Blog | Facebook

| Twitter

| My Account

Blog Archives

04/23/2012 - Housing Supply Decreases, Good for Housing
by Quentin Keefe

Housing Supply Decreases, Good for Housing:

In the latest release of the National Association of Realtors' Existing Home Sales report, there were some very interesting facts. Even though they reported a month-over-month decrease of 2.6% in existing home sales, they revised February's data upward. The NAR said even with March's decline, the pace of sales in the first three months of the year marked the strongest first quarter since 2007.

But the real gem is the inventory data. The nation's glut of unsold homes is easing, as inventories fell to 2.37 million. Realtors in some markets have even reported shortages of housing stock. A decrease in the amount of homes on the market is always good for housing as it stabilizes and even drives prices upward. Nationwide, the median price for a home resale rose to $163,800 in March, up 2.5 percent from a year earlier.

An improving labor market has realtors upbeat about sales prospects for the rest of the year.

Distressed home sales accounted for only 29 percent of resales, down from 34 percent in February, which is also a very positive trend.

What Happened to Rates Last Week?

Mortgage backed securities (MBS) gained +15 basis points from last Friday to the prior Friday which caused mortgage rates to move sideways.
The highest rates of the week were on Tuesday and the lowest rates of the week were on Friday.
MBS traded in a very narrow range all week as we had a light week in terms of the economic data that was released.
Retail Sales were much better than expected but Initial Jobless Claims and Existing Home Sales were worse than expected, there were no major Treasury auctions to guide the market last week.

04/16/2012 - Housing Poised for Spring Recovery
by Quentin Keefe

The Housing Market Update

Regency Mortgage Corp.

04/16/2012

Housing Poised for Spring Recovery:

Five years after the U.S. housing bust sent sales and prices plunging, the spring home-buying season is pointing to a long-awaited recovery.

Reduced prices, record-low mortgage rates, higher rents and an improving job market appear to be emboldening many would-be buyers.

Open houses are drawing crowds. A wave of foreclosures is leading investors to grab bargain-priced homes.

And many people seem to have concluded that prices won't drop much further. In some areas, prices have begun to tick up.

"The biggest challenge that we've had over the past four years is fear — fear that the economy is collapsing, that property values are collapsing, that the world is coming to an end," says Mark Prather, a broker at ERA Buy America Real Estate in La Palma, Calif. "The fear factor is all but gone."

The spring buying season got an early lift-off from an uncommonly warm January and February — a winter that was the best for sales of previously occupied homes in five years. Permits to build houses and apartments rose in February to their highest level since 2008.

"People feel much more confident," said Steve Brown, co-owner of real estate company Irongate Inc. of Dayton, Ohio, who says sales jumped more than 16 percent for the first two months of 2012 over the same period last year. "There's no question there's a good feeling in the marketplace."

Some analysts detected a slight uptick in prices for February and March. CoreLogic, a real estate data firm, says prices for homes not at risk of foreclosure — about two thirds of the market — rose 0.7 percent in February. It was the first increase in four years. Price gains occurred both in some hard-hit areas, such as Phoenix, and some still-thriving areas like New York and Washington.

Also fueling interest are signs that home values are finally stabilizing. One factor that had slowed purchases after the housing boom ended in late 2006 was fear that a home would lose value soon after its purchase.

What Happened to Rates Last Week?

Mortgage backed securities (MBS) gained just +3 basis points from last Friday to the prior Friday which caused mortgage rates to move sideways.
The highest rates of the week were on Wednesday and the lowest rates of the week were on Tuesday. The difference between our best and worst pricing for the week was a whopping 109 basis points which shows a lot of volatility.
Mortgage rates dipped Tuesday afternoon in reaction to global concern over Spain and Italy's debt woes. Mortgage rates then reversed course and increased both Wednesday and Thursday in reaction to the release of the Fed's Beige Book (named for the color of its cover). The Beige Book contains the economic data that the Fed will use to base their next policy move. In this report, the economic conditions in most districts were improving which led investors to believe that there would be a reduced chance for the Fed to have another round of quantitative easing.
Mortgage rates then reversed course again, and improved on Friday in reaction to a weak stock market and milder than expected University of Michigan Consumer Sentiment reading.

What to Watch Out For This Week:

The following are the major economic reports that will hit the market this week. They each have the ability to affect the pricing of Mortgage Backed Securities and therefore, interest rates for Government and Conventional mortgages.

Date	Time (ET)	Economic Relase	Actual	Estimate	Prior
16-Apr	8:30 AM	Retail Sales	-	0.30%	1.10%
16-Apr	8:30 AM	Retail Sales ex-auto	-	0.60%	0.90%
16-Apr	8:30 AM	Empire Manufacturing	-	17.5	20.2
16-Apr	9:00 AM	Net Long-Term TIC Flows	-	NA	$101.0B
16-Apr	10:00 AM	Business Inventories	-	0.50%	0.70%
16-Apr	10:00 AM	NAHB Housing Market Index	-	29	28
17-Apr	8:30 AM	Housing Starts	-	700K	698K
17-Apr	8:30 AM	Building Permits	-	710K	717K
17-Apr	9:15 AM	Industrial Production	-	0.20%	0.00%
17-Apr	9:15 AM	Capacity Utilization	-	78.50%	78.40%
18-Apr	7:00 AM	MBA Mortgage Index	-	NA	-2.40%
18-Apr	10:30 AM	Crude Inventories	-	NA	2.791M
19-Apr	8:30 AM	Initial Claims	-	375K	380K
19-Apr	8:30 AM	Continuing Claims	-	3275K	3251K
19-Apr	10:00 AM	Existing Home Sales	-	4.62M	4.59M
19-Apr	10:00 AM	Philadelphia Fed	-	10.3	12.5
19-Apr	10:00 AM	Leading Indicators	-	0.20%	0.70%

I will be watching these reports closely for you and let you know if there are any big surprises:
It is virtually impossible for you to keep track of what is going on with the economy and other events that can impact the housing and mortgage markets. Just leave it to me, I monitor the live trading of Mortgage Backed Securities which are the only thing government and conventional mortgage rates are based upon.

Quote of the week:

The biggest challenge that we've had over the past four years is fear — fear that the economy is collapsing, that property values are collapsing, that the world is coming to an end - the Fear Factor is all but gone now.

Mark Prather, a broker at ERA Buy America Real Estate in La Palma, Calif.

Brought to you by:

Quentin Keefe
Loan Officer
Office: 603-669-5626
Cell: 603-321-6730
qkeefe@regencymtg.com

Regency Mortgage Corp.
175 Canal Street
Manchester, NH 03101
NMLS # 8158

www.regencymtg.com

04/10/2012 - Factory Orders Continue to Rebound
by Quentin Keefe

The Housing Market Update

Regency Mortgage Corp.

04/09/2012

Factory Orders Continue Rebound

Businesses ordered more machinery and equipment from U.S. factories in February, a signal that many are investing in their companies despite the expiration of a tax credit.

This is positive news for the housing market as increased demand for manufacturing signals stronger consumer sentiment.

Orders to U.S. factories increased 1.3 percent in February, the Commerce Department said. That offset a similar decline in January.

U.S. factories stepped up hiring and production in March, based on a report Monday from the Institute for Supply Management.

The trade group of purchasing managers said its index of manufacturing activity rose to 53.4 in March, up from a February reading of 52.4. Readings above 50 indicate manufacturing is expanding.

Manufacturing has been a key source of economic growth since the recession ended in June 2009.

What Happened to Rates Last Week?

Mortgage backed securities (MBS) gained +70 basis points from last Friday to the prior Friday which helped mortgage rates to decrease (Mortgage rates have an inverse relationship to mortgage backed security prices).
The highest rates of the week were on Tuesday and the lowest rates of the week were on Friday.
Mortgage rates shot up Tuesday afternoon after the release of the minuets from the last Fed meeting.
As traders deciphered the minutes, it became clear to them that a third round of quantitative easing would not be in the cards. This caused MBS to sell off and forced mortgage rates higher.
But everything changed on Friday.
The MBS market reacted sharply to the disappointing employment data.
The headline Unemployment Rate dropped from 8.3% to 8.2% but traders largely ignore this data as it is the results of a verbal phone survey.
Traders focus instead on the Non-Farm Payroll data which did show that the economy added 120,000 jobs. While job growth is good, this was a big decrease from the prior month where the economy added 240,000 jobs. This disappointing employment news caused traders to speculate that further Fed action may be needed (a complete reversal in thought from Tuesday afternoon) and made MBS attractive again. This new demand for MBS helped to push mortgage rates lower.

What to Watch Out For This Week:

Date	Time	Economic Release	Actual	Cons. Estimate	Prior
10-Apr	10:00 AM	Wholesale Inventories	-	0.50%	0.40%
11-Apr	7:00 AM	MBA Mortgage Index	-	NA	4.80%
11-Apr	8:30 AM	Export Prices ex-ag.	-	NA	0.50%
11-Apr	8:30 AM	Import Prices ex-oil	-	NA	-0.10%
11-Apr	10:30 AM	Crude Inventories	-	NA	9.009M
11-Apr	2:00 PM	Treasury Budget	-	NA	-$188.2B
11-Apr	2:00 PM	Fed's Beige Book	-	-	-
12-Apr	8:30 AM	Initial Claims	-	355K	357K
12-Apr	8:30 AM	Continuing Claims	-	3350K	3338K
12-Apr	8:30 AM	PPI	-	0.30%	0.40%
12-Apr	8:30 AM	Core PPI	-	0.20%	0.20%
12-Apr	8:30 AM	Trade Balance	-	-$52.0B	-$52.6B
13-Apr	8:30 AM	CPI	-	0.30%	0.40%
13-Apr	8:30 AM	Core CPI	-	0.20%	0.10%
13-Apr	9:55 AM	Mich Sentiment	-	76.1	76.2

Quote of the week:

The biggest source of unfinished business in the financial reform effort is in the housing finance area...Fannie Mae and Freddie Mac are "not a source of systemic risk" now

Treasury Secretary Geithner

Brought to you by:

Quentin Keefe
Loan Officer
Office: 603-669-5626
Cell: 603-321-6730
qkeefe@regencymtg.com

Regency Mortgage Corp.
175 Canal Street
Manchester, NH 03101
NMLS # 8158

www.regencymtg.com

04/03/2012 - Bull Market in Bonds Nearing an End?
by Quentin Keefe

The Housing Market Update

Regency Mortgage Corp.

04/02/2012

Bull Market in Bonds Nearing an End?

U.S. consumer confidence rebounded to its highest level in more than a year in March as optimism about jobs and income overcame higher prices at the gasoline pump, said a survey released on Friday.

The Thomson Reuters/University of Michigan's final March reading for the overall consumer sentiment index rose to 76.2, the highest since February 2011, from 75.3 in February.

The final March figure rose from a preliminary reading of 74.3 and was above economists' median forecasts of 74.7.

"Consumer confidence edged upward as more favorable income and job trends offset rising gas prices," survey director Richard Curtin said in a statement.

The barometer of current economic conditions ended at 86.0 in March, also the highest level since February 2011. This improved on the preliminary reading of 84.2 and February's 83.0. Analysts had predicted a reading of 84.5.

This is particulary good news for the housing market as we all know that consumers are more likely to put in an offer on a home if they feel more secure about the economy and their own prospects.

