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Before Pandemic – San Diego fastest rising home prices in Calif; after pandemic ?

Posted on April 29, 2020 | Leave a comment

San Diego County homebuyers, like most of the nation, shrugged off early COVID-19 fears in February as prices increased more than any other California market.

Home prices in the San Diego metropolitan area had risen 4.6 percent in a year, the S&P CoreLogic Case-Shiller Indices reported Tuesday.

The index reflects a strong economy up until the moment the coronavirus began entering the American psyche and massive job losses followed. All home prices in the 20-city index were up and the nationwide average yearly increase was 4.2 percent.

Selma Hepp, deputy chief economist for CoreLogic, said the report showed enthusiasm for home purchases in February for a variety of reasons.

“Things were looking up for the housing market in mid-winter, with low interest rates and still-secure job prospects combining to boost demand for housing,” he wrote, “just as a growing share of millennials were looking to finally take the leap into homeownership.”

There are already signs interest in homebuying has tapered off since March, as well as a many homes being taken off the market. Redfin data shows 13.1 percent of homes in San Diego County were delisted from March 14 to April 10.

Mortgage chaos threatens to worsen once it’s time for repayment

Posted on April 28, 2020 | Leave a comment

The problem is confusion over what will happen when borrowers have to make up those payments. Federal agencies that back most of the market have introduced policies, some of which could require documentation that overwhelms servicers, leading to lengthy wait times and, in extreme cases, foreclosures.

Industry executives say Fannie Mae, Freddie Mac and their regulator are attempting to unveil a program in coming weeks that could alleviate many of the problems. Mortgage lenders say they hope the companies and their watchdog come up with a plan that prevents a repeat of the turmoil that followed the 2008 financial crisis, when confusion and delays hindered borrowers in trying to resume payments.

A Fannie spokesman referred a request for comment to the regulator, the Federal Housing Finance Agency. An FHFA spokesman didn’t comment on whether there is a fix in the works. A Freddie spokesman didn’t respond to requests for comment.

The $2.2 trillion stimulus package passed by Congress last month requires mortgage companies to let borrowers delay payments for at least six months if they have been hurt by the pandemic. Because the government wanted to provide help quickly, borrowers merely need to say they face a hardship to receive aid.

Fannie and Freddie have released an array of more-complicated options. Borrowers can choose to repay the forbearance in as long as 12 months, but if they can’t, they have to apply for a loan modification, which servicers say could trigger delays and documentation issues like those that occurred after the 2008 crisis.

An FHFA spokesman said Fannie and Freddie forbearance repayment options “allow servicers to work with borrowers to find a repayment option that works best for all parties.” He noted an FHFA announcement on Monday that made clear borrowers won’t be forced to repay forbearance in a lump sum.

Home lenders growing more cautious

Posted on April 26, 2020 | Leave a comment

Mortgage lenders are battling economic uncertainty by raising minimum credit scores, requiring higher down payments, triple-checking employment status and even eliminating certain loan types altogether.

As job loss reached staggering heights due to the coronavirus pandemic (more than 16.8 million workers have filed jobless claims in the past two weeks), fear strikes deep among lenders worried that high unemployment numbers will translate into mortgage defaults and late payments down the road.

Lenders handpick low-risk borrowers as bulwark for cratering economy

Chase recently announced that it would raise its minimum credit score requirement to 700 and hike the minimum down payment up to 20 percent, from 3.5 percent. Lenders large and small across the country are following suit.

Wells Fargo and US Bank both adjusted their minimum score requirement to 680 (including for FHA and VA loans, which typically feature lower credit-score requirements as low as 580), while Flagstar Bank upped its minimum to 640.

Better.com temporarily stopped offering FHA loans, while also increasing its minimum FICO score for borrowers. They’re still offering jumbo loans; however, they no longer lend to anyone with higher than an 80 percent loan-to-value (LTV) on jumbos.

Navy Federal Credit Union also stopped offering FHA loans, with the hopes that they will resume that product in early 2021, “but that’s not fully confirmed at this point,” said a spokesperson for Navy Federal Credit Union.

Before Pandemic – San Diego fastest rising home prices in Calif; after pandemic ?

Mortgage chaos threatens to worsen once it’s time for repayment

Home lenders growing more cautious

Lenders handpick low-risk borrowers as bulwark for cratering economy

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