All Encompassing Mortgage and Real Estate Thread

[Neonmoon 38126]

13 minutes ago, Wulaw Horn said:

It’s a lot of Closing costs to do that. You then pay nothing (and maybe get some cash). If you don’t mind spending your kids inheritance (I don’t think most people should care if they do) it’s a wonderful product, provided you die/go to the home in that house. 

Yes, it has high closing costs. I'm okay with that for no housing payment and using the equity as an investment tool 

As to the kids, fuck them. 

[Wulaw Horn 18919]

41 minutes ago, Neonmoon said:

Yes, it has high closing costs. I'm okay with that for no housing payment and using the equity as an investment tool 

As to the kids, fuck them. 

Generally agree. 
I think it’s shitty if you get a decent sized inheritance and don’t leave anything for the next generation, but if you are talking about what you earned you are morally entitled to spend it however you want with no concern for the next generation imo. 

[Catpfish 618]

To me, the biggest wild card in housing market is what the rising interest rates do to the investment purchases.  It was stated above that over 40% of the homes sold in Travis County last year were institutional purchases.  If their financing costs/required returns start to rise (throw in the uncertainty of taxes), there might be a drop in that part of the equation which could lead to a fairly significant drop in demand, at least at the cash top end of offers.  Of course, that could also open the market back up to first time home buyers which would not be a bad thing at all.  

[Skipper 5969]

3 hours ago, Catpfish said:

To me, the biggest wild card in housing market is what the rising interest rates do to the investment purchases.  It was stated above that over 40% of the homes sold in Travis County last year were institutional purchases.  If their financing costs/required returns start to rise (throw in the uncertainty of taxes), there might be a drop in that part of the equation which could lead to a fairly significant drop in demand, at least at the cash top end of offers.  Of course, that could also open the market back up to first time home buyers which would not be a bad thing at all.  

Definitely a bunch of indirect leverage on those institutional purchases.  Finance lawyer here and I don't do much of that work but have partners that do.  Not only large pools of rental properties that are financed but also fix and flip deals.   I was just having a conversation that it will be interesting to see what happens with the fix/flip if this buying slow down is real and prolonged (as I anticipate it will be).

Edited June 14, 2022 by Skipper

[Pato del Muerto 52118]

Does institutional also refer to front door and Zillow buying to flip?

[Gil Bang 25689]

Does institutional also refer to front door and Zillow buying to flip?

Yes but Zillow lost their asses and bailed at a big loss

[Neonmoon 38126]

Also heard Academy dropped all LOs to 75 bips. Fun times 

[Wulaw Horn 18919]

9 minutes ago, Neonmoon said:

Also heard Academy dropped all LOs to 75 bips. Fun times 

I wonder if they are dropping the house cut too? 

[Neonmoon 38126]

7 hours ago, Wulaw Horn said:

I wonder if they are dropping the house cut too? 

Didn’t ask. I’m sure everything is on the table though in this market. It’s all about selling loans, so everyone has to readjust to make that happen. 

[UTPhil2006 3773]

9 hours ago, Neonmoon said:

Also heard Academy dropped all LOs to 75 bips. Fun times 

Damn so my shoes and Astros jerseys are gonna cost more now?

Also, 10 year opened up down 0.10 so far so only 50 more to get back to where we were Thursday

[closetohumping 17302]

I kinda like this listing, you get some land and you're still closish to Austin.  Wife would say no to this of course:

 

https://www.realtor.com/realestateandhomes-detail/500-Blue-Ridge-Dr_Dripping-Springs_TX_78620_M79689-75255?ex=2944175570

[Neonmoon 38126]

Fed announced 0.75 Fed Fund rate hike. 

(Fed fund rate is not mortgage rates, but rate banks lend to each other. Mortgages rates already priced it in on Monday/Tuesday)

[Captainant 26927]

On 6/13/2022 at 11:50 PM, Assman said:

I'm not a financial nor real estate expert, but I just don't see this as a "bubble".  This seems nothing like 2008 to me.  The bubble burst in 2008 was caused by shitty sub-prime loans going to people who could not afford them.  Once inflation and unemployment set in, people simply couldn't afford to pay their mortgage.  Today, those sub-prime loans are a thing of the past.  I don't have any stats in front of me and this is just a complete shot in the dark, but I'd wager that close to 50% of current home owners are sitting below 4% due to a recent purchase or refi.  If rates keep going up, sure real estate prices will come down, but those buyers will be staring a 6/7/8% rate square in the face so it'll all come out in the wash.  The only ones who benefit are the cash buyers.  Either way, I just don't see this as any sort of "bubble" that's going to burst.  It's going to be a steady kick in the nuts that gets less intense as time goes on.

