Month: August 2023

Apache is functioning normally

Guaranteed Rate, the seventh-largest mortgage lender in the country, has laid off hundreds of employees across two rounds of layoffs this month, according to former staffers who were affected.

In the first round, the Chicago-based lender laid off project managers, director- and senior- level positions, as well as tech staff, multiple sources told HousingWire. The second round of layoffs this month mostly affected non-tech workers and included its vice president of creative, an operations training manager and a human resources director. 

Loan officers were let go in August as well, according to former employees. The company had 2,186 sponsored LOs as of Wednesday, per the National Multistate Licensing System (NMLS). 

One worker who was let go in the first round of layoffs said she was told the job cuts in August totaled about 800 positions.

“There was a budget number that every department was required to hit. Higher salary and director-level titles were affected mostly to hit the number,” the impacted former employee told HousingWire.

According to the former employee, the layoff came following weak sales in July. Mortgage recruiting platform Modex shows that the company originated $1.64 billion in July, down 30% compared to the previous month. The volume is still higher than the $1.17 billion in January, the lowest level in the current mortgage business cycle. 

“I would say the turnaround time on marketing projects has been slowed down because of the market for sure,” another former employee said on the condition of anonymity due to fear of retaliation.

Guaranteed Rate, a private company controlled by founder Victor Ciardelli, wrote on its website that it had more than 15,000 employees as of 2022.

Like other mortgage lenders grappling with sky-high rates and few home sales, Guaranteed Rate has seen significant turnover over the past year, former employees said.

HousingWire was unable to independently confirm the size of the layoff or details of the severance package, but multiple former employees said the layoffs were in the high hundreds. There have been at least five other layoff rounds since July 2022, former workers said.

Guaranteed Rate declined to comment on “any personnel matters.” No Worker Adjustment and Retraining Notification Act (WARN) notice had filed with the Illinois Department of Commerce and Economic Opportunity as of Tuesday. 

Guaranteed Rate originated $10.6 billion in the second quarter, up from the previous quarter’s $7 billion — totaling $17.6 billion in the first six months of 2023, according to data from Inside Mortgage Finance. The production volume in the first half of this year was down about 47% from the same period in 2022. Guaranteed Rate ended the second quarter with 2.5% market share, IMF data showed.

In a shrinking mortgage market, G-Rate has targeted first-time homebuyers and concentrated on products that aid affordability concerns. The lender launched a down payment assistance program in July. G-Rate will provide 2% of the required 3% minimum down payment for a conventional loan or up to $2,000 — whichever is lower. 

Last year, the lender rolled out its first personal loan product.

Other mortgage lenders have also been making large cuts to their already-dwindling workforces.

BMO Financial Group announced that it will let go of 248 employees in California next month and Wells Fargo will issue pink slips to 105 employees in Florida through early October, according to WARN notices from both states. 

Employment numbers in credit intermediation jobs — including LOs and tellers at depository institutions — fell to 2.67 million between April 2021 and July 2023, according to the U.S. Census Bureau.

Source: housingwire.com

Apache is functioning normally

Existing home sales for July were way down, about 17% from a year ago, the National Association of Realtors reported Tuesday.

Home sales have been slow mostly because mortgage rates have been high. The average rate on a 30-year fixed has once again cracked 7%.

A familiar refrain is reentering the chat for would-be homebuyers: ”Well, you can always refinance.”

It’s been a very long time since mortgage rates were this high. Think the turn of this century, from the late 1990s through 2001. So you’d forgive homebuyers for already considering a refi even before, you know, the original fi.

“You hear a lot of folks in the industry talking about ‘date the rate, marry the house,’” said Mike Fratantoni, chief economist with the Mortgage Bankers Association. “You’re going to be in the house for a long period of time, but you may be in this mortgage for just a couple of years.”

Date the rate, marry the house, aka eat the high monthly payment to get a foot in the door and then refinance after the Federal Reserve declares inflation officially whipped.

“So if you can find a home that you like, you can afford it, and then plus you have the option down the road of potential refinance if rates drop, that’s a pretty good combination,” Fratantoni said.

And if rates don’t drop, well, you still have the house with a 30-year fixed mortgage.

There’s even date the rate, marry the house memes on housing social media. Sacramento real estate agent Erin Stumpf isn’t a fan.

“I think it’s a little misleading,” she said. “The market fluctuates all the time.”

Stumpf said even if mortgages get cheaper, so might homes, which would complicate a refi. And she’s still scarred from that “you can always refinance” mantra that contributed to the foreclosure crisis.

