Will the Mortgage Market Ever Completely Return to ‘Normal’? via DS News

It has been seven years since the mortgage crisis first hit the country, and much has been written about “recovery” for housing and for the consumer lending market. Is that “recovery” finally upon us now?

According to a study released by TransUnion on Wednesday, yes, the consumer lending market will experience a full recovery from both the mortgage crisis and the subsequent Great Recession by the end of 2016.

More here @ DSNews.com

TransUnion’s 2016 Forecast Expects Consumer Credit Markets to Complete Recovery

‘Disruptors’ Are Emerging to Satisfy the Need for Efficiency in the Mortgage Industry – DSNews

“Disruption is inevitable in any industry, but is most predictable in an industry faced with a set of conditions that render the existing model too challenging, too inefficient, too costly, too unresponsive to the needs of consumers and businesses alike,” the paper said. “The best innovators recognize and capitalize on the opportunity presented by an increasingly ineffective approach and develop new capabilities to meet the needs of the marketplace. Mortgage finance has reached this stage.”

via ‘Disruptors’ Are Emerging to Satisfy the Need for Efficiency in the Mortgage Industry – DSNews.

FRB: Senior Loan Officer Opinion Survey: January 2014

The October 2014 Senior Loan Officer Opinion Survey on Bank Lending Practices addressed changes in the standards and terms on, and demand for, bank loans to businesses and households over the past three months. This summary discusses the responses from 76 domestic banks and 22 U.S. branches and agencies of foreign banks.
http://www.federalreserve.gov/boarddocs/snloansurvey/201411htm

Questions on commercial real estate lending. A modest net fraction of banks reported that they had eased standards on construction and land development loans, while standards for loans secured by nonfarm nonresidential structures and multifamily residential properties remained about unchanged. Moderate net fractions of banks indicated that they had experienced stronger demand for all three subcategories of CRE loans. On balance, foreign banks also reported having eased lending standards on CRE loans and having seen stronger demand for such loans over the past three months.

Questions on residential real estate lending. A moderate net fraction of large banks reported that they had eased standards on prime residential mortgages over the past three months. Smaller banks reported that standards for prime residential mortgages were about unchanged on net. Reported changes in demand for mortgage loans were mixed. On net, although large banks reported that demand for prime mortgages had weakened, smaller banks experienced increases. However, demand for nontraditional mortgages was weaker, on net, across both bank size groups. Few banks reported having changed their standards on home-equity lines of credit, and respondents indicated that they had experienced little change in demand for such loans on net.

No-Cost Mortgages – Mortgage Professor

A no-cost mortgage (NCM) is one on which all lender fees are waived, and (subject to the possible exceptions described below) other fees are paid by the lender. The quid pro quo is a relatively high interest rate, which makes the NCM costly for borrowers who expect to have their mortgage a long time. But if the borrower has limited cash, avoiding an upfront cash drain may be much more compelling than the higher interest cost spread over many years.

No-cost mortgages have one feature that I like a lot. Because lenders offering NCMs pay for services obtained from third-parties, such as title companies and appraisers, they have an incentive to find the service providers offering the lowest price. When borrowers pay for these services, which is most of the time, lenders generally accept high prices that make the service providers beholden to them.

The relative simplicity of a mortgage with only one price dimension is also attractive. In principle, it should make price-shopping much easier. Unfortunately, ambiguity about which costs are covered and which aren’t can nullify this benefit.

via No-Cost Mortgages – Mortgage Professor.

How to get a mortgage right now, even with bad credit | 2014-09-02 | HousingWire

In his interview with HousingWire, Mel Watt, the director of Federal Housing Finance Agency urges the opening of the mortgage credit box to less-than-optimal borrowers.

“We are getting lenders to reduce some of the credit overlays,” he said inthe exclusive interview.

Furthermore, FICO scores will ignore debts that have been paid off or settled, and a lesser weight will be assigned to medical bill collections, which account for about half of all unpaid collections on consumers’ credit reports.

Nonetheless, the average FICOs have been going down steadily since 2006 and it’s not hard to see why, what with the housing crisis, the financial meltdown and the general recession and record unemployment and underemployment.

So what can those with a FICO that is under 620 do to get a mortgage?

http://www.housingwire.com/articles/print/31227-how-to-get-a-mortgage-right-now-even-with-bad-credit

Here’s a real industry secret, Banks and Finance companies owning Appraisal companies | Internet Lender Hit with $20 Million Plus in Penalties

http://www.mortgagenewsdaily.com/08122014_mortgage_fraud.asp

Amerisave advertises and lends nationwide.  CFPB contends that between mid-2011 and 2014 the company used online banner ads and searchable rate tables on third-party websites, posted inaccurate rates on these ads, and when consumers followed the ads to the Amerisave website were given rate quotes based on a FICO score of 800 regardless of the score the consumer provided in a questionnaire.   Consumers were required to order and authorize payment for an appraisal before Amerisave would provide a Good Faith Estimate and the company did not tell consumers until later that appraisal orders were being referred to Novo, its affiliated company. 

Here’s a real industry secret, Banks and Finance companies owning Appraisal companies | Internet Lender Hit with $20 Million Plus in Penalties

http://www.mortgagenewsdaily.com/08122014_mortgage_fraud.asp

Amerisave advertises and lends nationwide.  CFPB contends that between mid-2011 and 2014 the company used online banner ads and searchable rate tables on third-party websites, posted inaccurate rates on these ads, and when consumers followed the ads to the Amerisave website were given rate quotes based on a FICO score of 800 regardless of the score the consumer provided in a questionnaire.   Consumers were required to order and authorize payment for an appraisal before Amerisave would provide a Good Faith Estimate and the company did not tell consumers until later that appraisal orders were being referred to Novo, its affiliated company.