laugh.  But also a good reminder of how the general public does not understand what is going on in real estate and thus why so many get caught offsides when the tid

Neonmoon
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Realtor: You should list your house at 500K Client: But three houses down the street sold for 700K Realtor: Yeah, but those are overvalued due to pandemic Fed policy and institutional invest

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TurkeyChew

TurkeyChew 383

Posted
Posted
1 hour ago, Wulaw Horn said:

Yeah. It might bring the people who need just a small push into compliance - especially the part timers, and that will definitely help us in the lending business.  The lady that was like- yeah- I teach piano and make $5,000 a year as a side hustle that now gets religion on reporting might actually have income to show and use now.  I have zero belief that it will lead to a lot of revenue for the government.  The people currently cheating will continue to cheat, people will stop using cash transfer apps if they are going to report to the IRS and people trying to comply will be further hassled. 

Time for you to name names, Benes.

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Wulaw Horn

Wulaw Horn 19073

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Down 44 basis points today in the MBS market. Opening price worse than last night and then 2 reprices for the worse a couple hours apart during the afternoon. 
I tbought this had ended when we had 2 ok days in a row. Thursday afternoon and Friday have told me that we haven’t hit bottom yet, I guess. 

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Dbeasy

Dbeasy 15052

Posted
Posted
12 minutes ago, Wulaw Horn said:

Down 44 basis points today in the MBS market. Opening price worse than last night and then 2 reprices for the worse a couple hours apart during the afternoon. 
I tbought this had ended when we had 2 ok days in a row. Thursday afternoon and Friday have told me that we haven’t hit bottom yet, I guess. 

Can you clarify what this means for those of us not in the mortgage business?

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UTPhil2006

UTPhil2006 3807

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12 minutes ago, Wulaw Horn said:

Down 44 basis points today in the MBS market. Opening price worse than last night and then 2 reprices for the worse a couple hours apart during the afternoon. 
I tbought this had ended when we had 2 ok days in a row. Thursday afternoon and Friday have told me that we haven’t hit bottom yet, I guess. 

I’m just gonna hold out hope that something globally, financially, etc may happen to put a stop to this skid 

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Wulaw Horn

Wulaw Horn 19073

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5 minutes ago, Dbeasy said:

Can you clarify what this means for those of us not in the mortgage business?

Every 50 basis points, as a general rule, equates to 1/8 of a point in interest rate to the borrower. 
when MBS (mortgage backed securities) go up the interest rates go down. When they go down, interest rates go up. So, we are down approximately 200 points in the MBS market since (checks watch) January 3rd. Lending rates are a full half point (more or less) higher than they were to end last year. That’s a beat down in the span of 2 weeks. 
they were up about 3/8 of a point Tuesday’s morning but then we clawed back to parity Tuesday afternoon, Wednesday and Thursday morning and the hope was that the hemorrhage had stopped. But then we lost another 1/8 of a point, no support levels in sight and it looks like nobody can tell where this will end. 
 

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Neonmoon

Neonmoon 38129

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16 hours ago, Wulaw Horn said:

no support levels in sight and it looks like nobody can tell where this will end. 

We going up. With the Fed raising rates in March, the direction is up. Is the market pricing those in right now essentially? Possibly. Maybe a weak ass jobs report in early February could lessen it, but right now, the signal is Omnicron might be the end of the shitshow, which just means more gas to the engine. 

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Wulaw Horn

Wulaw Horn 19073

Posted
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21 minutes ago, Neonmoon said:

Here is the Mortgage Bankers Association Forecast

image.png.756fda387de00e44090184a38b8ac914.png

Those clowns are never right. Maybe I just remember when they are way off. 
4 at the end of the year seems kind of aggressive to me (or I would have said so 2 weeks ago) but who knows. I’d be shocked if we rock a 3.0% inflation by end of the year. 

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Wulaw Horn

Wulaw Horn 19073

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2 hours ago, Neonmoon said:

Any chance of a brief respite in rates this week? Have some people wanting to lock 

Is there a chance?  Sure. My guys are saying we haven’t hit support levels even yet and are betting on it getting worse. They aren’t always right but they are right often enough that I listen. 