“You know, 2007 was 16 years ago. I think that maybe has faded a bit from people’s memories a little bit more, but I certainly remember what it was like,” Stumpf said.

The good news is borrowers are much better credit risks than they were in the late 2000s, and banks are much more choosy about who gets a mortgage in the first place.

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Apache is functioning normally

It’s been a rough month or so for mortgage rates.

If we zoom out even further, it’s been a horrendous 18 months, with the 30-year fixed as low as 3% in the spring of 2022.

Today, you might be looking at an interest rate in the 7% range, or even the 8s if you have a particularly challenging scenario.

This has eroded affordability and ground the housing market to a halt, driven mainly by the Fed’s ongoing inflation fight.

So what will it take for mortgage rates to fall again? And how soon can we expect meaningful downward movement?

Will Mortgage Rates Go Back to 3%?

First things first, it’s doubtful mortgage rates go back to 3%. The 30-year fixed hit a record low of 2.65% in January 2021, per Freddie Mac.

The blue line above is the 30-year fixed, the green line the 15-year fixed.

The chances of rates returning to those ridiculously low levels seems unlikely, though you should never say never.

Anything is possible, though if we do get back there, it’s probably not going to happen anytime soon.

Ultimately, the Federal Reserve engineered those record low mortgage rates by purchasing trillions in mortgage-backed securities (MBS) and lowering its own short-term fed funds rate to near-zero.

The process is known as Quantitative Easing, or QE for short, and took place for much of the past decade.

Unfortunately, this accommodative rate environment was artificial, and eventually led to massive inflation, perhaps because it ran for too long.

The COVID pandemic certainly made things worse, with billions of dollars floating around in aid, coupled with these low rates.

As such, the Fed more recently launched QT, or Quantitative Tightening, which works in opposite fashion.

Instead of buying MBS, the Fed sells them. Of course, right now they’re only letting them run off from their portfolio, meaning they don’t reinvest in more if they’re prepaid, either by a refinance or home sale.

Theoretically, this puts upward pressure on rates, since the Fed is no longer a buyer and supply is ostensibly higher.

Long story short, we probably won’t see mortgage rates go back to 3%. But that doesn’t mean they need to stay at 7% either.

Will Mortgage Rates Go Down in 2024?

At the moment, there is an expectation that mortgage rates will go down in 2024.

While it might not feel that way, given the higher highs we’ve experienced over the past month, forecasts still predict that relief is on the way.

In case you hadn’t noticed, the 30-year fixed hit its highest point in over 20 years recently, hovering around 7.5%.

And it could be going higher before it moves lower. The highest the 30-year has ever been in the 21 century was 8.64%, back in May 2000, per Freddie Mac.

It’s possible we could test those levels again if inflation continues to be an issue. Or if the Fed indicates that it’ll need to resume raising short-term rates.

But there’s currently no indication that will be necessary given some positive steps on the inflation front in recent months.

Still, it’s not out of the question given the current mortgage rate environment, which has been volatile to the upside.

Anyway, the Mortgage Bankers Association (MBA) just released its latest Mortgage Finance Forecast for August. And there’s some good news in there, if you believe they’ll get their predictions right.

They currently expect the 30-year fixed to fall into the 5% range for all of 2024.

Q1: 5.9%
Q2: 5.6%
Q3: 5.3%
Q4: 5.0%

What’s more, they predict that the 30-year fixed will average 4.6% in 2025, which sounds too good to be true.

And it certainly might be, as their forecast for 2023 has already missed the mark. They expected mortgage rates in the mid-6s this year.

As noted, we’re closer to the mid-7s right now, so if that’s any indication, these 2024 forecasts might not carry much weight.

But the fact that they’re at least aiming that low can be taken as a positive.

Meanwhile, Fannie Mae released its latest housing forecast for August 2023 and they see relief on the horizon as well.

While not as aggressively optimistic, they still have the 30-year firmly back in the 6s in 2024.

Q1: 6.5%
Q2: 6.3%
Q3: 6.2%
Q4: 6.0%

For what it’s worth, the National Association of Realtors (NAR) also has the 30-year fixed averaging close to 6% even for much of 2024.

So the consensus seems to be mortgage rates in the 5-6% range for 2024, which would be welcome news given current market rates.

It Might Take Longer for Mortgage Rates to Fall (Just Like It Took Longer for Them to Rise)

If you recall the low mortgage rate years, which lasted over a decade from around 2012-2022, you may remember that year after year the forecasts called for higher rates.

But each year, mortgage rates defied those predictions and moved lower.

In other words, the same economists I highlighted above were wrong when rates were on the way down, and might be wrong as they move higher.