What Happened to Rates Last Week?

Mortgage backed securities (MBS) gained +35 basis points from last Friday to the prior Friday which helped mortgage rates to decrease (Mortgage rates have an inverse relationship to mortgage backed security prices).
The highest rates of the week were on Monday and the lowest rates of the week were on Tuesday.
MBS and other bonds saw an increase in demand amid concerns about Spain's debt and new budget proposal which pushed money into the safe-haven of U.S. bonds.
But we sold off on Friday (causing mortgage rates to rise from their lows during the week) on a much stronger than expected Consumer Sentiment reading.
Both the 5 and 7 year Treasury auctions saw a slight pull-back in demand compared to recent averages.
From a technical perspective, we tested our ceiling of resistance 4 times and sold off each time that we hit the top of the trading channel. This clearly signals the top end of the market (meaning the potential for lower rates are limited).

What to Watch Out For This Week:

Date	Time	Economic Release	Actual	Cons. Estimate	Prior
2-Apr	10:00 AM	ISM Index	-	53	52.4
2-Apr	10:00 AM	Construction Spending	-	0.50%	-0.10%
3-Apr	10:00 AM	Factory Orders	-	1.40%	-1.00%
3-Apr	2:00 PM	FOMC Minutes	-	-	-
3-Apr	2:00 PM	Auto Sales	-	NA	5.5M
3-Apr	2:00 PM	Truck Sales	-	NA	5.9M
4-Apr	7:00 AM	MBA Mortgage Index	-	NA	-2.70%
4-Apr	8:15 AM	ADP Employment Change	-	213K	216K
4-Apr	10:00 AM	ISM Services	-	56.9	57.3
4-Apr	10:30 AM	Crude Inventories	-	NA	7.102M
5-Apr	7:30 AM	Challenger Job Cuts	-	NA	2.00%
5-Apr	8:30 AM	Initial Claims	-	355K	359K
5-Apr	8:30 AM	Continuing Claims	-	3355K	3340K
6-Apr	8:30 AM	Nonfarm Payrolls	-	200K	227K
6-Apr	8:30 AM	Nonfarm Private Payrolls	-	215K	233K
6-Apr	8:30 AM	Unemployment Rate	-	8.30%	8.30%
6-Apr	8:30 AM	Hourly Earnings	-	0.10%	0.10%
6-Apr	8:30 AM	Average Workweek	-	34.5	34.5
6-Apr	3:00 PM	Consumer Credit	-	$14.0B	$17.8B

Quote of the week:

Consumer confidence edged upward as more favorable income and job trends offset rising gas prices

survey director Richard Curtin

Brought to you by:

Quentin Keefe
Loan Officer
Office: 603-669-5626
Cell: 603-321-6730
qkeefe@regencymtg.com

Regency Mortgage Corp.
175 Canal Street
Manchester, NH 03101
NMLS # 8158

www.regencymtg.com

03/26/2012 - Bull Market in Bonds Nearing an End?
by Quentin Keefe

The Housing Market Update

Regency Mortgage Corp.

03/26/2012

Bull Market in Bonds Nearing an End?

After the false starts of 2010 and 2011, the U.S. economy may finally be on the path toward a strong recovery, Lawrence Summers, former Treasury secretary and currently Charles W. Eliot University Professor at Harvard, wrote in an opinion piece in the Financial Times on Monday.

In the springs of 2010 and 2011, many observers who thought they detected evidence that the economy had decisively turned around were disappointed a few months later, Summers wrote.

"Several considerations suggest that this time may be different," he said.

Among them, he listed employment growth that has been running "well ahead" of population growth for some time, a higher U.S. stock market, and the fact that expected market volatility is "lower than at any time since 2007."

He also cited pent-up demand from consumers who have long put off purchases of new cars and other durable goods, and signs that the housing market is beginning to stabilize.

"For years now, the rate of new families setting up households has been well below normal as more and more young people have moved in with their parents," Summers wrote. "At some point they will set out on their own, creating a virtuous circle of a stronger housing markets, more 'family formation' that boosts demand, further improvement in housing conditions and so on."

What Happened to Rates Last Week?

Mortgage backed securities (MBS) gained a very modest +8 basis points from last Friday to the prior Friday which helped mortgage rates to pull back from their highs (Mortgage rates have an inverse relationship to mortgage backed security prices).
We saw our highest mortgage rates of 2012 on Tuesday.
This was primarily due do the continued sell off of Treasuries and mortgage backed securities by banks that were no longer forced to hold them after passing the latest "stress test" by the Fed.
We had a mixed bag of housing data as there was a pickup in Housing Starts and Building Permits but Existing Home Sales came in lighter than market expectations.

What to Watch Out For This Week:

Date	Time	Economic Release	Actual	Cons. Estimate	Prior
26-Mar	10:00 AM	Pending Home Sales	-	0.50%	2.00%
27-Mar	9:00 AM	Case-Shiller 20-city Index	-	-3.80%	-4.00%
27-Mar	10:00 AM	Consumer Confidence	-	70	70.8
28-Mar	7:00 AM	MBA Mortgage Index	-	NA	-7.40%
28-Mar	8:30 AM	Durable Orders	-	2.50%	-3.70%
28-Mar	8:30 AM	Durable Orders -ex Transportation	-	1.00%	-3.00%
28-Mar	10:30 AM	Crude Inventories	-	NA	-1.160M
29-Mar	8:30 AM	Initial Claims	-	350K	348K
29-Mar	8:30 AM	Continuing Claims	-	3385K	3352K
29-Mar	8:30 AM	GDP - Third Estimate	-	3.00%	3.00%
29-Mar	8:30 AM	GDP Deflator - Third Estimate	-	0.90%	0.90%
30-Mar	8:30 AM	Personal Income	-	0.40%	0.30%
30-Mar	8:30 AM	Personal Spending	-	0.60%	0.20%
30-Mar	8:30 AM	PCE Prices - Core	-	0.10%	0.20%
30-Mar	9:45 AM	Chicago PMI	-	62	64
30-Mar	9:55 AM	Michigan Sentiment - Final	-	74.3	74.3

Quote of the week:

For years now, the rate of new families setting up households has been well below normal as more and more young people have moved in with their parents,at some point they will set out on their own, creating a virtuous circle of a stronger housing markets, more 'family formation' that boosts demand, further improvement in housing conditions and so on

Lawrence Summers, former Treasury secretary

Brought to you by:

Quentin Keefe
Loan Officer
Office: 603-669-5626
Cell: 603-321-6730
qkeefe@regencymtg.com

Regency Mortgage Corp.
175 Canal Street
Manchester, NH 03101
NMLS # 8158

www.regencymtg.com

03/19/2012 - Bull Market in Bonds Nearing an End?
by Quentin Keefe

The Housing Market Update

Regency Mortgage Corp.

03/19/2012

Bull Market in Bonds Nearing an End?

Mortgage rates have seen historic lows due to a long-running bull market in bonds. Specifically, mortgage backed securities. Demand has far exceeded supply which has driven down mortgage rates. As demand starts to pull back, mortgage rates will begin to move upward.

Say goodbye to the longest bull market for bonds in history. The market is at a turning point, say portfolio managers—some of whom are running the nation’s largest bond funds. The reason: growing worries about inflation . While it is not a problem right now, there are several strong economic factors that typically lead to higher prices down the road.

Rates are already starting to rise, even without the Fed. This week, Treasuries and Mortgage Backed Securities saw a sharp sell-off, bringing yields—which move opposite to prices—to their highest level since October.

Rising yields, when coupled with inflation, are a double-whammy to the value of bonds.

With job growth comes purchasing power and pricing pressure on businesses and consumers. Yigal Jhirad, portfolio manager for Cohen & Steers, thinks this pressure is already underway.

While significant inflation and higher mortgage rates are still far down the road, it is clear that they are on the horizon. This is actually a good thing for housing. The housing market has always performed better in the "sweet spot" of mortgage rates which is in that 5.50% to 7.00% range.

What Happened to Rates Last Week?

Mortgage backed securities (MBS) lost -93 basis points from last Friday to the prior Friday which pushed mortgage rates significantly higher from the prior week and marks the second straight week of higher mortgage rates.
We have received month after month of positive economic news which would normally pressure mortgage rates upward but due to global instability, mortgage rates have benefitted from strong demand in MBS which have offset the positive economic news.
But bonds started to sell off in a big way last week which pushed mortgage rates higher.
Why? Because banks started to dump their vast holdings of Treasuries and MBS.
Banks had to hold on to capital while they were undergoing the Fed's "stress test". The "stress test" results were released last week and as a result, each bank definitively knew how much excess capital they had.
This meant that they could finally liquidate their holdings of their very low yielding mortgage backed securities....this caused demand for MBS to fall off which pushed mortgage rates upward.

What to Watch Out For This Week:

Date	Time	Economic Release	Actual	Cons. Estimate	Prior
19-Mar	10:00 AM	NAHB Housing Index	-	31	29
20-Mar	8:30 AM	Housing Starts	-	705K	699K
20-Mar	8:30 AM	Building Permits	-	695K	676K
21-Mar	7:00 AM	MBA Mortgage Index	-	NA	-2.40%
21-Mar	10:00 AM	Existing Home Sales	-	4.61M	4.57M
21-Mar	10:30 AM	Crude Inventories	-	NA	1.750M
22-Mar	8:30 AM	Initial Claims	-	355K	351K
22-Mar	8:30 AM	Continuing Claims	-	3363K	3343K
22-Mar	10:00 AM	FHFA Housing Price Index	-	NA	0.70%
22-Mar	10:00 AM	Leading Indicators	-	0.60%	0.40%
23-Mar	10:00 AM	New Home Sales	-	321K	321K

Quote of the week:

Inflation will be higher than they (Federal Reserve policy makers) think

Mark Zandi, Moody’s Analytics chief economist

Brought to you by:

Quentin Keefe
Loan Officer
Office: 603-669-5626
Cell: 603-321-6730
qkeefe@regencymtg.com

Regency Mortgage Corp.
175 Canal Street
Manchester, NH 03101
NMLS # 8158

www.regencymtg.com

03/14/2012 - Today's Economic News
by Lance Winter, First Place Bank

Interest rates are hitting a four month high this morning, breaking many technical support levels. The 10 yr and MBSs were hit hard yesterday and so far this morning another spike in rates. For four months the 10 yr traded quietly in essentially a 15 basis point yield range with a few forays out of the range that lasted just a day or so. We noted for weeks that although the range was holding the momentum oscillators were weakening; the relative strength index was slightly negative since the first of February. Nothing was changing however; the situation in Europe with Greece’s debt kept a bid in US treasuries, the Fed’s constant comments that the US economy wasn’t on solid footing, and that the Fed would keep the FF rate at zero to +0.25% thru 2014 kept long rates in check. Much of the rationale for low rates is still there but has lessened. Putting it in perspective, as we have constantly commented, interest rates are at 50 yr lows and were unlikely to decline much regardless of the momentary circumstances.

Yesterday the dam broke, traders have been nervous about being long bonds but held on until the 10 blew through its first key support at 2.05%, the level that had previously stopped selling. Yesterday the trigger that started the run was two-fold; Feb retail sales were stronger than thought then in the afternoon the FOC policy statement was the preverbal straw. There was a growing thought that the Fed would launch another easing move to increase buying of treasuries and MBSs; the FOMC said no, not yet. The economic outlook according to the Fed had improved somewhat from the previous FOMC meeting. The stock market has continued to increase taking another support from the bond market. Meanwhile in Europe there are still huge debt issues but at the same time (at least at the moment) that its economy while in recession may not be as serious as markets had believed.