Aren't corporate buyers the single largest bloc on the market right now? Something like 40% of home purchases have been by businesses, not individuals. 

Seems like those large cash buyers are going to benefit even more from the market conditions, unless rules change to prevent corporations from boxing people out of the housing market

[StruggleBus 3922]

4 hours ago, closetohumping said:

I kinda like this listing, you get some land and you're still closish to Austin.  Wife would say no to this of course:

 

https://www.realtor.com/realestateandhomes-detail/500-Blue-Ridge-Dr_Dripping-Springs_TX_78620_M79689-75255?ex=2944175570

My wife: Yeah, it has potential, but we'd need to put at least $250k of renovations into it (at least) before moving in. 

[Wulaw Horn 18919]

UP 105 basis points today in the MBS Market (UP is good) as the fed announces 75 basis point hike. Would I have liked 100?  Yes, that's on the table allegedly in July.  We thought we were getting 25 or 50, the 75 came about 2 days ago- nobody saw that coming Friday morning when we woke up.

As I say often on here- fed raising interest rate is good for interest rate on your home (bad for credit card- car or HELOC) b/c fed raising interest rate causes flight to quality and MBS are generally considered quality (along with the 10 year treasury- which is why some people watch that as it's correlated with MBS pricing which drives interest rates), it's just in this time of massive inflation NOTHING is considered quality, thus why you see MBS market and 10 year getting crushed, at the same time the stock market is getting crushed, at the same time everything seems like it sucks.

Market now believes (maybe for the first time all year) that the FED is serious about inflation. If this keeps up then what happened 2 or 3 days ago will be a top, and inflation will eventually start to subside, and with it interest rates will go down.  That's from a real estate point of view.  The bad news is it makes recession more likely, but the time to engineer a soft landing is probably long since past, and the sooner the fed gets to giving us our medicine (which it looks like they are finally willing to do now) the sooner we can start getting better.  

That's my take, before the press conference is fully digested and reported.  Will update tomorrow after see the comments and analysis.

[Wulaw Horn 18919]

The charts I used to post- before I got too suicidal about it.  Remember what they are- this is what the average consumer paid yesterday on each individual case.  Your mileage may vary.  I locked someone in on a 30 at 5.375% the other day and someone on an arm, today, at 4.375%.  This doesn't mean what you will pay- but it is where the market was at yesterday.  I'm putting a bold on this- as I hope this will be the worst the chart ever is- as today could be a turning point/line in the sand where the market finally believed the fed caught up to being serious about the scourge of inflation.  

 

DAILY MORTGAGE RATES  (June 14, 2022) — Powered by OBMMI™

30-YR. CONFORMING

6.056% +0.113

30-YR. JUMBO

5.412% +0.115

30-YR. FHA

5.676% +0.059

30-YR. VA

5.555% +0.097

30-YR. USDA

5.611% +0.107

15-YR. CONFORMING

5.041% +0.120

[Neonmoon 38126]

5 minutes ago, Wulaw Horn said:

Market now believes (maybe for the first time all year) that the FED is serious about inflation. If this keeps up then what happened 2 or 3 days ago will be a top, and inflation will eventually start to subside, and with it interest rates will go down.  That's from a real estate point of view.  The bad news is it makes recession more likely, but the time to engineer a soft landing is probably long since past, and the sooner the fed gets to giving us our medicine (which it looks like they are finally willing to do now) the sooner we can start getting better.  

I do believe they are trying to get serious now. I do not believe this is the top. A recession has already started IMO, it just won't be announced until two declined GDP reports. The landing will not be soft. We are getting the medicine now. This is the first spoonful. The finger in the ass is next. 

[StruggleBus 3922]

7 minutes ago, Neonmoon said:

The finger in the ass is next. 

