The U.S. homeownership rate as of this
past third quarter, up 40 basis points
year over year
Source: U.S. Census Bureau
The year-over-year increase in loan
applications for new-home purchases
this past October
Source: Mortgage Bankers Association
FHA insurance-fund reserves dip in fiscal 2017
The Federal Housing Administration (FHA) mortgage fund narrowly remained
in healthy territory in fiscal year 2017, the U.S. Department of Housing and Urban
Development (HUD) reported in its annual report to Congress. The Mutual Mortgage
Insurance Fund’s (MMIF’s) capital cushion declined to 2.09 percent, down from
2.35 percent in fiscal 2016. The fund’s total economic net worth as of Sept. 30, the
end of the 2017 fiscal year, was $25.6 billion, down from $27.6 billion a year earlier.
HUD officials said the decline was due to volatility in the reverse mortgage program.
FHFA proceeds with language-preference question
The Federal Housing Finance Agency (FHFA) decided late in 2017 to include a language
question on the standard application form used by borrowers to apply for Fannie Mae
and Freddie Mac loans. The decision was a victory for some consumer-advocacy groups
that have said a tweaking of the form would provide needed data on non-English
speaking borrowers, as well as help lenders better serve this population. It was a loss
for mortgage banking groups that are concerned that once lenders start asking about
borrowers’ language preferences, it would potentially open up a Pandora’s box of legal
obligations requiring the industry to serve borrowers in scores of different languages.
Loan-delinquency rate rises after hurricanes
A string of hurricanes that ravaged portions of Texas, the Gulf Coast region and Puerto
Rico this past August and September pushed loan delinquencies up in third-quarter
2017 from historic lows. The loan-delinquency rate inched up to 4. 88 percent this past
third quarter, 36 basis points higher than a year earlier, the Mortgage Bankers Association (MBA) reported. The MBA said the foreclosure rate was likely to fall in the near
future, however, thanks to government-backed programs that enabled storm-affected
borrowers to miss loan payments without triggering defaults.
Home prices keep moving up
Home prices made another solid annual gain this past September, CoreLogic reported.
Prices jumped up 0.9 percent from the August reading and rose 7 percent year over
year, the company said. CoreLogic, however, identified several major cities that it
deems overvalued — places where the homes prices have exceeded by 10 percent the
long-run average considered sustainable by an area’s income. Major cities on the list
include: Las Vegas, Denver, Los Angeles, Miami, Washington, New York and Houston.
FHA loan volumes cool off
The Federal Housing Administration reported that it endorsed 305,438 mortgages,
excluding reverse mortgages, from April through June 2017 (the federal government’s
third fiscal quarter), down 3. 7 percent compared to the same period in 2016.
The decline in overall endorsements in the fiscal third quarter was driven by a steep
drop in rate-and-term refinancing, which is in line with general mortgage market
trends, the Department of Housing and Urban Development reported. n
By Victor Whitman
The percentage of all home sales in
third-quarter 2017 involving distressed
properties (bank-owned, foreclosure
auctions or short sales), a 10-year low
Source: Attom Data Solutions