All Encompassing Mortgage and Real Estate Thread

[Vegas64 713]

Demand for mortgages hit the lowest point in 22 years last week. Mortgage applications and refi demand were down 21% and 75% YoY.

Wow. Do you think we will see massive layoffs in the sector?

[Wulaw Horn 19579]

52 minutes ago, Vegas64 said:

Demand for mortgages hit the lowest point in 22 years last week. Mortgage applications and refi demand were down 21% and 75% YoY.

Wow. Do you think we will see massive layoffs in the sector?

Hope I don’t starve to death. At least I have my exposure limited by also owning a title company. 
Gulp. 
we will be fine. I have to imagine a bunch of people exit the industry. It’s just the nature of the business. Boom and bust. Pros stay. Guys in it during the good times only don’t. 

[Pato del Muerto 53451]

The people that do their job well should have done enough business the last few years to have a referral pipeline so that they get their share of the business that is left. 

[DefinitelyNotHollywoodColt 12301]

no idea what to do with money at this point, and i know the book says you get better returns elsewhere on a 2.5% mortgage, but decided to accelerate our payment schedule on our house. 28.5 years left on the loan, will have it paid off in under 7. 

[Neonmoon 38130]

2 hours ago, Vegas64 said:

Demand for mortgages hit the lowest point in 22 years last week. Mortgage applications and refi demand were down 21% and 75% YoY.

Wow. Do you think we will see massive layoffs in the sector?

There have already been mass layoffs in the sector. Better.com, Wells Fargo, Mr. Cooper, LoanDepot, Fairway, Pennymac, NewRez LLC, Guaranteed Rate, Movement, 

Layoffs mostly hit back office. Underwriting, Processing, Credit Policy, etc, because LOs are mostly commission. Don't cost nothing to have them around. If they can't feed themselves, they starve. 

Same with realtors this year. You will see many realtors "exit" the business because not enough to feed everyone. 

[CHIEF 5223]

11 minutes ago, Neonmoon said:

There have already been mass layoffs in the sector. Better.com, Wells Fargo, Mr. Cooper, LoanDepot, Fairway, Pennymac, NewRez LLC, Guaranteed Rate, Movement, 

Layoffs mostly hit back office. Underwriting, Processing, Credit Policy, etc, because LOs are mostly commission. Don't cost nothing to have them around. If they can't feed themselves, they starve. 

Same with realtors this year. You will see many realtors "exit" the business because not enough to feed everyone. 

Happened to a buddy of mine from college. Even if he picked up a listing, his broker requires that the listing is hers, and it is up to her agents to find a buyer. That's a crock of shit. Buyer agents are dropping like flies. Luckily, he owns three daycare centers and just bought a stone and rock supply business. He was hitting me up to use him whenever I go back to building and I found out he was not doing real estate at this time. Listing agents are still feasting, and buyer agents are starving, and have been for over a year.

CHIEF

[Hefeweizen 5443]

Can I do better on a jumbo in California than 4.875 with no points right now?  I’m working with someone who isn’t Thad and Phil so I’m not as warm and fuzzy.  
 

And frankly it’s bullshit that a jumbo is a lower rate than conventional.  You are telling me to borrow more to pay less interest?

 

For what it’s worth I think the market out here (Monterey peninsula) is softening, but I can’t wait because the rental I am in may make me go nuts.

[Gil Bang 26230]

Happened to a buddy of mine from college. Even if he picked up a listing, his broker requires that the listing is hers, and it is up to her agents to find a buyer. That's a crock of shit. Buyer agents are dropping like flies. Luckily, he owns three daycare centers and just bought a stone and rock supply business. He was hitting me up to use him whenever I go back to building and I found out he was not doing real estate at this time. Listing agents are still feasting, and buyer agents are starving, and have been for over a year.
CHIEF

I am one of the buyers agents that is suffering. It’s been a rough year for me and I don’t expect it to get better anytime soon. Fortunately, I’ve got some connections in the REO world so I’m hoping that if things go to shit, I can work that angle.

[Gil Bang 26230]

Can I do better on a jumbo in California than 4.875 with no points right now?  I’m working with someone who isn’t Thad and Phil so I’m not as warm and fuzzy.  
 
And frankly it’s bullshit that a jumbo is a lower rate than conventional.  You are telling me to borrow more to pay less interest?
 
For what it’s worth I think the market out here (Monterey peninsula) is softening, but I can’t wait because the rental I am in may make me go nuts.

If you’re seriously asking, I will call my guy and see what he can do.