While the increase in rates in the past 24 hours has been swift, we continue to believe rates will not increase too much. How high is questionable but I don’t see them higher than 2.25% (10yr) on the 10 yr note on this move. Will rates fall back to under 2.00% on the 10 yr? Not likely as long as Europe doesn’t completely implode, and that isn’t expected. The Fed is committed to keeping rates low; it’s the definition that is in question. The bond market is capitulating, the exodus has been rapid however once positions are re-balanced the bond and mortgage markets will begin another trading range but at higher levels.

Q4 current account balance this morning was higher than expected at -$124.11B; generally ignored by traders. Feb import prices +0.4%, +5.5% yr/yr; export prices +0.4%, +1.5% yr/yr. also pushed in the background.

This afternoon Treasury will auction $13B of 30 yr bonds, re-opening the 30 yr bond issued last month; should go well given the spike in rates. If the auction isn’t strong it would suggest investors expect more increase in rates.

Gold is falling hard this morning, down over $44.00. Crude a little lower as Saudi Arabian Oil Minister Ali al-Naimi said the kingdom can make up for any shortage in global supply, easing concern that tensions with Iran may disrupt production. Pulling in the other direction, the improvement in the economic outlook.

The volume of purchase applications for home mortgages rose 4.4% in the March 9 week with the four-week average up 2.9%. These gains hint at underlying monthly strength for home sales though the report warns that purchase activity remains subdued and is holding in a narrow range. The rush for refinancing appears to be slowing with the index down 4.1% in the week, hitting the lowest level since the beginning of the year and down for a fourth straight week. But, in what the report believes is an indication that lenders are reaching out to underwater borrowers, the share of HARP loans (Home Affordable Refinance Program) continues to rise. Rates during the week were little changed with 30-year fixed mortgages for conforming balances ($417,500 or less) unchanged at 4.06 percent. Next data out of the housing sector will be Monday with the home builders' housing market index which has been on a marked improvement.

03/12/2012 - Employment Picture Continues to Improve
by Quentin Keefe

Regency Mortgage Corp.

03/12/2012

Employment Picture Continues to Improve:

The U.S. economy scored its third straight month of more than 200,000 jobs created with 227,000 in February as measured by the Non Farm Payroll data. It is widely believed by economists that the economy needs to add at least 150,000 jobs each month in order to continue our growth out of the last recession.

The Unemployment Rate was unchanged at 8.3% from the prior month, however that rate is based upon a phone survey and economists put much greater value and weight on the Non Farm Payroll data which is based upon real data and statistics.

This three month positive trend in job creation is very important for housing as this trend comes at the perfect time before the busy home buying season. Obviously, consumers that feel better about their job security or have recently returned to work will help to bolster demand for housing.

What Happened to Rates Last Week?

Mortgage backed securities (MBS) lost -24 basis points from last Friday to the prior Friday which pushed mortgage rates higher from the prior week.
We saw our highest mortgage rates on Friday morning.
This was the result of a powerful one-two punch:
Bonds sold off on the stronger than expected Non-Farm Payroll data.The prior month's data was also revised upward which painted a much better jobs picture in the United States.
Next was the news that Greece was able to get enough of their private bond holders to agree to their bond swap. This was key, if they didn't agree to the bond swap Greece would have defaulted and caused a massive event in Europe.
Rates have been artificially too low for some time due to concerns over a Greek default, so we lost some of our low rates when they didn't default.
100 day moving average to the rescue: Look at the above chart. The last three times that MBS sold off and touched our 100 day moving average (blue line) we saw a nice bounce upward which helped to move mortgage rates off of our highest levels.

What to Watch Out For This Week:

Date	Time	Economic Release	Actual	Cons. Estimate	Prior
12-Mar	2:00 PM	Treasury Budget	-	-$229.0B	-$222.5B
13-Mar	8:30 AM	Retail Sales	-	1.00%	0.40%
13-Mar	8:30 AM	Retail Sales ex-auto	-	0.70%	0.70%
13-Mar	10:00 AM	Business Inventories	-	0.60%	0.40%
13-Mar	2:15 PM	FOMC Rate Decision	-	0.25%	0.25%
14-Mar	7:00 AM	MBA Mortgage Index	-	NA	-1.20%
14-Mar	8:30 AM	Current Account Balance	-	-$113.8B	-$110.3B
14-Mar	8:30 AM	Export Prices ex-ag.	-	NA	0.00%
14-Mar	8:30 AM	Import Prices ex-oil	-	NA	0.10%
14-Mar	10:30 AM	Crude Inventories	-	NA	0.832M
15-Mar	8:30 AM	Initial Claims	-	358K	362K
15-Mar	8:30 AM	Continuing Claims	-	3415K	3416K
15-Mar	8:30 AM	Empire Manufacturing	-	15	19.5
15-Mar	8:30 AM	PPI	-	0.50%	0.10%
15-Mar	8:30 AM	Core PPI	-	0.20%	0.40%
15-Mar	9:00 AM	Net Long-Term TIC Flows	-	NA	$17.9B
15-Mar	10:00 AM	Philadelphia Fed	-	12.5	10.2
16-Mar	8:30 AM	CPI	-	0.40%	0.20%
16-Mar	8:30 AM	Core CPI	-	0.20%	0.20%
16-Mar	9:15 AM	Industrial Production	-	0.50%	0.00%
16-Mar	9:15 AM	Capacity Utilization	-	78.80%	78.50%
16-Mar	9:55 AM	Mich Sentiment	-	76	75.3

Quote of the week:

This is a new trend that is developing within the labor market — things are improving, the numbers are certainly far away from what we need to get unemployment down or to suggest that growth is going to be 3.5 or 4 percent. I don't expect that to happen anytime soon. But I do expect the trend to continue.

Peter Cardillo, chief market economist at Rockwell Global Capital in New York

Brought to you by:

Quentin Keefe
Loan Officer
Office: 603-669-5626
Cell: 603-321-6730
qkeefe@regencymtg.com

Regency Mortgage Corp.
175 Canal Street
Manchester, NH 03101
NMLS # 8158

www.regencymtg.com

03/05/2012 - Pending Home Sales Rise to Near Two-Year High
by Quentin Keefe

Regency Mortgage Corp.

03/05/2012

Pending Home Sales Rise to Near Two-Year High:

Signed contracts for U.S. home resales rose to a nearly two-year high in January, further evidence of a budding recovery in the housing market.

The National Association of Realtors said its Pending Home Sales Index, based on contracts signed in January, increased 2 percent to 97.0 — the highest reading since April 2010. Contracts signed were up 8.0 percent in the 12 months to January.

A nascent recovery is under way in the housing market, with the supply of both new and previously owned homes on the market being whittled down in recent months.

What Happened to Rates Last Week?

Mortgage backed securities (MBS) moved sideways from last Friday to the prior Friday to close unchanged from the prior week.
The market saw the lowest mortgage rates on Monday and the highest mortgage rates on Thursday.
MBS had a big sell off (which caused mortgage rates to rise) on a couple of key factors:
We had much better than expected economic news with the Case-Shiller Home Price Index falling much less than market forecasts.
Pending Home Sales, Consumer Confidence and the Chicago Purchasing Manager's Index were all much better than market expectations.
The Fed's Plosser stated that in his opinion, the Fed may have to increase their Fed funds rate sooner than the 2014 forecast.
Ben Bernanke testified before the Congress and Senate and in both cases did not mention a pressing need for another round of stimulus which also helped to pressure MBS.
But MBS climbed off of their worst levels on Friday in the absence of any economic data.

What to Watch Out For This Week:

Date	Time	Economic Release	Actual	Cons. Estimate	Prior
5-Mar	10:00 AM	Factory Orders	-	-1.90%	1.10%
5-Mar	10:00 AM	ISM Services	-	56	56.8
7-Mar	7:00 AM	MBA Mortgage Index	-	NA	-0.30%
7-Mar	8:15 AM	ADP Employment Change	-	220K	170K
7-Mar	8:30 AM	Productivity-Rev.	-	0.90%	0.70%
7-Mar	8:30 AM	Unit Labor Costs - Rev	-	1.10%	1.20%
7-Mar	10:30 AM	Crude Inventories	-	NA	4.160M
7-Mar	3:00 PM	Consumer Credit	-	$13.4B	$19.3B
8-Mar	7:30 AM	Challenger Job Cuts	-	NA	38.90%
8-Mar	8:30 AM	Initial Claims	-	355K	351K
8-Mar	8:30 AM	Continuing Claims	-	3405K	3402K
9-Mar	8:30 AM	Nonfarm Payrolls	-	207K	243K
9-Mar	8:30 AM	Nonfarm Private Payrolls	-	220K	257K
9-Mar	8:30 AM	Unemployment Rate	-	8.30%	8.30%
9-Mar	8:30 AM	Hourly Earnings	-	0.20%	0.20%
9-Mar	8:30 AM	Average Workweek	-	34.5	34.5
9-Mar	8:30 AM	Trade Balance	-	-$48.1B	-$48.8B
9-Mar	10:00 AM	Wholesale Inventories	-	0.60%	1.00%

Quote of the week:

Stability in home prices will likely persuade more potential buyers that it is now worth getting into the market

Ian Shepherdson, chief U.S. economist at High Frequency Economics

Brought to you by:

Quentin Keefe
Loan Officer
Office: 603-669-5626
Cell: 603-321-6730
qkeefe@regencymtg.com

Regency Mortgage Corp.
175 Canal Street
Manchester, NH 03101
NMLS # 8158

www.regencymtg.com

03/02/2012 - Today's Economic News
by Lance Winter, First Place Bank

Treasuries and mortgage markets opened a little better this morning after three days of selling taking the 10 yr to 2.03% yesterday. Stock indexes opening a little weaker. There are no economic releases to deal with today, likely the markets will trade quietly into the weekend.

European leaders met in yet another summit in Brussels declaring a “turning point” after confirming the second bailout for Greece (the 17^th summit meeting in the last two years). Leaders signed the deficit control treaty while Europe’s economy is still in recession mode; “We’re not out of the economic crisis yet but we are turning the page of the financial crisis,” French President Nicolas Sarkozy said. “It’s a reassuring picture which is still very fragile because we have a lot of uncertainty and the countries of Europe have to persevere,” ECB President Mario Draghi said at the summit. “It’s a much much better picture than we had until November.” German Chancellor Angela Merkel apparently changed her mind at the summit, agreeing to speed the payments into the planned 500 billion-euro permanent rescue fund barely a year after she won a deal to slow them down. “We are still in a fragile situation,” Merkel said. ‘This situation has calmed down a bit, but the crisis is hardly over and further steps will be required to get there.’’ And the beat goes on.

Crude oil markets were subject to another rumor yesterday, sending crude prices higher on reports apparently out of Iran’s media that a pipeline explosion occurred in Saudi Arabia. The rumor spiked prices but was totally denied by the Saudi officials. This morning crude oil is down about a dollar after the explosion was seen as a ruse by Iran; there was a fire at a refinery in the area but did didn’t cause any serious damage to the refinery or a pipeline. That crude hasn’t fallen much from the rumor reminds that the situation with Iran’s nuke program is escalating. The Obama administration is escalating warnings that the U.S. may join Israel in an attack on the nuclear facilities if Iran doesn’t dispel concern that its atomic-research program is aimed at producing weapons. Air Force Chief of Staff General Norton Schwartz told reporters this week that the Joint Chiefs of Staff have prepared military options.