We’ll hope they’re right for the sake of the housing market, but there’s certainly no guarantee.

In fact, we could be stuck in a similar dynamic where mortgage rates have a tough time coming back down to earth.

The only way we see big downward movement is if inflation actually cools off and stays cool. And mortgage spreads tighten, for much the same reason.

If the economy doesn’t cooperate over the coming months, we might be in for higher mortgage rates, or simply the status quo in the high 6s and low-to-mid 7s.

The best way to approach this mortgage rate environment is to hope for the best, but prepare for the worst.

These higher rates could go higher, and may stay there longer than expected. But if they do fall as predicted, the housing market should find its footing again before long.

Read more: Why Are Mortgage Rates Still Going Up If the Fed Is Done Hiking?

Source: thetruthaboutmortgage.com

Apache is functioning normally

Two weeks since the first report of a wildfire in Lahaina, Hawaii, the scope of the tragedy is coming into focus.

Search teams looked through every single-story residence in the disaster area and found the remains of 115 people. The death toll is likely to grow as teams now look through multi-story residences and commercial properties.

As of Aug. 21, the fire, which began on Aug. 8, was considered 90% contained and has burned through more than 2,100 acres, according to Maui County.

More than 2,000 buildings in Lahaina were destroyed or damaged by the blaze, according to an artificial intelligence model compiled by Esri, a geographic information system software provider.

The AI model reviewed satellite photos of Lahaina before and after the fire and estimated on Aug. 11 that 2,088 structures – about 63% of all structures in the examined area – had been destroyed or damaged.

Most buildings were homes. The Federal Emergency Management Agency estimated on Aug. 12 that the fire had destroyed 1,466 houses; 85% of all structures that were assessed were destroyed.

Based on Esri’s estimates of damaged structures and building types provided by USA Structures, nearly 1,800 residential structures were damaged in the fire. USA Structures is a dataset maintained by the Department of Homeland Security, the Federal Insurance and Mitigation Administration, FEMA, Oak Ridge National Laboratory and the U.S. Geological Survey.

The financial toll of the damage is vast for a town of about 12,000 people. Rebuilding costs could total more than $450 million for residential structures alone, based on Esri’s damage assessment and Maui tax roll data.

That includes $242.1 million in total building value for owner-occupied homes, $136.1 million for non-owner occupied homes, $40.7 million for short-term rentals and $23.2 million for long-term rentals, based on the building values of parcels that overlap Esri’s assessed damaged buildings.

The median residence assessed damaged by the fire was a 62-year-old, three-bedroom, two-bath structure valued at $242,700, excluding land value.

The damage also complicates hundreds of millions of dollars’ worth of mortgages. Lenders originated more than $670 million in mortgages for borrowers to purchase, improve or refinance single-family dwellings in the census tracts covering Lahaina in 2018-2022, the most recent Home Mortgage Disclosure Act data available.

Lenders originated more than 1,200 such loans over that period, led by Bank of Hawaii with 525, First Hawaiian Bank with 490 and HighTechLending Inc. with 470.

Many of the loans loans originated by these lenders were then purchased by Fannie Mae and Freddie Mac.

The Department of Housing and Urban Development has granted homeowners with Home Equity Conversion Mortgages or mortgages insured by the Federal Housing Administration a 90-day moratorium on foreclosures. HUD also announced a package of regulatory and administrative waivers for further assistance to those in the disaster area.

Homeowners may also borrow up to $500,000 to repair or replace their homes in a low-interest disaster loan from the Small Business Administration. Real estate professionals, too, have provided relief funds.

Officials’ primary efforts are still directed towards meeting the immediate needs of people in the disaster area; a full assessment of the damage and what rebuilding will cost will come later.

So far, FEMA has approved more than $5.6 million in assistance to nearly 2,000 households, including more than $2.3 million in initial rental assistance. Maui County officials estimate about 1,900 people are currently sheltered in hotels. The Environmental Protection Agency and Army Corps of Engineers have started debris collection.

Beyond the need for rebuilding, the wildfire’s long-term impact on insurance and affordable housing remain to be seen.

Hawaii is one of several states recently affected by natural disasters, including wildfires.

Will Robinson is a data journalist at HW Media.

Source: housingwire.com

Apache is functioning normally

Airbnb ha cambiado mucho desde sus humildes comienzos en 2007. Lo que empezó como una forma para que los propietarios de viviendas obtuvieran ingresos extras alquilando sus habitaciones desocupadas se ha convertido en un gigante multimillonario que ha revolucionado el sector.