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DFWTexEx

DFWTexEx 276

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So, we are thinking of making a lifestyle choice and selling our 100+ year old house in a historic district and moving into a new construction townhome to get closer to a lock and leave lifestyle.  As much we love our house and our neighborhood, the endless repairs and issues have finally gotten to me.   Getting into a townhome community scares the shit out of me because I won't control everything.  I have seen the HOA declarations and even though I am a lawyer, I don't know what to make of it.  

We are just starting the process and meeting our buyer's agent this week. I am sure she will be able to help answer some questions, but any tips?   I know tons of people buy into these communities so it can't be as bad or scary as I think.  Anything in particular I should look for or ask for in the warranties?  Is everything negotiable?

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Gil Bang

Gil Bang 25960

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when you say "warranties", is that lawyerspeak, or do you mean the actual home warranty?

The biggest thing you should be worried about is the solvency of the HOA.  Are the HOA fees too high?  High enough?  The last thing you want is to be hit with a special assessment down the road because the HOA doesn't have enough cash reserves for a needed project. 

 

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Redneck Mutha

Redneck Mutha 7962

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3 hours ago, DFWTexEx said:

We are just starting the process and meeting our buyer's agent this week. I am sure she will be able to help answer some questions, but any tips?   I know tons of people buy into these communities so it can't be as bad or scary as I think.  Anything in particular I should look for or ask for in the warranties?  Is everything negotiable?

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PhillyD

PhillyD 1257

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It's going to be hard to speak to owners about whether they like the HOA since it's a new townhome community.  You said it scares the shit out of you not being able to control everything.  That's a red flag, but you're aware of it.  In the worst case, how upset will you be if you have an overzealous HOA member who measures the height of your mailbox?  Can you live with that?  Can you live within the ordinary rules of most HOA's that don't have an overzealous board member?  If the answer is yes, you're probably ok.  The green flag you stated is that you currently live in a historic district.  In most historic districts, you have to have approval to do certain types of renovations or exterior changes.  You will have the same experience in an HOA in that you need to gain approval to do certain things.

What Gil said about the solvency about the HOA is very important.  New HOA's can be a crapshoot.  Some developers are great, but others will understate the fees because they want to present low HOA fees to new buyers.  If possible, see if the developer has developed any other HOA's and see if you can talk to a board member at one of those HOA's.  Did the developer fully fund reserves during the initial operating period when the developer had control?  Did they have a smooth transition from developer to HOA?  Did they have to sue the developer to get what they needed?

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DFWTexEx

DFWTexEx 276

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Quote

when you say "warranties", is that lawyerspeak, or do you mean the actual home warranty?

The builder provides three tiers of warranties:  1 year "bumper to bumper", fixtures, materials, etc. except for wear and tear type stuff; 2 years for systems (HVAC, plumbing, electrical; 10 years for major structural stuff (foundation, beams, load bearing walls, roof framing, etc.).  Not sure if these are standard or if there red flags / details I should look for. There don't seem to be any service level standards for repairs, which bothers me.

Quote

The biggest thing you should be worried about is the solvency of the HOA.  Are the HOA fees too high?  High enough?  The last thing you want is to be hit with a special assessment down the road because the HOA doesn't have enough cash reserves for a needed project.

Yes.  There is some concern here.  There are not a lot complicated common area things.  It's basically a pool, landscaping, gates and the interior driveways.  These should all be pretty new so I can't see major expenses to repair or replace these things in the near future.

Quote

Can you live within the ordinary rules of most HOA's that don't have an overzealous board member? 

I am not too worried about HOA enforcement issues. I know what I am getting into and expect enforcement of the standards.  Having lived in a historic district, I am ok with rules about what I can do to the exterior of my house.   I am more worried about understanding how the finances of the HOA work so that there are no surprises later. Are the reserves right.

One thing not mentioned yet, is how I deal with neighbors with whom I share a building.  The HOA does not have responsibility for the buildings.  My unit will be in a bank of 4 all owned in fee simple.   If repairs have to be made to the roof, the common walls, etc., who manages this and how do you share costs?  What if one neighbor doesn't want to participate?  I need to look into the HOA declarations and see how we can force them.

