Market Studies

Based on data from six member firms, Mortgage Insurance Companies of America (MICA) reports that the companies accounted for a total of $780.3 billion in primary mortgage insurance in force in August. The private mortgage insurance industry enjoyed its best month of the year for new business. The dollar volume of primary insurance on newly originated conventional mortgages totaled $6.4 billion. MICA's members reported that 32,215 borrowers used private mortgage insurance to buy or refinance a home in August.

The Mortgage Bankers Association's (MBA) index of loan applications for home purchases jumped 9.3 percent last week as mortgage interest rates dropped again. It's the highest reading for purchase activity since the expiration of the homebuyer tax credit, and could signal a rebound in home sales ahead. The increase was led by a 17.2 percent upsurge in Federal Housing Administration (FHA) applications, as borrowers sought to beat the agency's October 4th effective date for higher credit score and down payment requirements.

There was something for everyone in September when looking at the delinquency rate for loans held in commercial mortgage-backed securities (CMBS), according to the research firm Trepp LLC. For commercial real estate bears, the fact that the rate once again set a record at 9.05 percent is a sign that the real estate crisis is not yet over in the commercial sector. The bulls, however, can point to the fact that the September increase in the delinquency rate is the second smallest for 2010.

If governmental policy on foreclosure prevention does not change, 11.5 million borrowers are in danger of losing their homes, according to the analysts at Amherst Securities. That staggering figure equates to one out of every five borrowers - an astronomical 20 percent default rate. So how can the administration fix deficiencies in its loan modification program? Amherst analysts say the answer lies in cutting borrowers' principal balances and boosting housing demand, including opening up financing channels for investors.

Pending home sales have increased for the second month in a row, the National Association of Realtors (NAR) reported Monday. The trade group's index is a forward-looking indicator of home sales based on signed contracts. It rose 4.3 percent in August. Lawrence Yun, NAR's chief economist, says a continuing rise in the pending sales index is to be expected from favorable affordability conditions and possible job creation, but he warns that a sudden rise in mortgage rates could stall the recovery.

The Mortgage Bankers Association (MBA) has released a report regarding the results of research examining international mortgage products and comparing them with the mortgage products in the United States. The study found that features and products that are restricted in the Dodd-Frank Bill are widespread in other countries and are not necessarily believed to cause high rates of default. The trade group says the new regulations will deeply impact borrower choice.

eMortgage Logic and the National Association of Broker Price Opinion Professionals (NABPOP) released Thursday a new version of the BPO Standards and Guidelines (BPOSG). The BPOSG provide wide-ranging parameters for the preparation of Broker Price Opinions (BPOs) throughout the BPO industry, and includes suggested practices for selecting and utilizing properties, pricing considerations, and ethical and competency considerations.

How low can we go? When it comes to mortgage rates, the floor keeps dropping. Industry reports released Thursday show that interest rates for home loans - already at their lowest marks in more than a half-century - dropped again this week. Market analysis conducted by Freddie Mac puts the 30-year fixed rate at 4.32 percent and the 15-year rate at 3.75 percent. Bankrate says rates for the larger jumbo 30-year fixed mortgage also inched lower to 5.16 percent.

New data released by RealtyTrac Thursday shows that foreclosure and REO homes accounted for 24 percent of all residential sales during the second quarter. A total of 248,534 properties in default, scheduled for auction, or repossessed by the bank sold to third parties during the April to June timeframe. RealtyTrac says on average, these homes went for a discount of 26 percent. The second-quarter share of foreclosure sales is up nearly 5 percent from the previous quarter, but still down 20 percent compared to the second quarter of 2009.

It's no secret that the volume of distressed residential properties is weighing heavy on U.S. housing markets and prolonging any meaningful recovery. Of even greater concern is the industry's growing backlog of homes that need to be liquidated and resold but have yet to make their way to the market. Standard & Poor's has just released a new report in which it estimates that the principal balance of this shadow inventory now stands at $460 billion and will take the industry about 41 months to clear.