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- CFPB’s Efforts to Tighten Mortgage Lending Practices Would Hurt Housing Market
“The pendulum has swung from way too crazy to too conservative,” said Sam Khater, senior economist at CoreLogic. “That’s human nature. The rules are aimed at protecting consumers from hurting themselves.”
The CFPB acknowledged that “there are many instances in which consumers can afford a debt-to-income loan above 43 percent.” The agency also conceded banks “initially” may be reluctant to lend because of uncertainty about implementing the new federal rules, according to U.S. News, but it said it is carrying out its Dodd-Frank legal mandate.
Last week, six federal regulatory agencies released a reworked proposal requiring lenders to keep a stake in the loans they bundle and sell as securities, part of the efforts to limit the type of underwriting practices that caused the housing bubble, Reuters reported.
In the years heading into the 2007-09 financial crisis, banks used questionable underwriting standards under the belief that they could sell loans while avoiding consequences if the borrowers defaulted.
How long will it be before they’ve overly relaxed the standards? It always seems to turn out worse than if the standards had remained a bit too tight.
It would be better for people to rent what they can afford than buy what’s beyond their ability to pay.
Read the source article … https://www.moneynews.com/FinanceNews/CF PB-mortgage-refinancing-rules/2013/09/05 /id/523936
- Bay Area Home Prices Cooling Off – CBS San Francisco
SAN FRANCISCO (CBS/AP) — A research firm said home prices in the San Francisco Bay Area began to cool off last month after a torrid run.
California posted its strongest homes sales for any August in seven years as price increases cooled, a research firm said Friday, a relief to buyers who have been competing over slim pickings.
It could reverse again for a while on the Fed’s delayed taper. However, there’s new construction on tap.
Read the source article … https://sanfrancisco.cbslocal.com/2013/0 9/13/bay-area-home-prices-cooling-off/
- House Prices Set For Significant Decline: Sun Life Exec
…The Economist magazine, … recently reiterated its assertion that Canada has one of the world’s most “bubbly” housing markets. It estimated house prices are overvalued by 30 per cent compared to incomes, and by 74 per cent when compared to rental rates.
Read the source article … https://www.huffingtonpost.ca/2013/09/14 /house-prices-decline-sun-life_n_392689 1.html
- Mortgage Lending Faces Big Risks From 2nd Liens, Delinquencies, and Higher Rates
This is pre-taper delay, but it’s still a great mortgage-banking-and-servicing risk-management overview.
Read the source article … https://www.mortgagenewsdaily.com/091220 13_risk_management.asp