[Gil Bang 26230]

Any of your loan guys have information about Freddie’s new construction loan program for accessory dwelling units?

[Incredulity 11874]

18 hours ago, TTU13 said:

Not sure where to post, so I’ll post it here.

Wife and I are young (31), built our first home and planned on being here for 5-7 years before upgrading.

Given current market, we decided we’re staying here and will make some of the upgrades we wanted to get on our next home on this house and save the extra money to buy a second home when the market drops.

We’re coming up on our 4th year here. Is it a good idea to have a home inspection every couple years to catch any issues with foundation, plumbing, etc? I imagine paying the 500-600 bucks to catch something early is worth it? We have zero settling issues (that I can see) but would rather get ahead on any issues that may come up to save headaches later on.

Why can’t you just walk around the house and give it a good looking over?

Foundation cracks are obvious, separated caulk is obvious, stick your head in the crawlspace and look for standing water….  Its not rocket surgery.

 

Edited June 9, 2022 by Incredulity

[Neonmoon 38130]

1 hour ago, Gil Bang said:

Any of your loan guys have information about Freddie’s new construction loan program for accessory dwelling units?

think you want the last paragraph? You can use a Choice Renovation to build an ADU?
 

https://guide.freddiemac.com/app/guide/bulletin/2022-11

Property eligibility

Previously, a Mortgage secured by a property with an ADU was eligible for sale to Freddie Mac only if the property was a 1-unit dwelling. In response to recent zoning and ordinance changes in many geographic areas, we have expanded our ADU eligibility requirements to allow one ADU on 2- and 3-unit properties.

Rental income generated from an ADU on a subject 1-unit Primary Residence

Previously, rental income generated from an ADU on a 1-unit Primary Residence could be considered for Mortgage qualification only when the Borrower had a disability and the rental income was from a live-in aide, or when the Mortgage was a Home Possible^®Mortgage.

We have updated our requirements to allow rental income generated from an ADU on a subject 1-unit Primary Residence to be considered when qualifying the Borrower for a purchase or a "no cash-out" refinance Mortgage, provided that certain requirements are met, including but not limited to:

• The ADU must comply with zoning and land use requirements (legal, legal non-conforming or no zoning)
• An appraisal report must be obtained to support the ADU's marketability and include at least one comparable sale with an ADU that is rented. If an automated collateral evaluation (ACE) appraisal waiver is offered, it must not be accepted.
• The appraiser's rental analysis must include a minimum of three comparable rentals that support the market rent of the ADU, and at least one of the comparable rentals must be a property with an ADU
• The Seller must ensure that the ADU rental income used to qualify the Borrower for the Mortgage does not exceed 30% of the total stable monthly income
• At least one qualifying Borrower must participate in a landlord education program or have previous landlord experience for a minimum of one year

As a result of these expanded requirements, we have reorganized the content of Guide Chapter 5306. No changes to our other rental income requirements have been made. In addition, Guide Form 92, Net Rental Income Calculations, has been updated to incorporate the calculation and eligibility requirements for the use of rental income from an ADU on a subject 1-unit Primary Residence.

Use of "no cash-out" refinance Mortgage to help finance ADU construction or renovation

We are specifying that our existing CHOICERenovation Mortgage offering provides an option to use a "no cash-out" refinance Mortgage to pay off short-term financing that financed ADU renovations, including the addition or renovation of an ADU, that is completed prior to the Note Date.

[TTU13 108]

If you have a reason to be worried call the applicable repair company for a quote and they’ll inspect what you’re worried about.
if you have no settling cracks, no water issues, electrical all acts correctly then I would just count your blessings and pocket the money.  The only thing I get inspected regularly is my HVAC (though I will have a plumber descale and inspect my tankless water heater every two years going forward).
Inspectors always try to find something, sure they could uncover something major but 9 times out of 10 with a new build that “major” issue won’t turn into a big deal for at least another decade.
Standard inspection report bullshit includes poor grading, poor/insufficient  flashing, settling cracks (that they recommend getting a foundation inspector to look at), roof concerns (same as what I just typed), caulking around windows, tile/grout/caulking around kitchen/bath, leaky sinks/toilet, filters need to be replaced, dryer hose full of lint, HVAC not balanced, loose railing, doors/windows binding, vegetation touching the home…

Why can’t you just walk around the house and give it a good looking over?
Foundation cracks are obvious, separated caulk is obvious, stick your head in the crawlspace and look for standing water….  Its not rocket surgery.
 

I have a tankless, curious to learn more about the every 2 year deal.


