REO

Investment bank FBR Capital Markets released its preview of third-quarter earnings for major U.S. banks Monday, with a cloudy outlook for mortgage banking. In general, bank stocks have underperformed the broader market by about 2 percent over the third quarter; and zeroing in on the mortgage market, FBR is not optimistic about Q3 results.

Zillow partnered with the Federal Housing Finance Agency (FHFA) Thursday to review eligibility requirements for the Home Affordable Refinance Program (HARP) and respond to borrowers confused about the program. Meg Burns, senior associate director for housing and regulatory policy for FHFA, joined Zillow for a Google Hangout session to field questions from underwater homeowners and explain HARP's finer points.

The Federal Housing Administration (FHA) will be accepting a bailout of more than $1 billion to make up for losses sustained from the agency's legacy books and its reverse mortgage program. Following reports last week that FHA's financial situation would require a Treasury draw in the neighborhood of the Obama administration's $943 million forecast, Commissioner Carol Galante revealed in a letter to the Senate Banking Committee that the agency is taking an appropriation of approximately $1.7 billion.

Continuing to respond to higher mortgage rates, the Pending Home Sales Index (PHSI) slipped for the third straight month, dropping 1.6 percent in August to 107.7 the lowest level since April, the National Association of Realtors which compiles the index reported Thursday.

Continuing the drop in first time claims for unemployment insurance, initial filings fell 5,000 for the week ended September 21 to 305,000, the Labor Department reported Thursday. Economists had expected the number of claims to jump up to 330,000, from the 309,000 originally reported for the week ended September 14.

July property data from Homes.com shows that property values in nearly one-quarter of the top 100 U.S. markets have fully recovered. According to the site’s latest report, 22 of the top 100 markets in the United States reported price increases of more than 100 percent from their respective troughs, up from 19 the month prior.

Household net worth improved $1.3 trillion in the second quarter -- half as fast as the first -- as real estate values grew $626.7 billion, the Federal Reserve reported Wednesday in its quarterly Flow of Funds report. But, with a drop in mortgage debt from $9.39 trillion in the first quarter to $9.34 trillion in the second, homeowner equity grew to 49.8 percent.

Builders lowered prices and buyers responded in August, pushing new home sales up 7.9 percent to 421,000, reversing almost half of July’s 64,000 drop in sales, the Census Bureau and Department of Housing and Urban Development reported Wednesday. Economists surveyed by Bloomberg expected June sales to rise to 425,000 from July’s originally reported 394,000.

Consumer confidence dipped in September as Americans expressed doubt over the current direction of economic conditions. The Conference Board’s Consumer Confidence Index, which picked up to 81.8 in August following a drop the month prior, fell to 79.

Home prices rose in July by less than two percent for the first time since March but still reached their highest level since August 2008, according to the Case Shiller Home Price Indexes released Tuesday. The 20-city index was up 1.8 percent in July 12.4 percent in the last year — while the companion 10-city index was up 1.9 percent.