[Wulaw Horn 18919]

7 minutes ago, Neonmoon said:

I do believe they are trying to get serious now. I do not believe this is the top. A recession has already started IMO, it just won't be announced until two declined GDP reports. The landing will not be soft. We are getting the medicine now. This is the first spoonful. The finger in the ass is next. 

First sentence- Agree

Second sentence- we shall see- the argument for my point of view is that we are really oversold and really pessimistic as a market and the pyschology sucks.  This ran too far and too fast.  Changing opinions in the market will change the reality- I think that might have started.

Third sentence- we were negative 1.5% 1st quarter.  Is it possible this second quarter we are finishing up right now is negative- to meet the definition of recession with 2 negative quarters?  Sure.  I think job situation is still good enough and rate spikes still new enough that we squeek out an anemic 0.8 or 1.2 growth making it not a recession right now- I think that comes later call it 4th quarter 2022 and 1st quarter 2023.

4th sentence- Agree- which is I think what they have finally realized- when inflation came in awful again last week.  

5th- agree

6-th Sure

7th- some guys pay extra for that.  NTTAWWT.  

 

[closetohumping 17302]

1 hour ago, StruggleBus said:

My wife: Yeah, it has potential, but we'd need to put at least $250k of renovations into it (at least) before moving in. 

Correct.  My wife would say no because it lacks curb appeal.  But it's a yes from me dawg

[Fudge Nuggets 19001]

On 6/14/2022 at 11:53 AM, Wulaw Horn said:

Generally agree. 
I think it’s shitty if you get a decent sized inheritance and don’t leave anything for the next generation, but if you are talking about what you earned you are morally entitled to spend it however you want with no concern for the next generation imo. 

Bingo. 
Anything my parents leave behind is going straight to the grandkids. I’m planning on the last payment I make bouncing. 

[Wulaw Horn 18919]

1 minute ago, Fudge Nuggets said:

Bingo. 
Anything my parents leave behind is going straight to the grandkids. I’m planning on the last payment I make bouncing. 

My goal in life is to leave a family foundation that my kids will use for real charitable work and add their own money to it to as they go along to create a legacy. I've got 25 more years (hopefully) working to make that happen.  Goal is 8 figures with 10% return on the corpus so that I can give away 7 figures every year.  2021 was the first year in a long time where it felt like I was on the path to making that happen.  2022 has been interesting in that path, to say the least. Doesn't feel like a linear march right now.  All that said- that's my goal and hope for myself- I think what you said is absolutely positively appropriate if that's how you feel and I don't think it would be good to give that money to my kids. I'm teaching them (hopefully) to earn their own and marry well with other people that will help them on that path. IF they do that they don't need my money. If they don't do that no amount of money I leave them can fix their life.  So, I want them to do good in their community as my legacy.  

If I can't get there then I plan on bouncing my last check.  I will get nothing from either side so that will be appropriate for them as far as I'm concerned. 

[Wulaw Horn 18919]

MBS market started out down 86 points today but it's clawed back to only down 33.  Markets got shook when Swiss and some other Central Banks announced price hikes that were off schedule and unexpected.  Fears are since calming I guess. 

Jobless report came in where the last one came in.

Housing starts are at an annualized pace of 1.73 million.  That's down.  Experts think we need 1.9 or so to keep up with family formations- so this is not an expansion of supply.  We are still short houses.  As long as we remain short houses we likely won't see any depreciation in housing.  

[CHIEF 5046]

19 hours ago, Wulaw Horn said:

My goal in life is to leave a family foundation that my kids will use for real charitable work and add their own money to it to as they go along to create a legacy. I've got 25 more years (hopefully) working to make that happen.  Goal is 8 figures with 10% return on the corpus so that I can give away 7 figures every year.  2021 was the first year in a long time where it felt like I was on the path to making that happen.  2022 has been interesting in that path, to say the least. Doesn't feel like a linear march right now.  All that said- that's my goal and hope for myself- I think what you said is absolutely positively appropriate if that's how you feel and I don't think it would be good to give that money to my kids. I'm teaching them (hopefully) to earn their own and marry well with other people that will help them on that path. IF they do that they don't need my money. If they don't do that no amount of money I leave them can fix their life.  So, I want them to do good in their community as my legacy.  