As far as myself, I do all that fairly regularly. Just wasn’t sure if there was something I may be missing for a couple hundred bucks. Only real “issue” was the post tension rods on the foundation had a slight exposure so I put some cement over those to prevent any water exposure.

[Upgrayedd 5878]

1 hour ago, TTU13 said:

 

 

 

I have a tankless, curious to learn more about the every 2 year deal.


As far as myself, I do all that fairly regularly. Just wasn’t sure if there was something I may be missing for a couple hundred bucks. Only real “issue” was the post tension rods on the foundation had a slight exposure so I put some cement over those to prevent any water exposure.

 

 

 

Doubt you are covering PT tendons as those are typically in a duct and grouted after tensioning.  

[TKthunder2 5059]

1 hour ago, TTU13 said:

I have a tankless, curious to learn more about the every 2 year deal.

 

 

 

https://www.plumbingsupply.com/tankless-water-heater-maintenance-guide.html
 

Some of the basic shit on here you can easily do yourself every few months.

Descaling and cleaning the burner are a little more advanced and that’s what our plumber recommended we do every two years.

[Neonmoon 38130]

CPI report released. expected 8.3%, got 8.6%. 

Rates are going up 

[Mother mopar 3383]

CPI report released. expected 8.3%, got 8.6%. 
Rates are going up 

Hold on to your pants.

[Wulaw Horn 19579]

48 minutes ago, Neonmoon said:

CPI report released. expected 8.3%, got 8.6%. 

Rates are going up 

It’s just staggering how every single metric seems to be worse than expected every time, and that’s with expectations in the shitter. 
mbs market down 47 points as we speak (down is bad) meaning 1/8 of a point worse. 
I think it’s been down significantly every day this week as I’ve been gone. Nothing good happening out there man. Nothing good. 

[Neonmoon 38130]

Jesus H Christ. Rates just came out. Get in the 5s while you can folks!

[Wulaw Horn 19579]

4 minutes ago, Neonmoon said:

Jesus H Christ. Rates just came out. Get in the 5s while you can folks!

I mean we are only down like 80 bips now for the day. No problem at all!  

[Muny_Tex 315]

So how much longer until the new “bidding wars” are for the purchase rights to assumable VA loans? I’m only half joking…

[jimmyjazz 47127]

I pay reasonably close attention to west and NW Austin real estate.  I am DEFINITELY seeing more price drops.  That doesn't necessarily mean prices aren't still climbing, they appear to still be on an upward slope, but there is absolutely a cooling off going on, at least in terms of sellers trying to swing for the fences.

[smoothlonghorn 85]

Looks like I picked the wrong time to quit sniffing glue...and get back into mortgages (or at least at the same time).

I haven't had much to add that the professionals don't already cover, but yes, rates suck and if you can lock, should (will give extended-lock perspectives where applicable). ~Signed, your lowly Builder Loan Officer that everyone hates and is trying to get Borrowers not to use

[Wulaw Horn 19579]

37 minutes ago, smoothlonghorn said:

Looks like I picked the wrong time to quit sniffing glue...and get back into mortgages (or at least at the same time).

I haven't had much to add that the professionals don't already cover, but yes, rates suck and if you can lock, should (will give extended-lock perspectives where applicable). ~Signed, your lowly Builder Loan Officer that everyone hates and is trying to get Borrowers not to use

That’s just because we are jealous of you guys that have the seller on lock down and an endless stream of buyers camped out every day. 
hope your market is still good bro- doesn’t seem like a bad time to work for a builder unless they are squeezing y’all bc they can. 

[Neonmoon 38130]

 

Hope the early poster locked that 4.75 jumbo yesterday 😀

 

[Wulaw Horn 19579]

I locked someone at 4.25 on an arm yesterday. I suspect I couldn’t do that again. 

[Hefeweizen 5443]

Well today was quite the adventure.  Woke up and had coffee and was putting around then saw the inflation print but of course I am in Cali so no one is working yet.  I call the mortgage guy at 8 am freaking out and he tells me I’m fine, should be able to get 7 percent no problem.  Hilarious.

 We locked right then at 5 with no points, buying six grand in points would save 60 bucks per month.  
 

30 day lock and we’re needing to escrow in 27 if possible.  Our realtor submits our offer at 1130 am and I finish up work, then go kayaking with the kids for a couple of hours.  I get back to shore and not only is the offer accepted but we’re already scheduled for appraisal and title is moving.

It was a good day.  I can’t believe we’re pulling off this move but fingers crossed it’s in the final leg.