At 9:30 the DJIA opened down 7 points, the 10 yr note +6/32 at 2.01% -2 bp and MBS prices +4/32 (.12 bp).

In the absence of any direct data today Tim Geithner’s op-ed piece in the WSJ is worth perusing. The point of the piece is that Wall Street continues to fight the number of new regulations forced on it after the financial disaster the Street and large _banks foisted on America that set up the worst recession since the depression. ……” In the spring of 2008, more Americans were starting to face higher mortgage payments as teaser interest rates reset and they could no longer refinance out of them because the value of their homes stopped rising—the leading edge of a wave of foreclosures and a terrible fall in house prices. By the time Bear Stearns failed, the recession was then already several months old, but it would of course get much worse in coming months. These problems were partly the result of amnesia. There was no memory of extreme crisis, no memory of what can happen when a nation allows huge amounts of risk to build up outside of the safeguards all economies require.”…… To read the piece online, visit this link.

Yesterday the 10 yr note rose to 2.06% before closing the day at 2.03%; it hit its near term support and held, just as when it falls to its resistance at 1.90%. The 10 and mortgage rates are well contained in their respective ranges, it’s been that way for months and likely to continue. At 10:00 the 10 yr is back under 2.00% at 1.99% on weaker stock indexes. MBS prices already better than where prices traded when lenders priced this morning. The rest of the day should trade quietly with no driving news.

03/01/2012 - Today's Economic News
by Lance Winter, First Place Bank

Prior to 8:30 economic releases the US bond and mortgage markets were under selling pressure; the 10 yr note yield at 2.04% +6 bp frm yesterday’s close and MBS prices down 12/32 (.37 bp) frm the close yesterday. Stock indexes were trading a little higher but not much.

At 8:30 weekly jobless claims were about unchanged from last week, -2K to 351K, the previous week claims were revised slightly, down 2K from 355K to 353K. Claims continue to reflect that employers, while still not hiring are not firing and cutting jobs. Jan personal income expected to be up 0.4% increased 0.3%; personal spending expected up 0.4% was up just 0.2%. The reaction to the data wasn’t much but treasuries early this morning were in wholesale selling mode on continuing improvement on Europe’s debt problems. The 10 yr shot up to 2.05% (+7 bp) and MBS prices at 9:00 -11/32 (.34 bp).

Comments from Italy’s Prime Minister Mario Monti this morning saying the worst may be over for the euro region’s most distressed bonds. He believes there will be a plan worked out by the end of this month to increase the firewall around the debt crisis in the EU. Meanwhile Germany is continuing to resist an increase in the bailout plans; Germany is saying it isn’t the time to increase the bailout fund. Today begins the EU leaders’ summit in Brussels. Italian bonds are improving, lessening the urgency to increase the firewall according the German government. Yesterday the ECB added more to the kitty than had been expected, adding to the current prevailing view that Europe may actually dodge the bullet. The safety trade into US treasuries is being unwound as investors are less concerned that defaults will occur. All that said, it is still a moving target that can swing from one extreme to another in a blink of an eye.

At 9:30 the DJIA opened +50, the 10 yr -21/32 to 2.05% and MBS prices -11/32 (.34 bp).

Two data points at 10:00; the Feb ISM manufacturing index was thought to be at 54.6 frm 54.1 in Jan, it fell to 52.4. New orders fell to 54.9 frm 57.6 and employment index fell to 53.2 frm 54.3. The initial reaction to the weak ISM data pulled stock indexes down from 60 to 26 and the 10 yr note from -21/32 to -14/32, mortgage prices at 9:30 -11/32 (.34 bp) at 10:05 +8/32 (.25 bp). Jan construction spending was expected up 1.0% as reported it fell to -0.1%, the first decline in construction spending since last July.

Yesterday Ben Bernanke essentially implied the Fed isn’t likely to ease again by purchasing MBSs or treasuries; given the reaction in the rate markets it appeared there were more than a few betting that the Fed would do another QE. No easing and more positive news from Europe are combining to push interest rates higher as traders and investors step away from long bond positions.

Since the beginning of November the bellwether 10 yr has spent 90% of the time in the range between 2.10% and 1.90%, 20 basis points over 4 months. Mortgage rates also in a very narrow range, about 12 basis points in rates. This morning the 10 yr at 2.05% is at the top of the range, we expect the range will continue to hold. If however circumstances push the 10 over 2.10% then the last port in the storm is 2.15%. Although the Fed isn’t going to ease again, it will continue to keep short rates low (Fed funds) and in turn keep the long end and mortgage rates from increasing much.

02/27/2012 - Consumer Sentiment Continues Climb
by Quentin Keefe

Consumer Sentiment Continues Climb:

The willingness to "pull the trigger" on a home purchase has more to do with how a home buyer feels about their own financial stability and their view of the economy than any other factor.

So, it is good news for the housing industry to see the Thomson Reuters/University of Michigan's Consumer Sentiment Index continuing to climb upward from our lows of last summer.

The reading of 75.3 was a slight improvement from the prior month and the highest reading in a year. It also continues the trend of improving consumer sentiment since our lowest readings in August 2011.

A third of consumers spontaneously reported hearing about more job opportunities, the highest proportion ever recorded by the survey. The U.S. jobless rate unexpectedly fell to a three-year low in January, stoking hopes the labor market is healing.

What Happened to Rates Last Week?

Mortgage backed securities (MBS) gained just +7 basis points from last Friday to the prior Friday which moved mortgage rates slightly lower on a week-over-week basis.
We had a rough start to the holiday-shortened week with the highest mortgage rates on Tuesday afternoon in reaction to the approval of the second Greek bailout.
But the market reversed course for the rest of the week which helped to pull mortgage rates back down.
MBS rallied on a very strong 7 year U.S. Treasury auction and amid concerns that the magical Greek bailout package would not be enough to stem the tide of financial weakness in Europe.

What to Watch Out For This Week:

Date	Time	Economic Report	Actual	Cons. Estimate	Prior
27-Feb	10:00 AM	Pending Home Sales	-	1.00%	-3.50%
28-Feb	8:30 AM	Durable Orders	-	-1.40%	3.00%
28-Feb	8:30 AM	Durable Orders -ex Transportation	-	0.20%	2.20%
28-Feb	9:00 AM	Case-Shiller 20-city Index	-	-3.60%	-3.70%
28-Feb	10:00 AM	Consumer Confidence	-	62.5	61.1
29-Feb	7:00 AM	MBA Mortgage Index	-	NA	-4.50%
29-Feb	7:00 AM	MBA Mortgage Purchase Index	-	NA	-4.50%
29-Feb	8:30 AM	GDP - Second Estimate	-	2.80%	2.80%
29-Feb	8:30 AM	GDP Deflator - Second Estimate	-	0.40%	0.40%
29-Feb	9:45 AM	Chicago PMI	-	60	60.2
29-Feb	10:30 AM	Crude Inventories	-	NA	1.633M
29-Feb	2:00 PM	Fed's Beige Book	-	-	-
1-Mar	8:30 AM	Initial Claims	-	355K	351K
1-Mar	8:30 AM	Continuing Claims	-	3425K	3392K
1-Mar	8:30 AM	Personal Income	-	0.40%	0.50%
1-Mar	8:30 AM	Personal Spending	-	0.30%	0.00%
1-Mar	8:30 AM	PCE Prices - Core	-	0.20%	0.20%
1-Mar	10:00 AM	ISM Index	-	54.5	54.1
1-Mar	10:00 AM	Construction Spending	-	1.00%	1.50%
1-Mar	2:00 PM	Auto Sales	-	NA	5.00M
1-Mar	2:00 PM	Truck Sales	-	NA	5.73M

Quote of the week:

consumers expect the pace of overall economic growth to continue to slowly restore lost jobs despite these potential problems

Richard Curtin, survey director - University of Michigan's Consumer Sentiment Index

Brought to you by:

Quentin Keefe
Loan Officer
Office: 603-669-5626
Cell: 603-321-6730
qkeefe@regencymtg.com

Regency Mortgage Corp.
175 Canal Street
Manchester, NH 03101
NMLS # 8158

www.regencymtg.com

02/21/2012 - New Homes Data Shows More Gains
by Quentin Keefe

New Homes Data Shows More Gains:

The Commerce Department said Thursday that builders broke ground on a seasonally adjusted annual rate of 699,000 homes in January. That's up 1.5 percent from December and reached the highest level since December 2008. Construction began work on 508,000 single-family homes last month and December single-family homes were revised up strongly to show builders started 513,000 homes — a 12 percent gain from November.

In a separate report, building permits, a gauge of future construction, rose 0.7 percent. The majority of those permits were for single-family homes. It can take 12 months for a builder to obtain a permit and construct a single-family home.

In a third report released last week, A measure of builder sentiment has risen for five straight months and is now at its highest level in nearly five years. Many builders are seeing more people express interest in buying a home, leading them to believe 2012 could be a turn-around year for the market. Mortgage rates have never been cheaper. And home sales started to rise at the end of last year.

What Happened to Rates Last Week?

Mortgage backed securities (MBS) lost just 7 basis points from last Friday to the prior Friday which moved mortgage rates sideways on a week-over-week basis. But MBS pulled back -65 basis points from our best levels on Wednesday. This means that mortgage rates were much higher on Friday than on Wednesday.
The reason for the big change in direction? Greece is the word.
Mortgage rates are artificially low due in large part to fear and concern about several members of the European Union defaulting. This has lead overseas investors to pour money into the safe-haven of our mortgage-backed-securities and as a result of that increased demand, mortgage rates fell.
MBS sold off (less demand, which equates to higher rates) after the European Central Bank announced that they would hold a "bond swap" for those that own the worthless Greek debt. This was seen as the last step that was needed to get Greece the next round of bailout money.

What to Watch Out For This Week:

Date	Time	Economic Release	Actual	Cons.	Prior
22-Feb	7:00	MBA Mortgage Index		NA	-1.00%
22-Feb	10:00	Existing Home Sales		4.63M	4.61M
23-Feb	8:30	Initial Claims		355K	348K
23-Feb	8:30	Continuing Claims		3450K	3426K
23-Feb	10:00	FHFA Housing Price Index		NA	1.00%
23-Feb	11:00	Crude Inventories		NA	-0.171M
24-Feb	9:55	Michigan Sentiment - Final		73	72.5
24-Feb	10:00	New Home Sales		315K	307K

It is virtually impossible for you to keep track of what is going on with the economy and other events that can impact the housing and mortgage markets. Just leave it to me, I monitor the live trading of Mortgage Backed Securities which are the only thing government and conventional mortgage rates are based upon.