If I can't get there then I plan on bouncing my last check.  I will get nothing from either side so that will be appropriate for them as far as I'm concerned. 

Amen. Get them started in philanthropy early on. CHIEF Jr.'s cause is Cast for Kids. Our Tri-toon has a gate large enough to get a wheelchair through, he loads up the 5-6 kids that are in a wheelchair, and takes them fishing once or twice per year. One of our best friends has a son with severe autism, his son and mine have been friends since they started tailgating with us when the boys were about 12. We are on a hunting lease together, CHIEF Jr. watches over him like a hawk, takes care of him, interacts with him. It kinda gives his Dad a break. My mother has a 401c that all of the proceeds go to printing Bibles in African languages that are spoken by too few for the Gideons to print. We both put work in for that. We all contribute to James Robison's ministry that drills water wells in Africa. It is important to let your kid know they have it better than most, and not to be a selfish asshole, and contribute to make society better.

CHIEF

[Wulaw Horn 18919]

At one point in time the MBS was down 99 points.  Finished the day down 3.  It was as inspiring as any Rocky movie.  Was humming the theme song as 4:01 ticked over. 

[closetohumping 17302]

Speaking of philanthropy, this guy did a lot of things behind the scenes and undercover:

 

[Neonmoon 38126]

Does anyone else have a problem underwriter? Like every other one does their job and things go smoothly. But we have one that is nitpicky as fuck, and pretty much just adds days to every goddamn loan. (and years off my life)

[UTPhil2006 3773]

2 hours ago, Neonmoon said:

Does anyone else have a problem underwriter? Like every other one does their job and things go smoothly. But we have one that is nitpicky as fuck, and pretty much just adds days to every goddamn loan. (and years off my life)

Depends on the lender.  At UWM they actually listen and work to fix shit.  At CMG, Caliber, etc they fight you on dumb common sense shit.  Non QM lenders are worse but at least its to be expected with them.

[chainsaw 9668]

34 minutes ago, UTPhil2006 said:

Depends on the lender.  At UWM they actually listen and work to fix shit.  At CMG, Caliber, etc they fight you on dumb common sense shit.  Non QM lenders are worse but at least its to be expected with them.

what do all these acronyms mean

[UTPhil2006 3773]

17 minutes ago, chainsaw said:

what do all these acronyms mean

Lender names. United Warehouse Mortgage, etc. Non QM means non qualified mortgage. They are your out of the box loans like bank statement loans, DSCR loans, etc. and come with a much higher rate. 

[mchookem 15575]

hey guys...this seems like a good place to say for the first time i'm no longer a Texas homeowner. 😮

man, i follow this thread closely, i've felt for the tough times y'all are all having. it's also kept me current and educated as we've gone thru our journey - as someone said in a completely unrelated thread, surly has some real smart folks and actual experts in a multitude of fields.

so maybe a little bit of 'holy shit i've been planning this for 17 years dreams really do come true!' from a fellow Longhorn will make you smile a little. maybe some of you more than others 😉😀 i hope it does 🤘

 

i'll share more later, i'm a little emotional and still in a bit of shock lol 😊

[Neonmoon 38126]

A realtor just asked me, the lender, to reach out to the sellers agent and ask for a sellers concession addendum

(I don't think the clients are getting their money's worth)

 

[Wulaw Horn 18919]

So, I just saved some deal for a realtor with a non QM program. His lender gave him an approval, he got under contract and then they denied him. Then, he went to another lender that she had recommended and she turned him down (her normal lender). Finally, she asked one of her friends who was good and had a bunch of products, got

recommended to me and I’m getting it done with a 12 month Business bank statement program. 
 

Am I his best friend for doing a loan that multiple people have denied?  No, he’s bitching about cost and time. We are going to close in 30 days (he was conditionally approved Wednesday night after I got the loan application at 6:48 on Monday night, and his lock is 6.375 on Thursday morning- paying 1.25% in discount points. He’s bitching and morning, pissed and “threatening to find another loan officer because of these outrageous costs and fees”. For context the national average on A paper premium deal right. Is is 6.12 I believe. And the typical spread on a non QM deal is at least a point and a half. 