[We’reTexas 1477]

32 minutes ago, Hefeweizen said:

Well today was quite the adventure.  Woke up and had coffee and was putting around then saw the inflation print but of course I am in Cali so no one is working yet.  I call the mortgage guy at 8 am freaking out and he tells me I’m fine, should be able to get 7 percent no problem.  Hilarious.

 We locked right then at 5 with no points, buying six grand in points would save 60 bucks per month.  
 

30 day lock and we’re needing to escrow in 27 if possible.  Our realtor submits our offer at 1130 am and I finish up work, then go kayaking with the kids for a couple of hours.  I get back to shore and not only is the offer accepted but we’re already scheduled for appraisal and title is moving.

It was a good day.  I can’t believe we’re pulling off this move but fingers crossed it’s in the final leg.

Congrats, Monterrey or Carmel? Would love to live in the peninsula but always assumed the market was ridiculous.

[Hefeweizen 5443]

1 hour ago, We’reTexas said:

Congrats, Monterrey or Carmel? Would love to live in the peninsula but always assumed the market was ridiculous.

Pacific Grove.  Pricing is tough but we downsized from Westlake Hills.  We paid way less than we sold for which was a huge bonus.

[closetohumping 17803]

12 hours ago, jimmyjazz said:

I pay reasonably close attention to west and NW Austin real estate.  I am DEFINITELY seeing more price drops.  That doesn't necessarily mean prices aren't still climbing, they appear to still be on an upward slope, but there is absolutely a cooling off going on, at least in terms of sellers trying to swing for the fences.

I saw a couple of things go under ask out here in irvine

[closetohumping 17803]

3 hours ago, We’reTexas said:

Congrats, Monterrey or Carmel? Would love to live in the peninsula but always assumed the market was ridiculous.

That area is heaven.  Especially if  you like scenic and quiet

Edited June 11, 2022 by closetohumping

[Gil Bang 26230]

10 hours ago, closetohumping said:

I saw a couple of things go under ask out here in irvine

One thing about Irvine in particular...the Chinese all-cash buyers have dried up almost completely.  One of the agents in my office is a very busy Chinese guy, and, according to him, due to some change in Chinese law, it's very difficult to move money from China to the U.S. now.  

My buddy lives in Chino Hills, and his neighborhood has turned almost all Chinese.  It was not uncommon a few years back for him to receive letters or phone calls offering big money for his house.  He hasn't gotten those in a while. 

[Dbeasy 15561]

FYI NAR posted 2021 home sales in every market broken out by institutional vs non-institutional. Institutional was 41% in Travis County. 

[Axle Hongsnort 210]

I pay reasonably close attention to west and NW Austin real estate.  I am DEFINITELY seeing more price drops.  That doesn't necessarily mean prices aren't still climbing, they appear to still be on an upward slope, but there is absolutely a cooling off going on, at least in terms of sellers trying to swing for the fences.

I dunno man, 78746 prices still a rocket ship for my three Cali friends transferring here

[Neonmoon 38130]

One of my clients just made an offer for under ask. There is some anecdotal cooling 

Edited June 13, 2022 by Neonmoon

[Wulaw Horn 19579]

Down 68 bips end of day Friday, down 66 bips at market open today. Fun times. 
 

[Neonmoon 38130]

Yeah 5s going bye bye 

[Wulaw Horn 19579]

Interest rate and gas both in the 6’s here shortly this summer. What a wonderful year so far! 

[Muny_Tex 315]

So with the refi market effectively dead as of mid-March, is second home financing now toast as well?

I assume those rates are heading into the 7’s soon…presumably with points still required as well?

[UTPhil2006 3930]

1 minute ago, Muny_Tex said:

So with the refi market effectively dead as of mid-March, is second home financing now toast as well?

I assume those rates are heading into the 7’s soon…presumably with points still required as well?

Theyre running about half a point interest rate higher at most lenders so yeah they will get to 7 first.  The last 2 days have been absolutely brutal.

[Wulaw Horn 19579]

8 minutes ago, Muny_Tex said:

So with the refi market effectively dead as of mid-March, is second home financing now toast as well?

I assume those rates are heading into the 7’s soon…presumably with points still required as well?

I mean- not if you don’t mind putting down 40% on that second. Then you can get the same shitty rate you’d get on your primary residence. 

[Neonmoon 38130]

39 minutes ago, Muny_Tex said:

So with the refi market effectively dead as of mid-March, is second home financing now toast as well?

I assume those rates are heading into the 7’s soon…presumably with points still required as well?

I live in a tourist town. Second Home/Investment financing is dead. 

