Guardian Residential Lending Industry News, February 11-18, 2021
February 18, 2021
In the Know: A Roundup of This Week’s Local and National Real Estate Stories
Are Low Rates Enough to Offset Rising Prices? Builders Say Yes (Mortgage News Daily, Feb. 8)
Even with the accelerating pace of home price increases, the National Association of Home Builders (NAHB) still sees homes remaining affordable. The NAHB/Wells Fargo Housing Opportunity Index for the fourth quarter of 2020 shows that affordability remained steady during the quarter as “record-low mortgage rates offset record-high home prices.”
FHFA extends forbearance period to 15 months (HW, Feb. 9)
Entity also pushes out single-family foreclosure and eviction moratorium to March 31, 2021
Borrowers with mortgages backed by Fannie Mae and Freddie Mac may be eligible for an additional forbearance extension of up to three months, the Federal Housing Finance Agency announced Tuesday. FHFA forbearance plans initially had a 12 month expiration date, however, the government entity is now allowing borrowers up to 15 months of coverage.
According to the agency, eligibility for the extension is limited to borrowers who are on a COVID-19 forbearance plan as of Feb. 28, 2021. The FHFA said other limits may apply to the extension but did not provide specific detail.
Mortgage applications dip as rates climb (HW, Feb. 10)
High refinancing demand bucks usual trend
Mortgage rates have increased in four of the six weeks of 2021, according to Joel Kan, MBA’s associate vice president of economic and industry forecasting, which could be causing the dip in applications.
“Jumbo rates [were] the only loan type that saw a decline last week,” Kan said. “Despite some weekly volatility, Treasury rates have been driven higher by expectations of faster economic growth as the COVID-19 vaccine rollout continues.”
Report: Hidden costs of looming Oregon evictions could top $1 billion (OPB, Feb. 10)
Researchers at Portland State University say the state’s eviction moratorium could cost far more than the value of unpaid rent.
Recent estimates show Oregon renters could owe up to a staggering $378 million in back rent as the pandemic and widespread unemployment rage on. But researchers say this is a small fraction of the cost to Oregon if leaders don’t act to avert the evictions of the estimated 89,000 households that have fallen behind on rent.
A report out Tuesday by Portland State University’s Homelessness Research & Action Collaborative put downstream costs of the mass evictions predicted to occur in Oregon once the eviction moratorium expires in June at as high as $3.3 billion.
For Lenders and Consumers in 2021: 5 Lessons Learned
While 2020 was certainly a strong year for mortgage originations—even during a pandemic—there were many lessons learned that will assist lenders and consumers in 2021 as more and more families want to fulfill their dream of sustainable homeownership.
In the midst of disruption, the mortgage industry was able to quickly adapt to manage their resources between helping consumers purchase homes or refinance existing mortgages while assisting other families in need with participating in programs to keep their homes. Navigating this unprecedented year left us with quite a few lessons to help guide us into 2021. Here are a few areas that industry participants should keep in mind.
- Staffing & Technology Needs Evolve
- The Importance of Training and Development Increases
- Potential for Increase in Mortgage Defects
- An Uptick in Hybrid Mortgage Closings
- Best Practices for Underwriting Working in today’s challenging environment has identified a few industry best practices when it comes to underwriting
Thanks for reading.