Posts Tagged mortgage
Six Ways to Improve Your Chances of Getting a Mortgage
Posted by Oksana Grebenjuk in Banks on Апрель 4th, 2011
Remember how Spring was always the home-buying season? Don’t count on that happening this year and you can point the finger, at least in part, at the new lending hoops buyers must jump through. According to MortgageMatch.com, one out of three home buyers will fail to get a mortgage this spring.
Understanding the mortgage process and meeting lenders’ more stringent qualification requirements have become big obstacles for applicants, according to a survey the site conducted. Most recent home buyers — 70% — described the mortgaging process as more difficult than they expected. And those who bought homes during the bubble years, when mortgage loans were given out like candy at Halloween, are especially shell-shocked by the new lending standards.
One of the biggest problems home buyers run into today concern their credit scores and how, in general, they don’t work to improve them before applying for a loan. In the same vein, a recent Fannie Mae survey found that poor credit was the top reason that renters gave for not buying a home.
(Following closely behind poor credit was the self-awareness that they couldn’t actually afford to buy or keep up a home and the perception that now is not really a good time to buy. Hooray for enlightenment on the first point, but with home prices back to 2002 levels and interest rates among the lowest ever seen, how isn’t this a good time to buy?) Read the rest of this entry »
Why Your Bank May Be Wrong About What You Owe on Your Mortgage
Posted by Oksana Grebenjuk in Banks, Favourites on Март 30th, 2011
Attention homeowners with mortgages, whether you’re current or in default: Double-check your mortgage bank’s math. There’s a significant chance that the bank is wrong about how much you owe them, particularly if you’re behind on your payments.
The revelation that mortgage servicers have been incorrectly applying payments and otherwise messing up their records isn’t new. Professor Kurt Eggert of Chapman University documented the problem as early as 2004, and in his recent testimony before Congress, he underscored that nothing had changed. What is new, however, is testimony in New Jersey that gives real insight into how the mistakes are happening.
Late last week, Adrian G. Lofton gave the New Jersey court that is investigating mortgage fraud in New Jersey a sworn statement that details how mortgage servicer records are altered by employees of Lender Processing Services. Although the LPS employees are given logins and passwords to access the banks’ own records for the purpose of correcting and reconciling the files, Lofton, a former LPS employee, explained how they instead destroyed the integrity of the banks’ business records.
How It Works — and Why It Fails
When an LPS client has a mortgage that goes into default, Lofton explains, LPS starts managing the loan. In order to do that, the appropriate LPS employees are given login information for the bank’s database. As a security measure, each login is unique. That login grants access to the bank’s entire database of current and defaulted loans, so that the employee can address whatever problem exists. For example, if a payment that should have been applied to a defaulted mortgage was accidentally credited to a current mortgage, the LPS employee needs access to the current mortgage to fix the error. Read the rest of this entry »
Don’t Bank on It
Posted by Oksana Grebenjuk in Banks on Январь 26th, 2011
Disappointing earnings, shrinking revenues and optimism that somehow the economy is improving despite an ongoing housing hangover — this is what America’s biggest banks offered as they released year-end financial results last week.
«Last year was a necessary repair and rebuilding year,» Bank of America CEO Brian Moynihan said Friday. Yes, we know. The shards of our broken economy remain scattered on the ground and we’re gluing them back together. What else could Mr. Moynihan say as he announced a 2010 loss of $2.2 billion?
«We enter 2011…against a backdrop of an improving economy,» he said. But then he qualified: «Full economic recovery depends on housing-market stability.»
And until we can return to housing-market stability, banks can borrow for next to nothing and lend at rates once charged only by Mafia loan sharks.
Banks enjoy guarantees not to fail unless the U.S. government goes down with them. They remain more or less free from regulations that might significantly curb their reckless risk-taking. And they continue to pay their executives better than rock stars or baseball players. Read the rest of this entry »
Hard for Fed policy to lower unemployment
Posted by Oksana Grebenjuk in Budget on Ноябрь 29th, 2010
The Federal Reserve might risk higher inflation if it focuses on efforts to bring down unemployment, Richmond Fed President Jeffrey Lacker said. In a speech that hinted at his scepticism of the Fed’s latest efforts to stimulate the economy, Lacker, a vocal inflation hawk, said monetary policy can lower joblessness only temporarily.
«Trying to keep unemployment permanently lower than it otherwise would be … is a recipe for continually accelerated inflation,» he said, pointing to the inflation experience of the 1960s and 1970s as a cautionary tale.
With the jobless rate currently stuck at 9.6 percent and inflation running below the Fed’s implicit target of 2 percent or a bit below, the Federal Reserve this month announced it would buy an additional $600 billion in Treasury securities.
The measure, which comes as official interest rates are already effectively zero, is aimed at lowering borrowing costs and spurring lending, and hopefully to boost hiring in the process. However Lacker, who is not a voter this year on the Fed’s policy-setting Federal Open Market Committee, appeared suspicious of the policy. Read the rest of this entry »
Surety Bonds: Investments That Protect Investments
Posted by Oksana Grebenjuk in Investing on Ноябрь 2nd, 2010
Anybody who contributes their time, effort, and, of course, finances to a project feels more confident about the decision if the commitment can somehow be assured. When it comes to finances — whether personal or corporate — surety bonds provide this guarantee. Most industries in America utilize surety bonds to provide protection for those investing in business deals, as well as those who might be vulnerable after a contractual agreement has been made.