You have to put 30% down and the rate is fucked. 

[Wulaw Horn 19579]

11 minutes ago, Neonmoon said:

I live in a tourist town. Second Home/Investment financing is dead. 

You have to put 30% down and the rate is fucked. 

Where do you live?

it’s so damn depressing out there right now. I’ve had a couple people drag their feet and now they are out of the market. 
I had about 50 people I wanted to Refiance at the beginning of the year- we got about 5 of those done. People at 3.75% and paying PMI, stuff like that. 

[smoothlonghorn 85]

2nd (worse) re-price of the day already....

 

[Wulaw Horn 19579]

1 minute ago, smoothlonghorn said:

2nd (worse) re-price of the day already....

 

The beatings will continue until morale improves. 
hope for 75 bip increase by fed on Wednesday with jaw boning that they will do whatever they can to crack inflation.  That’s the only way out. 

[Muny_Tex 315]

Where do you live?
it’s so damn depressing out there right now. I’ve had a couple people drag their feet and now they are out of the market. 
I had about 50 people I wanted to Refiance at the beginning of the year- we got about 5 of those done. People at 3.75% and paying PMI, stuff like that. 

So apparently the Fed’s solution to runaway rent increases is to slam the door on entry-level home ownership altogether (therefore creating even more supply/demand friction for affordable leases)…seems rational.

I’m all in favor of locking out speculators from hoarding second homes/investment units via cheap lending (that was long overdue IMO); but the rest of this shit is not remotely productive.

[Wulaw Horn 19579]

3 minutes ago, Muny_Tex said:

So apparently the Fed’s solution to runaway rent increases is to slam the door on entry-level home ownership altogether (therefore creating even more supply/demand friction for affordable leases)…seems rational.

I’m all in favor of locking out speculators from hoarding second homes/investment units via cheap lending (that was long overdue IMO); but the rest of this shit is not remotely productive.

The second home Hike doesn’t even really do that imo. People buying a 500k second home I’m a resort community (or million or whatever) aren’t keeping median type first timers from buying I don’t think. Investment property is the median and below type housing and that’s always carried a large pricing premium. 
I have no problem conceptually with the idea of not helping more affluent buyers with indirect subsidies as a policy choice, but I doubt Neon’s customers not getting interest rates at the old

level open up opportunities for Freddy first

timer. And I have a lot of compassion/sadness for any first timer in this market. High prices, high rates and serious bidding. Brutal. 

[UTPhil2006 3930]

1 hour ago, Muny_Tex said:

So apparently the Fed’s solution to runaway rent increases is to slam the door on entry-level home ownership altogether (therefore creating even more supply/demand friction for affordable leases)…seems rational.

I’m all in favor of locking out speculators from hoarding second homes/investment units via cheap lending (that was long overdue IMO); but the rest of this shit is not remotely productive.

I think that's more of an ancillary effect, rather than their initial intention.

[LCHorn 2750]

2 hours ago, Muny_Tex said:

So with the refi market effectively dead as of mid-March, is second home financing now toast as well?

I assume those rates are heading into the 7’s soon…presumably with points still required as well?

I’ll share this so the other mortgage folks see it-just closed a second home purchase last week ($300k purchase, 20% down) and had to do a pricing cure due to Mavent fail such that our gross was about 120 bps (our average conventional, by contrast, is about 290).  Once we pay our branch stuff it’ll be a loss.  
 

I’ve told our staff that we need to classify all second home purchases as investment properties going forward so the HMPL test isn’t applied.  
 

Coincidentally, I locked this one right before a rate jump and it failed the test because the index it uses to compare pricing was 6 days behind my date of lock (so an example where the CFPB’s imposed compliance obligations aren’t flexible enough to accommodate rate deterioration of this magnitude).  This, of course, is to the long-term detriment of the borrower if we have to require additional down payment or a program change to make a profit (or otherwise we just don’t make them at all).  

[Neonmoon 38130]

2 hours ago, Wulaw Horn said:

Where do you live?

it’s so damn depressing out there right now. I’ve had a couple people drag their feet and now they are out of the market. 
I had about 50 people I wanted to Refiance at the beginning of the year- we got about 5 of those done. People at 3.75% and paying PMI, stuff like that. 

I live where I live. (NC mountains)

I just had a client get priced out of a house they put an offer on yesterday. Looks like they priced in the Fed 75 bp hike today, because the rate I had to quote was stupid high. Their credit wasn't stellar, but still. 

Also, I got fucked on a cure last week. THANKS TRID YOU CUNTS