La mayoría de los viajeros ahora alquilan propiedades enteras en lugar de alojarse con los dueños. Las noches reservadas en habitaciones privadas representaron solo el 16% de las reservas de alquiler a corto plazo en Estados Unidos en mayo de 2023, un mínimo histórico, según un informe de AirDNA, una empresa de análisis de alquileres de corta duración.

Y muchos de los anfitriones que alquilan sus casas no son propietarios que intenten obtener ingresos extras, sino más bien empresas grandes de administración (en inglés) con múltiples propiedades en sus carteras (algunas con decenas o hasta cientos). A estos grupos de administración de propiedades se les conoce como “megahosts”.

Más del 30% de las propiedades que se anuncian en EE. UU. están administradas por anfitriones con 21 o más propiedades, según datos facilitados por AirDNA. Esta cifra es superior al 26% de propiedades administradas por anfitriones con una sola propiedad.

Es decir, casi tres de cada cuatro propiedades que se anuncian en Airbnb (en inglés) están administradas por anfitriones con más de una propiedad en su cartera. Esta tendencia nos lleva a preguntarnos: ¿es bueno para los viajeros alojarse en propiedades de un “megahost”?

El impacto en la experiencia de los huéspedes

Alojarse en la casa de otra persona tiene su encanto. Si los anfitriones viven cerca, pueden ofrecer recomendaciones locales u otros detalles personalizados. Sin embargo, muchos anfitriones de Airbnb a pequeña escala tienen poca experiencia en hostelería, y pocos están disponibles las 24 horas del día, los 7 días de la semana, para responder a inquietudes de los clientes.

En principio, las empresas de administración a mayor escala podrían ofrecer a los huéspedes una experiencia más profesionalizada, pero esto va en desmedro del factor humano. La empresa de administración probablemente no podrá decirle a usted qué pastelería tiene las mejores galletas, por dar un ejemplo.

A fin de explicar esta dualidad con datos, AirDNA analizó las opiniones de los huéspedes de propiedades en Europa administradas por “megahosts” y las comparó con anfitriones de menor escala. Lo que se descubrió fue una tendencia constante: cuanto mayor es la cantidad de propiedades, más baja es la calificación media.

A primera vista, estos datos parecen sugerir que las propiedades gestionadas por grandes empresas ofrecen de manera constante una experiencia deficiente, pero Jamie Lane, economista jefe de AirDNA, sospechaba que la respuesta era distinta.

“Las calificaciones suelen ser más bajas cuando se valora a una empresa que a una persona”, afirma Lane, lo que sugiere que conocer e interactuar con una persona en lugar de hacerlo con una empresa de administración lleva a los huéspedes a dar calificaciones más altas.

Para explicar este fenómeno, el equipo de Lane analizó las calificaciones en la sección de “ubicación” de la opinión general del huésped, que no debiera depender del tamaño de la cartera del anfitrión.

Se descubrió la misma tendencia: calificaciones más bajas en varias valoraciones para carteras más grandes. Sin embargo, también se revelaron otros detalles interesantes. Los anfitriones de mayor tamaño solo obtuvieron una puntuación ligeramente inferior a la de los anfitriones de una sola propiedad en las calificaciones de limpieza, aunque los anfitriones con más de 300 propiedades en realidad obtuvieron una puntuación ligeramente superior a los que tenían entre 100 y 299 unidades.

Cuantas más unidades tiene un anfitrión, más baja es la calificación media en comunicación. Lane sugiere que esto tiene lógica dada la falta de interacción personal que existe de parte de los “megahosts”.

“Normalmente doy (a un anfitrión de una sola propiedad) una reseña más alta que si alquilara por medio de Vacasa y estuviera comunicándome con su personal de servicio al cliente en Filipinas”.

¿Los anfitriones con carteras más grandes reciben calificaciones más bajas porque su servicio es inferior? ¿O se debe a que los huéspedes son más comprensivos con los anfitriones más pequeños? La respuesta parece ser “las dos cosas”.

Lo que debe hacer un viajero

La elección entre un anfitrión de Airbnb a pequeña o gran escala va a depender de las preferencias que usted tenga. Si desea algo más parecido a un hotel, quizá se sienta más cómodo con una empresa de administración profesional. Si le importa más la experiencia personalizada, considere la posibilidad de buscar un anfitrión con solo una o dos propiedades.

Airbnb no facilita mucho la búsqueda de propiedades según el tamaño de la cartera del administrador, o incluso para ver cuántas propiedades gestiona un determinado anfitrión. De modo que, para encontrar una propiedad y un anfitrión que se ajusten a sus preferencias tendrá que hacer clic en las propiedades que le interesen y consultar los perfiles de los anfitriones.