Surety bonds essentially work as a legal contract between three parties:
1. The Principal: the entity required to purchase the bond to guarantee the quality of work to be done
2. The Obligee: the entity that requires the bond to protect its interests
3. The Surety: the agency that issues the bond to the principal and assures the obligee with a financial guarantee
The bond is written to assure the obligee that the principal will fulfill all duties appropriately, whether developing construction projects, collecting debts, or signing official documents as a notary. If the principal fails to uphold the guarantee outlined in the bond’s language, then the obligee can make a claim on the bond. If the principal is unable to compensate the obligee, the surety will be held accountable for reparation, whether achieved financially or otherwise. Read the rest of this entry »
Indonesia claws its way to economic superpower status
Posted by Oksana Grebenjuk in Trading Markets on Октябрь 5th, 2010
Indonesia is one of the «rising stars» of emerging Asia and some economists believe this vast nation will one day become a regional superpower, behind only China and India, as global economic activity increasingly shifts towards east Asia, away from the faltering developed nations of the west and Japan.
The country is delivering a torrid 6 percent annual GDP growth rate. Indeed, the Jakarta Stock Exchange has soared almost 40 percent this year, recently touching a new record closing high.
The Asian Development Bank expects Indonesia to grow its economy by 6.1 percent this year, and 6.3 percent in 2011.
“Economic recovery in many Western countries affected by the global financial crisis is uncertain,» Deloitte Asia Pacific CEO Chaly Mah told The Jakarta Post in a recent interview. «It’s relatively patchy. They are still struggling with economic challenges, and the unemployment rate remains high. There is still no clear sign of economic growth there.»
Indonesia, boasting a population of 240-million, also features a huge working class population (estimated at 58-million), an expanding manufacturing base, moderate labor costs, a sound financial services sector, tremendous natural resources (including oil and gas reserves), as well as a relatively stable political system. Read the rest of this entry »
Optimism…Pessimism…And A Bit Of Perspective
Posted by Oksana Grebenjuk in Budget, Favourites on Сентябрь 6th, 2010
Here’s how I’m tempted to summarize today’s release of the August employment report from the U.S. Bureau of Labor Statistics: more of the same. That theme fits nicely with comments this morning from Atlanta Fed President Dennis Lockhart, in a speech at East Tennessee State University. Here he calls for a little perspective:
«Some commentators are reading recent economic data as suggesting the onset of a second recession and deflationary cycle. Quite naturally, business people and consumers aren’t sure what to believe.
«At the last meeting of the Federal Open Market Committee (FOMC) in Washington, the committee made a decision that has been widely interpreted as signaling declining confidence in the strength and sustainability of the recovery….
«In my remarks today, I will provide a less alarmist interpretation of recent economic information and the Fed’s recent policy decision. I will argue that, generally speaking, there was too much optimism in the early months and quarters of the recovery and now there may be excessive pessimism.»
One point is that recoveries are not generally linear affairs: Read the rest of this entry »
4 Investment Ideas That Provide Income
Posted by Oksana Grebenjuk in Investing on Июль 1st, 2010
As of this moment, the S&P/TSX Composite index is down 384.58 point or -3.27% year to date. The S&P 500 is down 67.32 or -6.04% year to date. That is your market update. When the global economic outlook appears uncertain and on the brink of another recession, equity markets reflect this reality in terms of greater than normal volatility. In markets like these, what we should be looking for are non-correlated assets and managers that have demonstrated the expertise to preserve capital during uncertain times like today.
In addition, one should also be focusing their efforts on receiving some form of income while the economic climate sorts itself. The following 4 ideas should hopefully accomplish both those goals. While we cant speak to the best/worst time to buy/sell particular securities, as that depends on one’s personal circumstances, the approach we usually take, especially with closed end funds, is to purchase them when they are trading at the steeper than normal discount to their Net Asset Value (NAV). The only other thing we would like to add is that you should do you own due diligence.
Trident Performance Corp.
This closed end fund is managed by CI Investments. Its investment objective is to provide tax-efficient risk-adjusted long term rates of return by obtaining exposure to a Global Macroeconomic Portfolio, advised by Trident Investment Management. Co-Founded in 1998, by Nandu Narayanan, Trident Investment Management seeks to exploit macroeconomic trends to generate attractive risk-adjusted rates of return with low or negative correlation to traditional ‘long’ investments. This is exactly what Mr. Narayanan did during the financial crisis, when the CI Global Opportunities Fund recorded positive performance of 109% in 2007 and 42.6% in 2008. Since inception in March 1995, the fund has averaged 19.69% as of the end of May 31, 2010. Read the rest of this entry »
Mortgage Data Leaves Bankers Uncertain of Trend
Posted by Oksana Grebenjuk in Banks on Май 24th, 2010
Any way you look at it, extraordinary numbers of people are having trouble paying their mortgage. What is less clear is the extent to which the problem is getting worse, better or is simply holding its own.
Data released Wednesday by the Mortgage Bankers Association showed the mortgage delinquency rate rose in the first quarter to 9.38 percent of all loans outstanding, from 8.22 percent in same period last year.
When adjusted for seasonal variations, the default rate rose over 10 percent for the first time.
Seasonal adjustments are used to smooth out data in ordinary times, but in these extraordinary times the bankers’ group said it was not sure how much they could be trusted. In the first quarter the seasonal adjustments showed the delinquency rate worsened considerably. The raw data, on the other hand, indicated a marked improvement.
Warning that “fundamental market factors” might be exercising undue influence over the seasonal numbers, the mortgage bankers said they did not know whether the optimistic or pessimistic sequence was more accurate.
“We may be at a point where the market is changing for the better, but we can’t be sure because of the confounding effect of seasonal differences,” said Jay Brinkmann, the group’s chief economist. Read the rest of this entry »
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