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Gil Bang

Gil Bang 25960

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Posted (edited)

So, as to the "bumper to bumper" warranty, you have a lot more leverage BEFORE closing than you do afterwards.  Most folks don't have an eye for details right away, and will start noticing shit after they move in.  I'd suggest that you hire an experienced inspector for the walk-thru inspection, and refuse to close escrow until all items are corrected and re-inspected.  I happen to have a really good eye for shit. One of my clients is an investor who does fix and flip stuff...does no work himself, uses contractors.  Every time he tells me that he has one ready to list, I go over, and I find about 15 things that look like shit and/or are unfinished.  I do the blue tape thing all over the fucking house. 

As to the shared walls and roof, I've seen similar situations where the roof is replaced over 1 unit only.  I'd be more concerned about shared attic space, and I'd make sure that firewalls are present in the attic. 

Edited by Gil Bang
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Wulaw Horn

Wulaw Horn 19073

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Barry Habib sounded like he was going to cry during the VM update to lock I got. 
Big sigh, we’re just in the middle of a really bad run guys, don’t know how else to say it. Lock Em up and do the best you can. 
Ughhh. Knew this was coming eventually just wanted to see it unfold over the course of 6 months- not 6 days. 

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Gil Bang

Gil Bang 25960

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12 minutes ago, UT_OB1 said:

I agree, that’s what I include in the list of drawbacks. Don’t you have the same thing with association feeds with condos?  And you still pay property taxes. 

Association fees, well, they aren't just a money grab.  The HOA usually provides "something" of value.  My last HOA deal, the HOA provides water, trash, basic cable, grounds maintenance, pool, clubhouse, etc. 

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Neonmoon

Neonmoon 38129

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3 hours ago, UT_OB1 said:

I agree, that’s what I include in the list of drawbacks. Don’t you have the same thing with association feeds with condos?  And you still pay property taxes. 

Again, it’s renting v buying. Most people would rather deal with some drawbacks than set their money on fire. 

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Guest Lobo

Guest Lobo

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Sitting at a conference on CRE.  One guy took us in a weird direction but raised some questions with regarding to Outco/Propco overlay.  

what's the deal with this "Home Equity Shared Coinvestment"?  Sounds like a 10% direct payment of equity back to homeowner in exchange for a mid-teens clip on sale/reverse mortgage?  Sounds geared towards seniors who want to age in place (which would shit on the senior living space obvously---but I don't care about that right now).  it's obviously very different from a reverse mortgage, but any general opinions on these?  

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Wulaw Horn

Wulaw Horn 19073

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https://www.cnbc.com/2022/01/19/homebuyers-are-rushing-to-get-mortgages-before-rates-move-even-higher.html
 

this is something not captured in my charts- the average points on the 30 year with 20% down is 0.45 discount points. That moves the number even higher than the 3.64 mentioned in the article from a practical perspective 

interest rates (to consumer) up 0.72% from last year at this time. Considering how low they were that’s a 25% increase. 
market rallying today to see if we get a dead cat bounce. This is in the overall trend toward higher rates but I will take literally any calm in the storm right now- even if it’s just for a day or two and enough to catch our breath for a minute. 

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jimmyjazz

jimmyjazz 45962

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1 hour ago, Lobo said:

Sitting at a conference on CRE.  One guy took us in a weird direction but raised some questions with regarding to Outco/Propco overlay.  

what's the deal with this "Home Equity Shared Coinvestment"?  Sounds like a 10% direct payment of equity back to homeowner in exchange for a mid-teens clip on sale/reverse mortgage?  Sounds geared towards seniors who want to age in place (which would shit on the senior living space obvously---but I don't care about that right now).  it's obviously very different from a reverse mortgage, but any general opinions on these?  

Not sure I understand -- it's a program where (for instance) the bank loans someone 10% of their equity, and the total due is 15% down the road, regardless of term?  That's an 8.5% rate if paid back in 5 years, 4% if paid back in 10 years.  Doesn't seem terribly onerous.  I guess they're competing with cash out refis, so they can't just assign a fixed rate higher than market.

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Neonmoon

Neonmoon 38129

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1 hour ago, Wulaw Horn said:

https://www.cnbc.com/2022/01/19/homebuyers-are-rushing-to-get-mortgages-before-rates-move-even-higher.html
 

this is something not captured in my charts- the average points on the 30 year with 20% down is 0.45 discount points. That moves the number even higher than the 3.64 mentioned in the article from a practical perspective 

interest rates (to consumer) up 0.72% from last year at this time. Considering how low they were that’s a 25% increase. 
market rallying today to see if we get a dead cat bounce. This is in the overall trend toward higher rates but I will take literally any calm in the storm right now- even if it’s just for a day or two and enough to catch our breath for a minute. 