Quote of the week:

The upturn in permits and starts in recent months has been consistent with the surge in the ... survey of homebuilders, which has surprised the markets to the upside for five straight months

Ian Shepherdson, chief U.S. economist at High Frequency Economics

Brought to you by:

Quentin Keefe
Loan Officer
Office: 603-669-5626
Cell: 603-321-6730
qkeefe@regencymtg.com

Regency Mortgage Corp.
175 Canal Street
Manchester, NH 03101
NMLS # 8158

www.regencymtg.com

02/13/2012 - Consumer Sentiment Moves Off Highs
by Quentin Keefe

Consumer Sentiment Moves off of Highs:

Americans turned less optimistic about the economy in early February on worries about falling income even as their outlook on the jobs market rose to a record high, a survey released on Friday showed.

The Thomson Reuters/University of Michigan Index of Consumer Sentiment fell back in February with a preliminary score of 72.5 that is 2.5 pts lower than January's score of 75.

Current conditions, and more precisely a negative tone towards current finances, was the heaviest drag. Even though optimism towards the job market kept up, the CSI was unable to hang on to sentiment expressed last month. Market expectations averaged to 74.5.

The optimism in their job outlook is encouraging though and is certainly reflective of the steady string of better than expected Initial Weekly Jobless Claims and the recent decline in the national Unemployment Rate. As these trends in lower Unemployment continue, look for the Consumer Sentiment to regain some ground.

What Happened to Rates Last Week?

Mortgage backed securities (MBS) lost -26 basis points from last Friday to the prior Friday which moved mortgage rates higher on a week-over-week basis. That also marked a -68 basis point drop in MBS pricing from our all time high on 02/02/12.
Mortgage backed securities (and therefore mortgage rates) moved sideways during the week with only minor movements in reaction to the 10 year and 30 year U.S. Treasury auctions. But MBS did sell off on Friday on news that Greece would come through with another austerity package that would qualify them for additional bailout funds.
The Greek story has been an important one for mortgage rates. Mortgage rates are artificially too low due to increased demand for U.S. bonds as a pure "safety play" against a European financial collapse. A default by Greece would start a "domino effect" of other countries defaults too. So, any positive news that a default is postponed will cause our rates to increase.

What to Watch Out For This Week:

Date	Time	Economic Release
14-Feb	8:30 AM	Retail Sales
14-Feb	8:30 AM	Retail Sales ex-auto
14-Feb	8:30 AM	Export Prices ex-ag.
14-Feb	8:30 AM	Import Prices ex-oil
14-Feb	10:00 AM	Business Inventories
15-Feb	7:00 AM	MBA Mortgage Index
15-Feb	8:30 AM	Empire Manufacturing
15-Feb	9:00 AM	Net Long-Term TIC Flows
15-Feb	9:15 AM	Industrial Production
15-Feb	9:15 AM	Capacity Utilization
15-Feb	10:00 AM	NAHB Housing Market Index
15-Feb	10:30 AM	Crude Inventories
15-Feb	2:00 PM	FOMC Minutes
16-Feb	8:30 AM	Initial Claims
16-Feb	8:30 AM	Continuing Claims
16-Feb	8:30 AM	Housing Starts
16-Feb	8:30 AM	Building Permits
16-Feb	8:30 AM	PPI
16-Feb	8:30 AM	Core PPI
16-Feb	10:00 AM	Philadelphia Fed
17-Feb	8:30 AM	CPI
17-Feb	8:30 AM	Core CPI
17-Feb	10:00 AM	Leading Indicators

Quote of the week:

The new mortgage deal hurts responsible home owners but rewards those that put little down and were late on their payments

Banking Analyst Dick Bove

Brought to you by:

Quentin Keefe
Loan Officer
Office: 603-669-5626
Cell: 603-321-6730
qkeefe@regencymtg.com

Regency Mortgage Corp.
175 Canal Street
Manchester, NH 03101
NMLS # 8158

www.regencymtg.com

02/06/2012 - Housing Market Picture Brightens with Job Gains
by Quentin Keefe

Regency Mortgage Corp.

02/06/2012

Housing Market Picture Brightens with Job Gains:

The pace of job creation surged in January, with the US economy generating 243,000 new positions while the unemployment rate dropped to 8.3 percent, according to government data released Friday.

Both numbers were far better than the consensus estimates, which expected a growth of 150,000 jobs and a steady unemployment rate of 8.5 percent.

Job gains have been concentrated primarily in the service sector, particularly in retail and the food and beverage industries. Warehousing, manufacturing, mining and health care also have participated.

True to form, services were responsible for 162,000 of the January swell, with manufacturing payrolls growing 50,000. Government cuts subtracted 14,000 from the total. Retail has added 390,000 jobs since December 2009, while durable goods manufacturing is up 418,000 over the past two years, according to government figures.

Housing demand is driven primarily by two factors (neither is interest rate): Consumer Sentiment and Employment Stability. So, the surprisingly strong Nonfarm Payroll data is certainly good news for the housing industry.

What Happened to Rates Last Week?

Mortgage backed securities (MBS) gained just +4 basis points from last Friday to the prior Friday which moved mortgage rates sideways on a week-over-week basis.
But the real story was that on Thursday MBS shot up to their highest levels (and therefore lowest mortgage rates) ever as the benchmark Fannie Mae 3.5% coupon traded at its highest level since it has been issued.
But MBS sold off of their highs and had a major reversal on Friday which moved mortgage rates upward from Thursday's level on the much better than expected Unemployment Rate and Nonfarm Payroll data.

What to Watch Out For This Week:

Date	Time	Economic Release	Actual	Cons.	Previous
7-Feb	10:00	IBD/TIPP Economic Optimism (MoM)		48.50	47.50
7-Feb	15:00	Consumer Credit Change		$7.30B	$20.37B
8-Feb	7:00	MBA Mortgage Applications			-2.90%
8-Feb	10:30	EIA Crude Oil Stocks			4175M
9-Feb	8:30	Continuing Jobless Claims			3.437M
9-Feb	8:30	Initial Jobless Claims		371K	367K
9-Feb	10:00	Wholesale Inventories		0.40%	0.10%
10-Feb	8:30	Trade Balance		$-48.20B	$-47.75B
10-Feb	9:55	Reuters/Michigan Consumer Sentiment		74.30	75.00
10-Feb	14:00	Monthly Budget Statement		-65.20B	-85.97B

Quote of the week:

Everything counts in large amounts

Depeche Mode

Brought to you by:

Quentin Keefe
Loan Officer
Office: 603-669-5626
Cell: 603-321-6730
qkeefe@regencymtg.com

Regency Mortgage Corp.
175 Canal Street
Manchester, NH 03101
NMLS # 8158

www.regencymtg.com

12/27/2011 - New Home Sales Continue to Rise
by Quentin Keefe

December 27th, 2011

The Housing Market Update

Regency Mortgage Corp.

Brought to you by:

Quentin Keefe
Loan Officer
Office: 603-669-5626
Cell: 603-321-6730
qkeefe@regencymtg.com

175 Canal Street

Manchester, NH 03101
www.regencymtg.com

NMLS # 8158

New Home Sales Continue To Rise:
Investors cheered yet another U.S. report showing signs of improvement in the housing market.

The Commerce Department report showed US new home sales rose for the third straight month in row, increased by 1.6% to a seasonally adjusted annual rate of 315,000 from October.

Even as the pace of gain was smaller than 2.6% forecast by economists, investors took comfort in that housing data released in recent days have started to show stabilization, and given that the housing market is one of a major contributors to the economy, it could provide some support for the economic growth next year.

New homes account for just a fraction of the housing market, but they have a big impact on the economy. Each new home built creates roughly three jobs for a year and generates about $90,000 in taxes, according to the National Association of Home Builders.

What Happened to Rates Last Week:

Mortgage backed securities (MBS) lost -82 basis points from last Friday to the prior Friday which moved mortgage rates higher.
We had a mixed bag of U.S. economic data. The 3rd quarter GDP number was revised downward from 2.0% to 1.8% but Durable Goods Orders, Initial Jobless Claims and New Home Sales were much better than expected.
We saw strong demand for the U.S. 2 and 5 year Treasury auctions but demand for the 7 year Treasury auction fell sharply which was a negative for mortgage rates.
Traders sold off MBS on the positive economic news and the relatively weak 7 year Treasury auction which pushed mortgage rates higher.

What to Watch Out For This Week:
The following are the major economic reports that will hit the market this week. They each have the ability to affect the pricing of Mortgage Backed Securities and therefore, interest rates for Government and Conventional mortgages. I will be watching these reports closely for you and let you know if there are any big surprises:

Date	Time	Economic Event
25-Dec	19:00	Christmas
27-Dec	9:00	S&P/Case-Shiller Home Price Indices (YoY)
27-Dec	10:00	Consumer Confidence
27-Dec	10:00	Richmond Fed Manufacturing Index
28-Dec	7:00	MBA Mortgage Applications
29-Dec	8:30	Continuing Jobless Claims
29-Dec	8:30	Initial Jobless Claims
29-Dec	9:45	Chicago Purchasing Managers' Index
29-Dec	10:00	Pending Home Sales (MoM)
29-Dec	10:30	EIA Crude Oil Stocks change
30-Dec	14:00	MBS Market Closes Early

12/19/2011 - Job Claims, Factory Data Suggest Recovery Picking Up Steam
by Quentin Keefe

December 19th, 2011

The Housing Market Update

Regency Mortgage Corp.

Brought to you by:

Quentin Keefe
Loan Officer
Office: 603-669-5626
Cell: 603-321-6730
qkeefe@regencymtg.com

175 Canal Street

Manchester, NH 03101
www.regencymtg.com

NMLS # 8158

Job Claims, Factory Data Suggest Recovery Picking Up Steam:
Government reports on weekly jobless claims, manufacturing activity and inflation offered fresh evidence the U.S. economic recovery is picking up steam.

New U.S. claims for unemployment benefits dropped to a 3 1/2 year low last week, a government report showed on Thursday, suggesting the labor market recovery was gaining speed. Initial claims for state unemployment benefits dropped 19,000 to a seasonally adjusted 366,000, the Labor Department said. That was the lowest level since May 2008.

A gauge of manufacturing in New York State showed growth accelerated in December to its highest level since May as new orders improved, the New York Federal Reserve said in a report on Thursday. The survey of manufacturing plants in the state is one of the earliest monthly guideposts to U.S. factory conditions. The gain in December added on to improvement last month that pulled the index out of a five-month contraction.

Wholesale prices rose a modest 0.3 percent last month, as companies paid more for such items as food and pharmaceuticals. But energy prices barely rose, keeping inflation in check.

Most economists say they think inflation has peaked and will slowly decline next year. That's because prices for oil and many agricultural commodities have fallen from their highs this spring. Slower growth in China and a possible recession in Europe have reduced global demand for energy and other goods.

Lower price growth means consumers will have more buying power, potentially boosting consumer spending. The jump in gas and food prices earlier this year limited the ability of consumers to buy other goods, thereby slowing the economy.

Consumer spending rebounded in the July-September quarter as prices eased. The stronger spending helped increase growth to an annual rate of 2 percent from a slight 0.9 percent in the first half of the year. Economists expect consumer spending to rise again in the last three months of this year and think growth could top 3 percent. Federal Reserve policymakers, like many private economists, predict inflation will fall next year. That would give the central bank more latitude to hold down interest rates and potentially take other steps to stimulate the economy.

Tame inflation, improved manufacturing, increased consumer demand and super-low mortgage rates all add up to big positives for the housing market.

