| Not A Typo: Mortgage Applications Rise 49% | |
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Mortgage applications skyrocket as rates fall (Part 2 of 4) (Continued from Part 1) Mortgage applications increase 49% as bonds rally
The Mortgage Bankers Association (or MBA) Applications Index rose 49% after rising 16% the week before. Mortgage applications had been mired at lows not seen in more than a decade and really did not react as rates began falling in earnest last summer. This has been a function of tighter credit, a low inventory of homes for sale, and sticker shock as home prices have risen while wages have not.
Federal government tries to help the first-time homebuyer
Recently, the federal government made two big moves to try to help out the first-time homebuyer. The first-time homebuyer has been more or less absent from the real estate market and is a big reason why we’re still at depressed levels in housing starts six years after the crisis. The first-time homebuyer has been squeezed between tight credit, heavy student loan debt, and a lousy labor market.
To address this, the Federal Housing Finance Agency made a few changes. First, it brought back the 3% down conforming loan and gave homebuyers a break on mortgage insurance if they go through a counseling program. Second, and more recently, the federal government lowered the annual mortgage insurance premium for FHA loans from 135 basis points a year to 85 basis points a year. This will save buyers hundreds of dollars per year in mortgage insurance premiums, which was intended to make loans more affordable.
The impact of falling rates
Originators had a dismal 2014, as the refi (refinance) market dried up and the purchase market remained moribund. Mortgage bankers have been playing defense with the regulators as well, making sentiment for originators such as PennyMac (PMT), Redwood Trust (RWT), and Ocwen Financial (OCN) downright depressing.
A drop in rates should spur more activity and make housing more affordable, even without home prices falling. Even mortgage REITs such as Annaly Capital Management (NLY) and American Capital Agency (AGNC) will benefit from mark-to-market gains on their MBS (mortgage-backed securities) holdings, although prepayment speeds are increasing again.
Continue to Part 3 Browse this series on Market Realist:
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International Montoro Resources Inc
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DEVELOPMENT STAGE |
CODE : IMT.V |
ISIN : CA46004W1086 |
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ProfileMarket IndicatorsVALUE : Projects & res.Press releasesAnnual reportRISK : Asset profileContact Cpy |
Intl Montoro Res. is a gold and copper exploration company based in Canada. Intl Montoro Res. develops gold, copper and uranium in Canada, and holds various exploration projects in Canada. Its main asset in development is CUP LAKE/DONEN in Canada and its main exploration properties are PARTRIDGE RIVER, STORMY LAKE, SERPENT RIVER, BATEMAN/SHAVER TOWNSHIP, BATEMAN TOWNSHIP, MALACHITE, OVERTIME, CRACKINGSTONE RIVER, SHEEP TRAIL MINE, EAST BAY JV (RED LAKE) and RED LAKE (BATEMAN / SHAVER) in Canada. Intl Montoro Res. is listed in Canada. Its market capitalisation is CA$ 6.1 millions as of today (US$ 4.9 millions, € 4.0 millions). Its stock quote reached its highest recent level on December 31, 2007 at CA$ 0.93, and its lowest recent point on March 27, 2020 at CA$ 0.01. Intl Montoro Res. has 76 260 000 shares outstanding. |