What do you think- should I fire him as a client?  

Edited June 21, 2022 by Wulaw Horn

[royiv 9045]

4 minutes ago, Wulaw Horn said:

So, I just saved some deal for a realtor with a non QM program. His lender gave him an approval, he got under contract and then they denied him. Then, he went to another lender that she had recommended and she turned him down (her normal lender). Finally, she asked one of her friends who was good and had a bunch of products, got

recommended to me and I’m getting it done with a 12 month Business bank statement program. 
 

Am I his best friend for doing a loan that multiple people have denied?  No, he’s bitching about cost and time. We are going to close in 30 days (he was conditionally approved Wednesday night after I got the loan application at 6:48 on Monday night, and his lock is 6.375 on Thursday morning- paying 1.25% in discount points. He’s bitching and morning, pissed and “threatening to find another loan officer because of these outrageous costs and fees”. For context the national average on A paper premium deal right. Is is 6.12 I believe. And the typical spread on a non QM deal is at least a point and a half. 

What do you think- should I fire him as a client?  

Is future referral business from the realtor a consideration?

[Pato del Muerto 52118]

13 minutes ago, Wulaw Horn said:

So, I just saved some deal for a realtor with a non QM program. His lender gave him an approval, he got under contract and then they denied him. Then, he went to another lender that she had recommended and she turned him down (her normal lender). Finally, she asked one of her friends who was good and had a bunch of products, got

recommended to me and I’m getting it done with a 12 month Business bank statement program. 
 

Am I his best friend for doing a loan that multiple people have denied?  No, he’s bitching about cost and time. We are going to close in 30 days (he was conditionally approved Wednesday night after I got the loan application at 6:48 on Monday night, and his lock is 6.375 on Thursday morning- paying 1.25% in discount points. He’s bitching and morning, pissed and “threatening to find another loan officer because of these outrageous costs and fees”. For context the national average on A paper premium deal right. Is is 6.12 I believe. And the typical spread on a non QM deal is at least a point and a half. 

What do you think- should I fire him as a client?  

If you can afford to then yes.   Will just be 30 days of bitching at best, and the client sounds like the type to fire you over $500 in fees or 1/8 point. 

[UTPhil2006 3773]

29 minutes ago, Wulaw Horn said:

So, I just saved some deal for a realtor with a non QM program. His lender gave him an approval, he got under contract and then they denied him. Then, he went to another lender that she had recommended and she turned him down (her normal lender). Finally, she asked one of her friends who was good and had a bunch of products, got

recommended to me and I’m getting it done with a 12 month Business bank statement program. 
 

Am I his best friend for doing a loan that multiple people have denied?  No, he’s bitching about cost and time. We are going to close in 30 days (he was conditionally approved Wednesday night after I got the loan application at 6:48 on Monday night, and his lock is 6.375 on Thursday morning- paying 1.25% in discount points. He’s bitching and morning, pissed and “threatening to find another loan officer because of these outrageous costs and fees”. For context the national average on A paper premium deal right. Is is 6.12 I believe. And the typical spread on a non QM deal is at least a point and a half. 

What do you think- should I fire him as a client?  

I'd keep him on.  Non QM deals are a bitch and most don't like it/understand it but he's going to run into it everywhere.  Just explain that once he gets his ducks in a row you can refinance him in 8-12 months hopefully.

[Wulaw Horn 18919]

44 minutes ago, royiv said:

Is future referral business from the realtor a consideration?

Yes. That’s certainly the hope at least and why I’m doing it. At a minimum I need her to understand what’s going on. 

34 minutes ago, Pato del Muerto said:

If you can afford to then yes.   Will just be 30 days of bitching at best, and the client sounds like the type to fire you over $500 in fees or 1/8 point. 

Yeah- the funny thing is I’m pretty sure he can search far and wide and not find that 1/8 or $500. 

19 minutes ago, UTPhil2006 said:

I'd keep him on.  Non QM deals are a bitch and most don't like it/understand it but he's going to run into it everywhere.  Just explain that once he gets his ducks in a row you can refinance him in 8-12 months hopefully.