Most borrowers do not realize the discount points in fine print below the amazing internet offer. 

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Wulaw Horn

Wulaw Horn 19073

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Can’t tell you how many times I’ve had a Quicken quote thrown back to me with “but Wulaw- they are 1/8 of a point lower than you” only to see the borrower paying 1.75% in discount points and I just laugh and laugh and laugh. 
yeah dude- if you want to stroke me a check for almost 2 points discount I can do about 1/2 a point better than that. You sure you want to pay discount points?  It’s generally a suckers bet outside of investment property and sometimes Jumbo….

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UTPhil2006

UTPhil2006 3807

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1 hour ago, closetohumping said:

I was dealing with this idiot who sent me a quote with the rate I want but I had to buy it down with 30k.  I called him on it and he said "wait, let me work my magic."

Sadly that's more common than not.  I'll have borrowers email me and be like hey can you match xxx% and I'm like theres no way I'm getting beat that bad.. so I'll ask them to send me their quote from their lender and sure enough theres 1-3 points of buy down.  Sure if you want to spend that let me show you how I can now beat him by .25

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Blotto

Blotto 23523

Posted
Posted (edited)

Stumbled across this chart earlier

image.thumb.png.1e173f2604ab47e9f4971c01980e5a3d.png

The peak at the housing bubble was 7.0 , and we are now at 7.28.

In inflation adjusted dollars

image.thumb.png.1c4f88d666bb1c890a09eaa025b26154.png

Its crazy how long the average cost of a house hovered between 150K to 200 K, and now we're closing in on $350K. I'm sure this time will be different. 

 

Edited by Blotto
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LCHorn

LCHorn 2620

Posted
Posted
5 minutes ago, Blotto said:

Stumbled across this chart earlier

image.thumb.png.1e173f2604ab47e9f4971c01980e5a3d.png

The peak at the housing bubble was 7.0 , and we are now at 7.28.

In inflation adjusted dollars

image.thumb.png.1c4f88d666bb1c890a09eaa025b26154.png

Its crazy how long the average cost of a house hovered between 150K to 200 K, and now we're closing in on $350K. I'm sure this time will be different. 

 

Well, the difference is that the shortage is due to scarcity and not speculation.  @Wulaw Hornlikely already read Habib today and this is stolen from him, but there’s less than a fourth of the inventory available in 2007 and preceding the bubble popping. 
 

I may have a skewed sense of scale because I am in Austin, but there is just SO much money floating around from all the tech workers and most of them are young and buying a home or upgrading.  

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Wulaw Horn

Wulaw Horn 19073

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Posted
8 minutes ago, LCHorn said:

Well, the difference is that the shortage is due to scarcity and not speculation.  @Wulaw Hornlikely already read Habib today and this is stolen from him, but there’s less than a fourth of the inventory available in 2007 and preceding the bubble popping. 
 

I may have a skewed sense of scale because I am in Austin, but there is just SO much money floating around from all the tech workers and most of them are young and buying a home or upgrading.  

Yessir.  This is exactly right.  After the last housing bubble bust and the great recession we just stopped building homes, and in Texas we keep adding people.  I've messed around talking through this with @Scipio and I think we are short something like 500,000 units in the I35 corridor alone between San Antonio and the Border. I think he thinks I'm crazy and that's too high, but I'm not sure man- that area just has so much growth- would it really surprise anyone if there was demand to put another 1.3 or 1.7 million people in homes along that corridor?


I have no idea- I'm literally guessing like the famous B School or interview question where they ask how many Coca Cola's were sold in NY b/c they want to see your thought process not b/c they care about an actual number.   But yeah, inventory is crazy scarce.  The most expensive cities for home ownership are either limited by geographical factors or zoning/governmental factors or some combination thereof.

I got a little tear reading a progessive article talking about how all cities should be like Houston and ditch zoning to fix the housing affordability crisis. I always love it when I can find common ground to agree with a progressive (this is sincere), it makes me feel good about the idea that there can be people coming at a problem from a different perspective and come to a similar answer.  It's an antidote, for me, from the idea that all politics have to be divisive that we see so much.  But yeah up demand, restrict supply and you squeeze the balloon and it has no choice but to inflate.   

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