What Happened to Rates Last Week:

Mortgage backed securities (MBS) gained +67 basis points from last Friday to the prior Friday which moved mortgage rates lower. Once again, the U.S. saw much better than expected economic data.
Both the N.Y. Empire and Philly Fed manufacturing data saw big increases and the Initial Weekly Jobless Claims fell below 390K. We also saw very tame results in both the Consumer Price Index and the Producer Price Index which point to reduced inflationary pressure.
MBS rallied in the later part of the week on the heels of to very successful U.S. Treasury auctions. Both the 10 and 30 year auctions saw very strong demand which pushed rates lower.
This was due to a growing concern that the recent agreement out of the European Summit would not be enough to stem the tide in Europe. This concern caused investors to snap our bonds even though the interest rates and returns are very low. Foreign investors simply want a place to put their funds, knowing that they will get those funds back.

What to Watch Out For This Week:
The following are the major economic reports that will hit the market this week. They each have the ability to affect the pricing of Mortgage Backed Securities and therefore, interest rates for Government and Conventional mortgages. I will be watching these reports closely for you and let you know if there are any big surprises:

Date	Time	Economic Release
19-Dec	10:00	NAHB Housing Market Index
20-Dec	8:30	Building Permits (MoM)
20-Dec	8:30	Housing Starts (MoM)
21-Dec	7:00	MBA Mortgage Applications
21-Dec	10:00	Existing Home Sales (MoM)
21-Dec	10:00	Existing Home Sales Change
21-Dec	10:30	EIA Crude Oil Stocks change
22-Dec	8:30	Continuing Jobless Claims
22-Dec	8:30	Gross Domestic Product Annualized
22-Dec	8:30	Gross Domestic Purchases Price Index
22-Dec	8:30	Initial Jobless Claims
22-Dec	8:30	Real Personal Consumption Expenditures (QoQ)
22-Dec	9:55	Reuters/Michigan Consumer Sentiment Index
22-Dec	10:00	Housing Price Index (MoM)
22-Dec	10:00	Leading Indicators (MoM)
23-Dec	8:30	Core Personal Consumption Expenditure - Price Index (MoM)
23-Dec	8:30	Core Personal Consumption Expenditure - Prices Index (YoY)
23-Dec	8:30	Durable Goods Orders
23-Dec	8:30	Durable Goods Orders ex Transportation
23-Dec	8:30	Personal Consumption Expenditure - Price Index (YoY)
23-Dec	8:30	Personal Consumption Expenditures (MoM)
23-Dec	8:30	Personal Income (MoM)
23-Dec	10:00	New Home Sales
23-Dec	10:00	New Home Sales (MoM)

12/19/2011 - Feds Sue GSE's
by Quentin Keefe

There is sufficient blame to go around for the collapse of the financial markets, among them surely the GSE's, Fannie Mae and Freddie Mac, who were at the very least asleep at the wheel while those on Wall Street were lieing to the world about the quality of US mortgage investments. But, for the US Justice Department to single out the CEOs of the two big GSEs is absurd. Why not the former CEO of Countrywide. Angelo Mizilo? How about the CEOs of Goldman Sachs, Washington Mutual...the list goes on! Instead the government chose the easy road, to sue itself. This way they won't upset any on their well heeled friends on Wall Street during an election cycle! Absurd.

12/12/2011 - Housing Industry Rebound
by Quentin Keefe

Brought to you by:

Quentin Keefe
Loan Officer
Office: 603-669-5626
Cell: 603-321-6730
qkeefe@regencymtg.com

175 Canal Street

Manchester, NH 03101
www.regencymtg.com

NMLS # 8158

Housing Industry Rebound:

After half a decade of withering sales and slumping prices, there are strong and diverse signs that the single-family housing market is poised for a rebound.

In some metropolitan areas, the market has bottomed, with both sales and prices on the rise and foreclosures on the decline.

This contrarian — and largely overlooked — thesis flies in the face of the persistent gloom that has nagged the industry since 2007, when the subprime crisis flared.

Industry analysts and players cite a number of reasons — some traditional (employment), others unique to the post-credit bubble era (foreclosures) — for the long-awaited sea change. An analysis of industry and government data also support the forecast.

“It has become increasingly apparent to us that the pieces for a housing rebound next year are beginning to fall into place,” declared Barclays Capital analyst Stephen Kim in a recent note to investors.

Proponents admit that the nascent rebound could easily be derailed, but stress that after years of government efforts to support sales and prices as well as the volatile impact of foreclosures, the market has regained a measure of normalcy.

“With the exception of really hard-hit markets, the vast majority is ready to turn around,” adds Jerry Howard, president and CEO of the National Association of Home Builders, NAHB. "The Washington, D.C., area is not only ripe for recovery, they need to start building units.”

There’s been little conventional, however, about this housing slump, which is one reason it's had so many false bottoms. Among its many firsts — housing starts fell through 1 million annual units, foreclosures topped 2 million in three consecutive years, and home prices declined on a national basis.

The catalysts to recovery are mostly the same: for potential buyers, residential rents have now risen enough to consider buying; existing-home inventory is the lowest in five years, while that of new homes is at a 40-year low; affordability is at a record high; delinquencies have peaked; consumer confidence is on the rise ; and job growth is accelerating.

For investors, with a continuation of the gold rally in question, real estate is beginning to look like a viable inflation hedge alternative, while rising rents mean greater profits.

Finally, there’s the intangible fatigue with bad news, and a desire to end the negative feedback loop.

“We believe there is sizable housing demand that could be released into the market," says Lawrence Yun, chief economist of the National Association of Realtors, NAR.

The NAR is forecasting existing home sales will rise 5 percent in both 2012 and 2013; prices will edge up 2 percent in each of those two years, then 4 percent in 2014.

The NAHB is forecasting a 5.1-percent increase in new home sales and a 10-percent increase for new home starts in 2012.

Jobs, Jobs, Jobs

A turnaround in the housing market will require continued improvement in the job market.

The economy has created jobs 13 months in a row for a total of almost 1.9 million. Weekly jobless claims have been routinely below the key level of 400,000, and the national jobless rate is down to 8.6 percent.

There are already signs in some markets that an improving employment picture is boosting housing demand and sale prices.

In cities such as Tampa, Fla., South Bend, Ind., Grand Rapids, Mich., Raleigh, N.C., Wichita, Kan., and Green Bay, Wis.., the median sales price of an existing single family home increased 1-2 percent in the third quarter, during which time the jobless rate and/or payrolls growth improved dramatically.

Even in the Cape Coral-Fort Myers, Fla. metropolitan area — considered the epicenter of the foreclosure crisis a few years ago — prices were just 1.4 percent lower in the third quarter than the previous year.

A new index by the NAHB and First American, the Improving Markets Index, IMI, launched in September, tracks housing markets throughout the country that are showing signs of improving economic health. Thirty cities – including San Jose, Pittsburgh, New Orleans and Winston-Salem, N.C. – are showing growth in permits, sales and employment.

In San Diego — where in the last year the jobless rate has fallen from 10.4 percent to 9.7 percent and 24,000 jobs have been added — home inventory is down to two months; in some areas of San Francisco (9.4 vs. 10.3 percent), it is one month.

More broadly, 40 percent of all states showed existing home sale increases on both a quarterly and annual basis in the third quarter, according to National Association of Realtors data. That includes high foreclosure-rate states, such as California, Georgia, Michigan and Utah. All but six states showed double-digit gains year over year.

What Happened to Rates Last Week:

Mortgage backed securities (MBS) lost -20 basis points from last Friday to the prior Friday which moved mortgage rates higher. MBS traded in a very tight range for the week. We received much better than expected economic data which normally pressures mortgage rates. ISM Services, Initial Jobless Claims, Wholesale Inventories and Consumer Sentiment all came in stronger than market expectations.
MBS sold off on Friday (causing rates to increase) after the European Union Summit released details of their new agreement with Eurozone countries. This removed some of the "flight to safety" premium that has kept mortgage rates low.

What to Watch Out For This Week:
The following are the major economic reports that will hit the market this week. They each have the ability to affect the pricing of Mortgage Backed Securities and therefore, interest rates for Government and Conventional mortgages. I will be watching these reports closely for you and let you know if there are any big surprises:

Date	Time	Economic Release
12-Dec	14:00	Monthly Budget Statement
13-Dec	8:30	Retail Sales (MoM)
13-Dec	8:30	Retail Sales ex Autos (MoM)
13-Dec	10:00	Business Inventories
13-Dec	10:00	IBD/TIPP Economic Optimism (MoM)
13-Dec	14:15	Fed Interest Rate Decision
14-Dec	7:00	MBA Mortgage Applications
14-Dec	8:30	Import Price Index (MoM)
14-Dec	8:30	Import Price Index (YoY)
14-Dec	10:30	EIA Crude Oil Stocks change
15-Dec	8:30	Continuing Jobless Claims
15-Dec	8:30	Current Account
15-Dec	8:30	Initial Jobless Claims
15-Dec	8:30	NY Empire State Manufacturing Index
15-Dec	8:30	Producer Price Index (MoM)
15-Dec	8:30	Producer Price Index (YoY)
15-Dec	8:30	Producer Price Index ex Food & Energy (MoM)
15-Dec	8:30	Producer Price Index ex Food & Energy (YoY)
15-Dec	9:00	Net Long-Term TIC Flows
15-Dec	9:00	Total Net TIC Flows
15-Dec	9:15	Capacity Utilization
15-Dec	9:15	Industrial Production (MoM)
15-Dec	10:00	Philadelphia Fed Manufacturing Survey
16-Dec	8:30	Consumer Price Index (MoM)
16-Dec	8:30	Consumer Price Index (YoY)
16-Dec	8:30	Consumer Price Index Ex Food & Energy (MoM)
16-Dec	8:30	Consumer Price Index Ex Food & Energy (YoY)

12/06/2011 - Pending Home Sales pop
by Quentin Keefe

December 5th, 2011

The Housing Market Update

Regency Mortgage Corp.

Brought to you by:

Quentin Keefe
Loan Officer
Office: 603-669-5626
Cell: 603-321-6730
qkeefe@regencymtg.com

175 Canal Street

Manchester, NH 03101
www.regencymtg.com

NMLS # 8158

Pending Home Sales Pop:

Potential home buyers came out of the woodwork in October, signing contracts to buy existing homes at a higher-than expected pace.

Pending home sales jumped 10.4 percent compared to September, according to the National Association of Realtors, with the biggest gains in the Midwest, up 24 percent. The Northeast also saw sizeable gains, as did the South. Only out West did buyers stay on the sidelines, with pending home sales there basically flat month to month.

“Home sales have been plodding along at a sub-par level while interest rates are hovering at record lows, and there is a pent-up demand from buyers who normally would have entered the market in recent years," said Realtor chief economist Lawrence Yun. "We hope this is indicates more buyers are taking advantage of the excellent affordability conditions.”

This data continues the string of positive housing data with New Home Sales up 1.3% on a monthly basis and Existing Home Sales up 13.5% on a yearly basis.

What Happened to Rates Last Week:

Mortgage backed securities (MBS) gained +58 basis points from last Friday to the prior Friday which moved mortgage rates lower. MBS traded in a very tight range for the week. We received much better than expected economic data which normally pressures mortgage rates. Pending Home Sales, Manufacturing, Vehicle Sales, and Unemployment data all surpassed the market expectations and put to bed the concept of a "double-dip" recession for the United States. MBS made all of their weekly gains on Friday afternoon. This gave consumers the best mortgage rates of the week. This was the result of continued concern over the European debt crisis and traders seeking to park their money in the safety of U.S. bonds over the weekend.

