The Norris Group Blog

Today’s New Synopsis:

The MBA’s survey shows that mortgage applications decreased by 4.5 on a seasonally adjusted basis from last week. Freddie Mac’s survey shows that the 30-year FRM decreased by 0.7 points from the previous week. Standard & Poor’s, Moody’s, and Fitch are being sued for inflating ratings.

In The News:

Mortgage Bankers Association - “Mortgage Applications Decrease in Latest MBA Weekly Survey” (11-25-09)

“The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending November 20, 2009.  The Market Composite Index, a measure of mortgage loan application volume, decreased 4.5 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 5.8 percent compared with the previous week.”

Housing Wire – “30-Year Fixed Mortgage Rates at Historic Lows” (11-25-09)

“Freddie Mac’s (FRE: 1.12 -0.88%) weekly survey put the 30-year FRM at 4.78% with a 0.7 point, down from last week when it was 4.83% and one year ago when it was 5.97%. This week’s rate ties the record for lowest ever in the weekly survey’s history, which was previously reached twice in April this year.”

Housing Wire – “Fannie’s MBS Issuance Slides 31% in October” (11-25-09)

“Fannie’s gross mortgage portfolio declined at an annualized rate of 27.8% and stood at $771.4m at the end of the month, according to the monthly summary”

DSNews - “Rating Agencies Face Lawsuit for Allegedly Misleading MBS Investors” (11-24-09)

“Cordray is suing Standard & Poor’s, Moody’s, and Fitch for allegedly providing inflated ratings of mortgage-backed securities (MBS) in exchange for lucrative fees from the securities issuers the agencies say they were objectively evaluating. The lawsuit was filed Friday in a U. S. District Court on behalf of five Ohio public employee retirement and pension funds. Cordray says the case is not intended to take on the status of a class-action lawsuit.”

DSNews - “Bank of America Helps 100,000 Homeowners Avoid Foreclosure” (11-24-09)

“In an effort to help borrowers with Countrywide subprime and option-ARM mortgages avoid foreclosure, Bank of America created its National Homeownership Retention Program (NHRP), providing mortgage relief to 100,000 eligible homeowners in just 10 months. In the third quarter alone, more than 31,000 customers received assistant through the NHRP, according to the bank’s quarterly progress report.”

Bloomberg - “Sales of New Homes in U.S. Rise to Highest Since 2008″ (11-25-09)

“Purchases of new homes in the U.S. rebounded more than anticipated in October as buyers rushed to take advantage of a government tax credit before it expired. Sales rose 6.2 percent to an annual pace of 430,000, the highest level since September 2008, the Commerce Department said today in Washington. The median sales price fell 0.5 percent and the number of unsold homes reached a four-decade low. ”

Bloomberg - “Fed Officials Watch Asset Prices for Signs of ‘Excessive Risk’” (11-25-09)

“Federal Reserve policy makers said for the first time that their decision to cut interest rates to zero may be fueling undue financial-market speculation even as they called the dollar’s decline ‘orderly.’ The Federal Open Market Committee said its policy of keeping rates low might cause ‘excessive risk-taking’ or an ‘unanchoring of inflation expectations,’ according to minutes of its Nov. 3-4 meeting released yesterday.”

Bloomberg - “First American Flips Real Estate Stocks to Beat Fund Rivals” (11-25-09)

“John Wenker and Jay Rosenberg, managers of First American Real Estate Fund, buy and sell stocks more often than their peers, a strategy that helped them outperform 98 percent of rivals in the past decade. The $1.1 billion fund’s turnover ratio, a measure of how often its holdings are traded, is 150 percent, according to data from Morningstar Inc. That compares with an average of 104 percent for all real estate funds. ”

Realty Times – “Internet Stealth Auctions Protect Brand, Generate New Homes Sales” (11-25-09)

“Brown needed to sell his five models. He hired an internet marketing company to help him, then challenged them to design a program around a ‘call to action.’ The company, SaleAMP, suggested the developer give new home buyers what resale real estate thrives on: the opportunity to make an offer- but to do it quietly, fast and with internet marketing thrust at full throttle.”

Realty Times – “Short Sale Sellers Need To Guard Against ‘Double Whammy’ By Bank and I.R.S.” (11-25-09)

“Bad enough that a short sale involves the loss of one’s home with no equity to show for it, and a credit negative that may last for years; it also has the potential to produce two very bad after-effects. One is that the lender, or the lender’s assignee, may continue to pursue the beleaguered seller for the remainder of the debt. The other is that the I.R.S. may come knocking on the seller’s door, seeking tax on the amount of debt that was unpaid. ”

Looking Back:

One year ago, a survey from AARP showed that 25 percent of baby boomers desired to move from their current home. The MBA reported that 32.9 percent of all mortgage applications were government-insured. Total home sales in 2008 increased by 17 percent from 2007.