We did talk about that- I even told him I’d do him for the national average by Loansifter on that day and pay all his closing costs. That didn’t mollify him nor did he respond positively toward me recapping his timeline and cost conversation, so I’m not sure he will ever be happy. 
 

for now I soldier on. I suspect I’m going to regret this. 

[Neonmoon 38126]

1 hour ago, Wulaw Horn said:

 I suspect I’m going to regret this. 

[LCHorn 2564]

3 hours ago, Wulaw Horn said:

So, I just saved some deal for a realtor with a non QM program. His lender gave him an approval, he got under contract and then they denied him. Then, he went to another lender that she had recommended and she turned him down (her normal lender). Finally, she asked one of her friends who was good and had a bunch of products, got

recommended to me and I’m getting it done with a 12 month Business bank statement program. 
 

Am I his best friend for doing a loan that multiple people have denied?  No, he’s bitching about cost and time. We are going to close in 30 days (he was conditionally approved Wednesday night after I got the loan application at 6:48 on Monday night, and his lock is 6.375 on Thursday morning- paying 1.25% in discount points. He’s bitching and morning, pissed and “threatening to find another loan officer because of these outrageous costs and fees”. For context the national average on A paper premium deal right. Is is 6.12 I believe. And the typical spread on a non QM deal is at least a point and a half. 

What do you think- should I fire him as a client?  

They are just negotiating after the fact.  Don’t get mad about it, just agree with them it’s expensive and unfortunately it’s what the investor charges.  If they’d like to terminate the application and go elsewhere you’ll wish them the best of luck. 

[Wulaw Horn 18919]

1 hour ago, LCHorn said:

They are just negotiating after the fact.  Don’t get mad about it, just agree with them it’s expensive and unfortunately it’s what the investor charges.  If they’d like to terminate the application and go elsewhere you’ll wish them the best of luck. 

This has a lot of sense to it imo.  I stopped just short of saying the last part but that was the context. What I wanted to say is perhaps we should terminate right now and shake hands and move on, which is slightly shittier and slightly worse than how you phrased it. 

[UTPhil2006 3773]

Have to brag on ResMac real fast on a non QM DSCR loan. Basically we went 45 days through the process had the appraisal (and a second follow up one) on an investment property in Smithville. The initial UW said pass so we sent it to like 9 different DSCR reps just to see. All 9 said no. ResMac actually had a senior guy come in and use a common sense approach (extremely low LTV) and got the CTC. 
 

So yeah Non QM can be a bit of a pain in the ass but when you get to tell your client hey we got the CTC what time you wanna sign tomorrow - totally worth every bit of it 

[Wulaw Horn 18919]

7 minutes ago, UTPhil2006 said:

Have to brag on ResMac real fast on a non QM DSCR loan. Basically we went 45 days through the process had the appraisal (and a second follow up one) on an investment property in Smithville. The initial UW said pass so we sent it to like 9 different DSCR reps just to see. All 9 said no. ResMac actually had a senior guy come in and use a common sense approach (extremely low LTV) and got the CTC. 
 

So yeah Non QM can be a bit of a pain in the ass but when you get to tell your client hey we got the CTC what time you wanna sign tomorrow - totally worth every bit of it 

That’s the way you’d expect hear that story end, right?  
i’ve always felt like if the world made sense any loan where the borrower put 40 or 50% down should be an automatic green light. Who the duck even cares for they default they have so much equity?  They aren’t going to default- because they could just sell. Hell, you could probably burn the house down without insurance in many places and the dirt would be enough to cover the remaining mortgage. It’s really stupid that there isn’t just a magic number on a down payment to get a loan. 
 

Edited June 21, 2022 by Wulaw Horn

[UTPhil2006 3773]

4 minutes ago, Wulaw Horn said:

That’s the way you’d expect hear that story end, right?  
i’ve always felt like if the world made sense any loan where the borrower put 40 or 50% down should be an automatic green light. Who the duck even cares for they default they have so much equity?  They aren’t going to default- because they could just sell. Hell, you could probably burn the house down without insurance in many places and the dirt would be enough to cover the remaining mortgage. It’s really stupid that there isn’t just a magic number on a down payment to get a loan. 
 

They didn’t like it because it was on stilts. Near a River. I was like then how do you lend on beach or lake properties. If anything those stilts are protecting you. 