What to Watch Out For This Week:
The following are the major economic reports that will hit the market this week. They each have the ability to affect the pricing of Mortgage Backed Securities and therefore, interest rates for Government and Conventional mortgages. I will be watching these reports closely for you and let you know if there are any big surprises:

Date	Time	Event
5-Dec	10:00	Factory Orders
5-Dec	10:00	ISM Non-Manufacturing
6-Dec	10:00	IBD/TIPP Economic Optimism (MoM)
7-Dec	7:00	MBA Mortgage Applications
7-Dec	10:30	EIA Crude Oil Stocks change
7-Dec	15:00	Consumer Credit Change
8-Dec	8:30	Continuing Jobless Claims
8-Dec	8:30	Initial Jobless Claims
8-Dec	10:00	Wholesale Inventories
9-Dec	8:30	Trade Balance
9-Dec	9:55	Reuters/Michigan Consumer Sentiment Index

12/06/2011 - Housing Prices are Finally Nearing a Bottom - But Don't Look for a rapid Recovery
by Henry Blodgett

House Prices Are Finally Nearing A Bottom – But Don’t Look For A Rapid Recovery

By Henry Blodget | Daily Ticker – 21 hours ago

Video Player Controls

Since the beginning of the house-price crash in 2007, analyst after analyst has predicted that "the bottom" in house prices is just around the corner - only to be wrong every time.

But now, finally, it looks as though house prices may actually be nearing a bottom.

Why?

Because, after falling nearly 35% from their 2007 peak, nationwide house prices are finally approaching "normal" levels on two key valuation measures: The "price-to-rent ratio," which measures house prices relative to what the houses might rent for, and the "price-to-income ratio," which measures house prices relative to average incomes.

Using the first ratio, economists at Goldman Sachs have concluded that national house prices will decline another 2.5% in 2012 and then bottom over the course of the following year.

(To see a recent chart of the national price-to-rent and other ratios, please click here.)

House prices differ markedly depending on where you live, of course, and Goldman's analysts have considerably different predictions for different markets. Prices in New York, Portland and Atlanta, Goldman predicts, will still see significant declines. While prices in Detroit, Miami and Cleveland should rise.

Importantly, after a price bubble similar to the one the U.S. just experienced, prices often don't stop at "average" levels on the way down. On the contrary, they often plunge straight through "fair value" and spend years below average levels. And that certainly could happen to house prices this time around.

But Goldman's economists believe house prices will level out in a year or two. And unlike other analysts who have made similar predictions in prior years, Goldman's economists actually have data on their side: The price-to-rent ratio really has fallen to normal levels.

Of course, even if house prices do bottom in 2013, that doesn't mean that they'll quickly shoot up again - or that housing will once again be the "great investment" that everyone thought it was back in the boom years.

One of the reasons house prices are expected to bottom soon is that houses are currently more affordable than they have been in the past. But housing "affordability" is judged, in large part, on mortgage rates, and mortgage rates are currently near an all-time low. If and when the economy begins to recover in earnest, mortgage rates will likely rise, and, as they do, houses will become less affordable.

So it is likely that, even after they bottom, U.S. house prices will face headwinds for a long time.

11/11/2011 - New Branch Offices
by Quentin Keefe

Regency Mortgage Corp. President Quentin Keefe announced this week the opening of two new branch offices. A new office at 94 Commercial Street in Portland, ME will be managed by John Farrell. John is joined by Tracy DeMatteis. John and Tracy are up and running and are seeking to hire new Loan Originators for their beautiful Old Port office. Similarly, Bob Ricard and Jeff Auten have opened a new branch office at 400 Amherst Street in Nashua, NH. Bob and Jeff are looking to hire new Loan Originators to cover southern NH as well as northern MA. Both of these offices will have on-site underwriting.

11/11/2011 - Unfair Business Practices
by Quentin Keefe

The mortgage industry has never been more difficult. While the big, national banks and the GSE's continue to suffer from losses sustained by their very own reckless behavior, they nonetheless refuse to take responsibility. Instead, they are sending defaulted loans back to the originating lender demanding a repurchase. Even though most of the defaults can be directly attributed to risky mortgage products that these very same banks once hailed as solid, responsible lending practices. The local originating mortgage lenders are small businesses that have no recourse againt these big, powerful banks, hence many are being forced out of business due to their inability to handle loan repurchases. This practice is unprecedented and un-American, yet it continues. Congress must act to stop this unfair business practice.

09/07/2011 - MBS Authority Market Code Chart
by Quentin Keefe

08/26/2011 - Soldier Ride tomorrow
by Quentin Keefe

We are excited to be joining my son, Devin, along with some of his friends in tomorrow's Soldier Ride to benefit the Wounded Warrior Project. The Regency Riders, as we are called, will be at the starting line in Concord, MA at 9:00 AM, 15 people strong! Thanks to everyone for your support and donations. Wish us luck!

07/08/2011 - Jobs Fall Short
by Lance Winter, First Place Bank

Jobs Fall Short

The main focus this week was the June Employment report. Rising expectations during the week pushed mortgage rates higher ahead of the report. When the Employment data came in far below expectations, though, mortgage rates improved significantly and ended the week a little lower.

Against a consensus forecast of 125K, the economy added just 18K jobs in June, the lowest level since September 2010, and the figures from the prior two months were revised lower by 44K. The Unemployment Rate rose to 9.2% from 9.1% in May. Average Hourly Earnings, a proxy for wage growth, were unchanged from May, below the consensus for a rise of 0.2%. In short, bright spots were hard to find.

Following a series of stronger than expected economic reports in recent weeks, the Employment report was certainly a surprise. The question for investors is how much weight to place on this report in determining the economic outlook. Does this mean that the economy is recovering more slowly than previously thought? Or is it that the jobs data simply operates with a small lag? There is little doubt that the US economy slowed during the first half of the year, primarily due to rising oil prices and the Japanese earthquakes. The impact of these obstacles was expected to be temporary, and nearly all the economic data in recent weeks appeared to support this. This Employment report will certainly make investors more cautious about the pace of future economic growth, but they will not overlook the wide range of other data which suggests that growth is accelerating. With mortgage rates at such low levels, solid evidence of a sustained deterioration in growth likely will be needed for rates to move much lower.

07/01/2011 - Stocks Up, Rates Up
by Lance Winter, First Place Bank

Stocks Up, Rates Up

This week's economic news was nearly all positive, and the stock market posted a strong rally. Unfortunately, what's good for stocks is generally unfavorable for mortgage rates. Progress on the Greek aid package and stronger than expected US manufacturing data, along with the end of the Fed's bond buying program, combined to push mortgage rates higher this week.

While the Fed made known months ago that its $600 billion quantitative easing program would end on June 30, investors have been uncertain what the impact would be. Since the program started, Fed purchases have accounted for roughly 85% of the total new Treasury issuance. The loss of this significant source of demand makes investors less willing to purchase Treasury securities, and mortgage-backed securities (MBS), at what have been historically low yields. Yields had to rise to attract investors.

Part of the improvement in mortgage rates in recent weeks was due to the economic troubles in Greece. Investors shifted to relatively safer investments such as US government guaranteed bonds, including MBS. This week, however, an aid package for Greece took a major step forward. Despite widespread strikes and demonstrations, the Greek government voted to adopt the new austerity measures required for Greece to receive the aid. With the successful vote, the short-term uncertainty decreased, and investors reversed the flight to safety, selling bonds and buying stocks.

07/01/2011 - More Money for Struggling Homeowners
by AnnaMaria Andriotis, SmartMoney on-line

More Money for Struggling Homeowners

by AnnaMaria Andriotis
Wednesday, June 29, 2011

provided by

A new federal program is offering aid with a sweet kicker: It doesn't need to be repaid.

For the roughly four million homeowners who have fallen behind on their mortgage payments, the federal government is offering yet another remedy: free money to catch up on their loans.

The effort, called the Emergency Homeowners Loan Program, is the latest in the federal government's efforts to slow down the flood of foreclosures a necessary step to a meaningful recovery in the housing market, says a Department of Housing and Urban Development official. For people who have lost their jobs, the $1 billion program offers loans of up to $50,000 that don't actually need to be repaid, if applicants meet certain requirements.

The goal, says HUD, is to offer short-term aid to people who look like they'll be back on their feet soon. But critics say the loans may leave homeowners worse off in the long run. "This is a short run band-aid, a modest attempt to grapple with the severity of the situation," says Stuart Gabriel, director of the Ziman Center for Real Estate at the University of California, Los Angeles.

Rolled out by HUD and the nonprofit housing advocacy group NeighborWorks America, the program is making loans with far better terms than anything on offer at a local bank. The loans are interest-free. Payments go directly to the lender for a portion of the borrower's monthly mortgage, including missed payments or past due charges. And when the assistance period -- which runs for up to two years -- ends, 20% of the loan is forgiven with each passing year. In other words, for qualified borrowers who stay in their home for at least five years after the assistance period and who don't fall behind on their mortgage again, this money doesn't have to be paid back.

But some critics say that's where help for consumers ends. By taking this loan, borrowers risk falling further into debt. If they sell their home before the entire loan is forgiven, they'll be on the hook for the remaining amount. The same holds true if they fall behind on their mortgage payments again: they'll need to repay the remaining balance of the loan when they sell or refinance their home. Separately, borrowers aren't required to have equity in their home to receive this money, so someone who has to repay this loan risks owing more on the home later than they do now. For homeowners who are significantly underwater now, the loan may only delay foreclosure, says Gabriel. While the limit each person will get is up to $50,000, loans will average about $35,000 per person, according to NeighborWorks America.

Others say the program doesn't go far enough. The loans will be made available to around 30,000 applicants -- "a drop in the bucket," says Stu Feldstein, president at SMR Research, a housing and mortgage research firm. It's helpful, he says, but it won't be enough to seriously boost the ailing housing market. Roughly 4 to 4.5 million borrowers are behind on their mortgages by at least 90 days or are in foreclosure, accounting for roughly 8% of all mortgages. Housing analysts say the loss of income is the primary reason why borrowers are in danger of losing their homes. Those behind the program counter that the help will be significant for some. "If you are one of those 30,000 people, I think you should be very excited to get this help," says a NeighborWorks America spokesman.

The program started last week and will take applications through July 22. Many experts say it's still too early to say it will be successful, and so far federal assistance programs haven't impacted a significant number of borrowers. The government's Home Affordable Modification Program, which started in 2009 and was projected to help up to 4 million homeowners lower their mortgage payments has so far only permanently helped around 700,000 homeowners. To be eligible, homeowners must have lost income and be at risk of foreclosure due to involuntary job loss, underemployment or a medical or other economic condition; details on the application process are available online through NeighborWorks America.

06/27/2011 - Home Sales Better Than Expected
by Quentin Keefe

Home Sales Better Than Expected:
Average New Home Price Also Increases, Inventory Decreases.

Sales of new U.S. single family homes fell for the first time in three months in May, but inventories of new homes for sale reached record lows and the median sales price rose slightly, a government report showed on Thursday.

The Commerce Department said May new home sales fell 2.1 percent to a seasonally adjusted annual rate of 319,000. Analysts polled by Reuters were expecting a slightly slower pace of 310,000 for the month.

