Home Mortgage

Intelligent Buyers Should Be Focused on Rates Written by Jonathan Smoke    09.08.2008 While debates rage on when we will find the bottom in home prices declines, intelligent buyers who’ve been waiting on the sidelines should be paying attention to mortgage rates as well. Beyond credit quality and the type and length of loans, two factors influence how consumers buy a home—the price of that home and the interest rate of the mortgage. The price of the home and the interest rate of the mortgage each have a significant impact on the monthly payment, so assuming would-be buyers are trying to time the bottom on when to purchase a home, ignoring what is happening to interest rates and where they are likely headed could lead to regrets. No comments for this item Read more...   Are We Nearing a Top in Foreclosure Activity? Written by Jonathan Smoke    07.10.2008 The ForeclosurePulse blog from the folks at RealtyTrac has a great post today about the release of their June data. The June data showed that U.S. foreclosure activity in June decreased 3 percent from May but was still up 53 percent from the prior year. The blog post nicely raised the question if this is a sign of a top or not. The argument against this being a top is that the year-over-year comparison still shows foreclosures much higher. Moreover, there have been several months during the last two years that month-over-month activity registered declines. No comments for this item Read more...   New Research Sheds More Light on Subprime’s Impact Written by Jonathan Smoke    12.04.2007 The lead article on the front page of yesterday’s Wall Street Journal debunked the misconception that only those with poor or limited credit hold subprime mortgages. Whether people wanted the convenience of avoiding documenting income or made decisions based on aggressive and potentially fraudulent -- or at least unethical -- mortgage brokering, a large number of people who could have had prime mortgages ended up in subprime mortgages during this decade. No comments for this item Read more...   Mortgage Mess Driven by Local Issues Written by Jonathan Smoke    09.07.2007 What are the three most important words in real estate? Location, location, location. I try regularly to illustrate the economics behind that bit of wisdom that was passed on to me early in my career. That’s why I was surprised to see a post from Maya Roney at Business Week on the Hot Property blog entitled “Real Estate Is Not All Local.” Roney’s thesis appears to be that the mortgage problems are national so the impact to home sales is in part national. No comments for this item Read more...   In Search of the Bad Loans and the Lenders Behind Them Written by Jonathan Smoke    08.22.2007 A new study released this week by SMR Research presented some fairly compelling evidence that there are indeed huge differences in the credit risk of the loan portfolios of the nation’s largest lenders. In “The Mortgage Credit Crisis,” Stuart Feldstein and his colleagues present the model they developed to identify credit risk and the results of applying that model to “very large samplings” of each lender’s loans. No comments for this item Read more...   Measuring Risk in Residential Mortgages Written by Jonathan Smoke    08.20.2007 As the housing downturn has worsened since March with the unwinding of the subprime market, the market has been fixated on the debt side of housing. Now with increasing concerns that the subprime meltdown will impact prime credit and even other asset classes, it has been a little surprising to see how nervous Mr. Market is about the level of risk in securitized mortgage pools and portfolios. No comments for this item Read more...   Shared Appreciation Mortgages Come to America! Written by Bill Russell    05.23.2007 Business Week’s Hot Property blog on May 17 pointed me towards some news I was happy to hear. A company in the US, REX & Co., is now offering a form of Shared Appreciation Mortgage to the US public. A shared appreciation mortgage lets you sell a percentage of your home’s future appreciation (or depreciation) to a third party for cash. Having this option is good for everybody involved. No comments for this item Read more...