[Pato del Muerto 52118]

I’ll never forget one loan I processed. I think it ended up at Long Beach capital or Long Beach mortgage, a lender for the subest of subprime borrowers. 
 

Rural property in Godley, Tx. Manufactured housing. Had a note on the trailer from the dealer and the land was owner financed (with handwritten contract).  Still chattel. 
 

best part was borrower needed a SISA product because he was in the “import/export business.”

what a beating that was.  I bet the company only made 2k on that deal and the LO $500. 

Edited June 22, 2022 by Pato del Muerto

[Neonmoon 38126]

There is no pain like working bond loans. 

[Shaggy3.0 1694]

Here’s why this housing downturn is nothing like the last one

Published Mon, Jun 20 20228:00 AM EDT

 

Key Points

• The housing market has cooled off a bit after an incredibly hot stretch fueled by the pandemic. That doesn’t mean it’s about to be 2007 all over again.
• America’s housing market is in far better health today. That’s thanks, in part, to new lending regulations that resulted from that meltdown.
• There aren’t as many risky loans or mortgage delinquencies, although high home prices are forcing many people out of the market.

https://www.cnbc.com/2022/06/20/heres-why-this-housing-downturn-is-nothing-like-the-last-one.html

[UTPhil2006 3773]

1 hour ago, Pato del Muerto said:

I’ll never forget one loan I processed. I think it ended up at Long Beach capital or Long Beach mortgage, a lender for the subest of subprime borrowers. 
 

Rural property in Godley, Tx. Manufactured housing. Had a note on the trailer from the dealer and the land was owner financed (with handwritten contract).  Still chattel. 
 

best part was borrower needed a SISA product because he was in the “import/export business.”

what a beating that was.  I bet the company only made 2k on that deal and the LO $500. 

I bet that closed loan bought a good beer though. 

[Texas Jeff 1918]

I think we are in for the weirdest housing bubble of my life.  Rates were low, housing shot up, lots of people with unrealized gains that they thought would be tax-free income with a chance for more.  The more house you bought, the more you could make.  Now rates are up and those same people could never afford to now buy they house they just bought.  Demand will sink and prices will fall.  Maybe not a crash, but enough to wipe out some equity for a while.

People will be stuck in their current homes.  They may make enough to pay the 2.5% mortgage on their million dollar home but not enough to sell it at a 100k loss and move into a 700K home with a 6% mortgage.  Those folks are going to sit tight.

We may get into a situation where there still are not a lot of homes on the market because not many can afford to move.

Edited June 22, 2022 by Texas Jeff

[Wulaw Horn 18919]

16 minutes ago, Texas Jeff said:

I think we are in for the weirdest housing bubble of my life.  Rates were low, housing shot up, lots of people with unrealized gains that they thought would be tax-free income with a chance for more.  The more house you bought, the more you could make.  Now rates are up and those same people could never afford to now buy they house they just bought.  Demand will sink and prices will fall.  Maybe not a crash, but enough to wipe out some equity for a while.

People will be stuck in their current homes.  They may make enough to pay the 2.5% mortgage on their million dollar home but not enough to sell it at a 100k loss and move into a 700K home with a 6% mortgage.  Those folks are going to sit tight.

We may get into a situation where there still are not a lot of homes on the market because not many can afford to move.

Yep. And if supply is low that should protect prices more or less. Going to be lots less inventory. It’s hard for housing to crash with low inventory. 

[bluto 4819]

1 hour ago, Texas Jeff said:

I think we are in for the weirdest housing bubble of my life.  Rates were low, housing shot up, lots of people with unrealized gains that they thought would be tax-free income with a chance for more.  The more house you bought, the more you could make.  Now rates are up and those same people could never afford to now buy they house they just bought.  Demand will sink and prices will fall.  Maybe not a crash, but enough to wipe out some equity for a while.

People will be stuck in their current homes.  They may make enough to pay the 2.5% mortgage on their million dollar home but not enough to sell it at a 100k loss and move into a 700K home with a 6% mortgage.  Those folks are going to sit tight.

We may get into a situation where there still are not a lot of homes on the market because not many can afford to move.

Agree with this. And then the question is just who the hell can get a seat at the table without having a hand already to trade.