May's new home sales were 13.5 percent above the May 2010 level.

The Commerce Department report showed that the median new home sales price rose to $222,600 in May from $217,000 in April, marking the first increase since December last year.

U.S. housing starts rose more than expected and permits for future construction touched a five month high in May, a government report showed on Thursday.

The Commerce Department said housing starts rose 3.5 percent to a seasonally adjusted annual rate of 560,000 units, retracing almost half of April's steep decline. April's starts were revised up to a 541,000 unit pace, which was previously reported as a 523,000 unit rate.

At May's sales pace, the supply of homes on the market dropped to 6.2 months' worth, the lowest since April 2010.

06/21/2011 - New Construction on the Move
by Quentin Keefe

New Construction On The Move:
Housing Starts increase in May and Building Permits hit a five month high.

U.S. housing starts rose more than expected and permits for future construction touched a five month high in May, a government report showed on Thursday.

The Commerce Department said housing starts rose 3.5 percent to a seasonally adjusted annual rate of 560,000 units, retracing almost half of April's steep decline. April's starts were revised up to a 541,000 unit pace, which was previously reported as a 523,000 unit rate.

Single-family home construction, which accounts for a large portion of the market, rose 3.7 percent.

New building permits unexpectedly rebounded 8.7 percent to a 612,000-unit pace last month, the highest level since December. Economists had expected overall building permits in May to fall to a 558,000-unit pace.

Permits were boosted by a 23.2 percent surge in the multi-family segment. Permits to build single-family homes rose 2.5 percent. New home completions climbed 0.4 percent to 544,000 units in May.

05/20/2011 - Mortgage Rates Little Changed
by Lance Winter

Mortgage Rates Little Changed

Weaker than expected economic data helped mortgage rates decline to the lowest levels of the year early in the week. On Wednesday, though, a reminder that the Fed will eventually sell its portfolio of mortgage-backed securities (MBS) helped to erase the improvement. These two influences offset each other, and mortgage rates ended the week nearly unchanged.

The economic data released this week fell far short of investor expectations almost across the board. The most significant report, April Industrial Production, was unchanged from March, which was well below the consensus forecast. Manufacturing output was hurt by a shortage of parts from Japan due to the earthquakes. The Index of Leading Indicators declined for the first time since June 2010. The housing sector data also showed weakness as Existing Home Sales, Housing Starts, and Building Permits all declined in April.

The FOMC minutes from the April 27 Fed meeting contained few surprises, but they highlighted the fact that the Fed's eventual return to more normal monetary policy will include both asset sales and rate hikes. The minutes gave no indication of the timing of any Fed tightening. Longer term, officials believe that the Fed's balance sheet should contain only Treasury securities, meaning that the Fed at some point will begin to sell its roughly $1 trillion portfolio of MBS. In order to disrupt the mortgage market as little as possible, officials said that the selling may be done over a period of many years, and any asset sales would be announced far in advance.

02/21/2011 - Mortgage Deliquencies Decline
by Quentin Keefe
You would think by the barrage of negative news reports that just about every other home was going into foreclosure. Certainly this is not the case. In fact, the housing market has stabilized in the past six months. The latest report from the Mortgage Bankers Association shows that the percentage of homeowners that were behind at least one monthly payment fell from 9.1% in the third quarter to 8.2% in the fourth quarter. Also, the 2010 delinquency rate fell from over 10% in the beginning of the year to 8.2% at the end of the year.

The 2% drop in mortgage delinquencies follows the recent drop in the Unemployment Rate and the steady increase in Existing Home Sales and Consumer Confidence. These are significant signs that the housing market is closing in on a true market equilibrium.

12/08/2010 - Let Us Do Our Jobs Please
by Quentin Keefe

   It is no secret that things have changed dramatically in the mortgage banking industry. For the most part these changes are positive. During the height of the sub-prime binge, our industry was deluged with hundreds of thousands of new loan originators who entered the business in search of quick, easy money…and they found it. They literally hit our business like a tornado, leaving total devastation in their path. They exited and fast as they entered, as soon as the easy money dried up.
   Now, those of us who treat this business as a profession are left to clean up the mess. Congress has a favorite new target and they just can’t help themselves, turning out new regulation after new regulation placing a stranglehold on our industry that threatens to put thousands of good mortgage brokers and bankers out of business. What they don’t realize is that the bad guys have exited already. Those of us who are left weren’t the problem. Let us do our jobs please.
   The new Loan Originator Compensation rule, part of the Dodd-Frank bill is absurd. It will likely be the death knell for mortgage brokers. Perhaps this is what congress wants, but if so, they are hopelessly misguided. Mortgage brokers, like bankers are now required to be licensed under the SAFE Act. They take the same courses and take the same exams as everyone else. The SAFE Act, along with loan quality initiatives promulgated by Fannie Mae and Freddie Mac, have already addressed loan quality and fraud concerns that resulted from the sub-prime era. Now, congress should allow us to get back to financing the American dream!

10/21/2010 - Community Reinvestment Act changes coming soon
by Quentin Keefe

Expansion of the Community Reinvestment Act (CRA) to include non-depository mortgage banks is edging closer to reality. The House Financial Services Committee, chaired by Rep. Barney Frank, is working on an expansion bill that is said to include non-depository mortgage banks under the CRA. This sweeping reform will expand home financing opportunities to middle-income and moderate-income families throughout the country. Like any reform bill these days, the CRA expansion bill has its critics and is not guaranteed to pass, but it is sure to be presented sometime soon. At this point, the expansion legislation does not include credit unions, which many believe is a missed opportunity.

08/24/2010 - The Mortgage Rate Environment
by Quentin Keefe

Questions persist about how long these historically low mortgage rates can last? The answers are never easy when it comes to the financial markets, but the consensus seems to be that they will remain low for the foreseeable future. Why? Well, the easy answer is that the economy remains rather anemic, and so long as there is no real growth, continued low inflation, and unemployment teetering near double digits, there is really no where for rates to go. This, coupled with the fact that investor demand remains relatively high for bonds and consumers aren’t yet opening their pocketbooks are a recipe for continued support of these historically low mortgage rates. So, if you haven’t yet inquired into refinancing your existing mortgage, you should. And, if you are in the market to purchase a new home, you couldn’t have chosen a better time. Get pre-approved today and then call your local realtor.

08/12/2010 - Is This a Recovery?
by Quentin Keefe

So what is really going on with the economy? The latest NBC/Wall Street Journal poll shows that 64% of Americans don’t believe we have bottomed out yet. Can this be possible? Probably not, but consumer sentiment cannot be discounted either. Seeing that 2/3rds of our economy is fueled by consumer spending, a number like this cannot be ignored. But, the facts really don’t support this sentiment, although for so many this recession is anything but over. There is a lot of good news and all in all the economic indicators are much improved over two years ago. Corporate profits are back on track, job losses have been pretty much stopped and moderate job growth has begun, albeit, not nearly what we need in order to really get the economy heated up, `foreclosures are starting to slow and housing prices, for the most part, have stabilized. Bad economic news has a way of spreading like wildfire and can be very unsettling for American families. Good news is often seen as an anomaly and not given its due. Yes, this is what a recovery looks and feels like after the worse recession since the Great Depression. We are on the mend, slowly, but most certainly.

08/03/2010 - A Financial Roller Coaster
by Quentin Keefe

Just when it looks like rates are going up…well…Last week we had another strong week for mortgage-backed securities (MBS) due to all of the uncertainty about the economy. It seems every time there is positive economic news (bad for MBS’s), it is immediately countered with negative news(good for MBS’s). Hence, rates are on what is akin to a financial roller coaster…up one minute and down the next. This has lead to a pretty stable rate environment all in all. Yes, rates will go up. It’s inevitable. But when, at this point, is anyone’s guess?

Get the word out, because these historic low interest rates are definitely on life support!

07/27/2010 - Mortgage Rates Remain Low
by Quentin Keefe

Mortgage rates are among the lowest in history as the uncertainty about the pace of the economic recovery continues to attract investors to the safer investments such as government guaranteed mortgage-backed securities. This fact, coupled with low inflation has created a perfect storm for continued low mortgage interest rates.

The economic uncertainty has been best expressed in the housing sector. In June existing home sales were down 5% from much stronger May levels. Yet, they were still 10% higher than a year ago. While first time home buyers accounted for 43% of the sales, there is uncertainty going forward about how the end of the tax credit program will affect these new buyers. Still, the National Association of Realtors expects annual existing housing sales to be up in 2010 over 2009 and to grow even more in 2011.

The good news is that the economy, while certainly not recovering at a pace we had all hoped for, is, nonetheless, on a growth path. This week’s release of the second quarter Gross Domestic Product (GDP) will shed more light on what is happening in terms of broad economic activity. For now, anyone considering getting into the housing market or refinancing their existing higher mortgage rate should do so, because this “perfect storm” will not last forever!

07/01/2002 - Stocks Up,Rates Up
by Lance Winter, First Place Bank

View Blog

CONTACT US

Toll Free: 1-888-646-5626

New Hampshire Offices:

Manchester, NH HQ: 603-669-5626
Keene, NH: 603-352-0519
Portsmouth, NH: 603-431-3503
Conway, NH: 603-447-6060
Nashua, NH: 603-821-4975

Maine Offices:

Portland, ME: 207-221-5454
So. Portland, ME: 207-553-4343
Sanford, ME: 207-324-9600
Auburn, ME: 207-333-6969
Mexico, ME: 207-364-7892

Vermont Office:

Burlington, VT: 802-863-0403

View All Location Details

Local Websites

New Hampshire

Bedford NH
Concord NH
DerryNH
Keene NH
Londonderry NH
Manchester NH
North Conway NH
Portsmouth NH
Salem NH

Maine

Auburn ME
Gorham, ME
Lewiston ME
Portland ME
Sanford ME
Saco ME
York ME


Manchester, NH Mortgage Loan Office: 175 Canal Street Manchester, NH 03101 603-669-5626 Directions to this office	Portsmouth, NH Mortgage Loan Office: 100 Market Street, Suite 400 Portsmouth, NH 03801 603-431-3503 Directions to this office	Conway, NH Mortgage Loan Office: 66 Main Street - PO Box 447 Conway, NH 03818 603-447-6060 Directions to this office	Keene, NH Mortgage Loan Office: 149 Emerald Street Keene, NH 03431 603-352-0519 Directions to this office	Nashua, NH Mortgage Loan Office: 400 Amherst Street, Suite 100 Nashua, NH 03063 603-821-4975 Directions to this office

So. Portland, ME Mortgage Loan Office: 10 Atlantic Place So. Portland, ME 04106 207-553-4343 Directions to this office	Portland, ME Mortgage Loan Office: 94 Commercial Streete Portland, ME 04101 207-482-3950 Directions to this office	Sanford, ME Mortgage Loan Office: 1209 Main St. Sanford, ME 04073 207-324-9600 Directions to this office	Auburn, ME Mortgage Loan Office: 155 Center Street, Bldg. C Auburn, ME 04210 207-333-6969 Directions to this office	Mexico, ME Mortgage Loan Office: 313 Main Street Mexico, ME 04257 207-364-7892 Directions to this office

Burlington, VT Mortgage Loan Office: 3 Baldwin Ave. So. Burlington, VT 05403 802-863-0403 Directions to this office