Volume 204 | November 1, 2024

Guardian Asset Management

Weekly Newsletter

Guardian endeavors to provide you with the latest in housing, industry and market news from Washington D.C. and around the country. It is our goal as your industry partner to be informative, relative and topical.

10 Things to Know About the

Mortgage and Housing Markets Right Now

Mortgage rates are tricky, mortgage performance is a treat. The U.S. housing market continues to present mixed messages, with home sales lagging last year’s, and mortgage originations doing the same. On the other hand, affordability challenges are reflected in slower rent growth and the need for down payment assistance programs. Let’s take a look at where the current landscape stands:

Expansion of GSE Appraisal Waiver Program

In support of the recent announcements from Fannie Mae and Freddie Mac, Guardian offers a scalable solution in providing inspection-based waivers within its diverse suite of valuation products. With our support, both lenders and borrowers can benefit in time and cost savings in an effort to meeting loan funding and closing objectives. The below links will provide additional information from the GSEs:

Click Here:

Fannie Mae Announces Changes to Appraisal Alternatives Requirements | Fannie Mae

Click Here:

Freddie Mac Expands Offerings with a Focus on First-Time

Click Here:

Freddie Mac Expands Repurchase Alternative Pilot for

Home Owners Unable to Pay Mortgages Increases

Homeowners are struggling to afford their mortgages, and the problem is only getting worse, according to new data from Freddie Mac.

Single-family serious delinquencies surged in September, while multi-family serious delinquencies also saw an uptick for mortgages.

"As property values increase, so do homeowners' insurance rates and property taxes—both often included in escrow accounts that affect the total monthly payment," Kevin Thompson, a finance expert and the founder and CEO of 9i Capital Group, told Newsweek.

"Additionally, many homeowners have adjustable or variable-rate mortgages, which are now experiencing rate hikes. As interest rates have climbed, these mortgage payments have risen as well, making it harder for homeowners to keep up."

Mortgage Rates at 4 Month Highs

More Volatility Ahead

Mortgage rates rates moved moderately higher today, and while that leaves the average 30yr fixed rate only slightly higher than it was on Tuesday morning (7.09 vs 7.08), it's also the highest rate in almost exactly 4 months.

In a break from recent norms, the bond market didn't take cues from data or election positioning. Instead, it was a massive move in European bond markets (UK specifically) that spilled over to the U.S. in the morning hours. Once European markets were closed for the day, US bond markets improved and many mortgage lenders were able to offer token improvements in mortgage rates.

Bonds, which dictate mortgage rates, were ultimately able to log a fairly flat performance versus yesterday. That's the second time this week they've been able to show some signs of resilience, but neither attempt has been very impressive.  

The lack of conviction isn't surprising given the high stakes events on the horizon. Tomorrow's jobs report could easily send rates sharply higher or lower. Next week's election results and Fed announcement represent similar risks (or opportunities). There's no way to know if these high stakes events will be good or bad for rates--only that the potential reaction is huge.

How VA's new last-resort mortgage assistance

is shaping up

Servicers have submitted thousands of loans to the Veterans Affairs Servicing Purchase program launched in May ahead of their October deadline but there's still work to be done.

Around 2,500 of the more than 40,000 eligible veterans for the program have VASP submissions pending, John Bell III, executive director of the Department of Veterans Affairs' loan guaranty service, told attendees at the Mortgage Bankers Association's annual conference.

The department wants to ensure the program, which it introduced in May to fill a gap created by the end of a temporary pandemic relief for distressed borrowers, has been working closely with servicers on the new last-resort assistance. So it's been patient with implementation.

However, he said communication with servicers about the pace of the program is important when it comes to managing the funds allocated for it.

"Right now, here's what I'm most interested in from a budgetary standpoint, what the projection is on how many VASP loans you are going to send," Bell said.

TransUnion: Four in Five Homeowners Say Their Mortgage Payments Strain Their Finances

A new survey from TransUnion, Chicago, found that many consumers feel their mortgage payments are putting a strain on their household finances, and the prospect of falling interest rates has them ready to consider refinancing those loans.

TransUnion’s survey found four in five homeowners say their mortgage payments are straining their finances and are looking to refinance their mortgage payments in the next 12 months.

“We surveyed consumers to better understand the drivers of refinance for both mortgages and auto loans,” said Jason Laky, executive vice president and head of financial services at TransUnion. “Millions of people financed homes and autos during this period of high interest rates, and many will look to refinance as interest rates decline.”

When asked the biggest factor that would ultimately drive them to pull the trigger on a refinancing decision, 70% said that a more favorable loan term would be a key driver for them. However, a nearly identical percentage said that better interest rates (67%) and a cash-out refinance (61%) would also be significant drivers, reflecting broad economic interest.