Y tenga en cuenta que muchas propiedades están administradas por anfitriones de tamaño medio que son personas reales (no empresas) y con mucha experiencia. Esta podría ser la solución ideal para muchos viajeros que buscan un servicio de alta calidad, pero sin tener que sacrificar el trato personal.

“Existe una marcada tendencia a la profesionalización, pero eso no siempre significa que las propiedades estén administradas por grandes empresas”, afirma Lane. “Hay muchas organizaciones de tamaño medio que están utilizando herramientas para que sus operaciones se vuelvan mucho más profesionales”. Por último, no hay que confundir “superhosts”, una designación oficial de Airbnb para anfitriones que constantemente reciben calificaciones altas, con anfitriones con varias propiedades. Los superhosts (en inglés) pueden tener una sola propiedad o cientos, y suelen ser algunos de los anfitriones más fiables de la plataforma.

Este artículo fue publicado originalmente en NerdWallet en inglés.

Source: nerdwallet.com

Apache is functioning normally

After opening this spring at 7463 Girard Ave. (behind D.G. Wills bookstore), nationwide creative studio Board & Brush is making a home in La Jolla.

The local studio, run by La Jolla residents Doug Vocelle and Sam Grissom, offers instructor-led art projects — mostly on wooden boards — in the form of home decorations, serving trays, signs and more.

To learn more, the La Jolla Light posed the following questions to Vocelle:

Q. When did your business start? Who founded it? What is its mission?

A. Board & Brush was founded by Julie Selby and started as a neighborhood holiday party making wood signs in her basement in December 2014. It quickly turned into a successful business model, opening the first studio in March 2015 in Hartland, Wis. Flash forward to today and there are over 250 studios in 43 states as well as Canada and Japan.

Q. What services do you offer?

A. We offer instructor-led [do-it-yourself] workshops working mainly with wood to create inspirational signs, trays, boxes, planters, trivets, coat racks and so much more. There are over 800 different projects to choose from. We also offer specialty workshops for doormats and totes. Our corporate creative team is constantly adding new and exciting options for functional and decorative home decor.

Board & Brush is an experience. We specialize in birthday parties, girls’ or moms’ nights out, date night, team-building and invite you to grab a friend and join us for a workshop.

Q. What makes you and/or your company unique compared with similar businesses?

A. While we may be similar to those paint-and-sip studios people may be aware of, we’re different in a significant way. Sure, we have great music and videos on big-screen TVs, adult beverages and snacks, but our customers leave our studio with a project that won’t end up squirreled away in a corner of a shelf. When you leave Board & Brush, you’ll leave with a beautiful piece of home decor that you will use and be proud to tell your friends and family, “I made that!”

Q. What’s new recently with the business that you want everyone to know about?

A. We’re excited to offer our first doormat workshop in August and our first Time Crunch Workshop, which is a great first-time option with smaller projects and a shorter workshop time. It won’t be long until we’re busy with Halloween- and fall-themed workshops, which are also a huge hit.

Q. What are the advantages of working in La Jolla?

A. We live right here in The Village and wanted our studio to be here, too! We’ve had wonderful customers from all over greater San Diego, some not familiar with La Jolla. They are thrilled that we have five parking spaces dedicated to our studio right in front. We love giving tips for places for our customers to go eat after a workshop, what to see and where to shop, which happens frequently.

Our website, boardandbrush.com/lajolla, is the place to browse our calendar and book your workshop. Please follow us on Facebook and Instagram @boardandbrushlajollaca for our latest updates, flash sales and giveaways.

— Business Spotlight features enterprises that support this publication. ◆

Source: lajollalight.com

Apache is functioning normally

Update: my mistake, seems it’s just the same old .55 cents redemption option. I think what’s new is that you can now offset regular purchases whereas previously you could only get the .55 toward rent payments.

Bilt Mastercard sent out an email that they’ve added an option to cashout points at 1 cent per point. The points can be applied as a statement credit against any charge on the Bilt Mastercard.

While most people will value the travel transfer options more, this is a nice improvement. At a minimum it gives a backup 1-cent baseline value for the points, and might also be useful for someone who isn’t interested in travel. We’ve updated out full Bilt Mastercard review with this additional option.

Hat tip to uscreditcardguide

Source: doctorofcredit.com

Apache is functioning normally

Wells Fargo announced today that its home loan modification program will be available for 478,000 Wachovia customers acquired via the merger completed earlier this month.

That includes scores of borrowers trapped in nasty Wachovia Pick-a-Payment loans, the high-risk loans that sunk the too-big-to-fail banking giant months earlier.

Customers on the verge of foreclosure or currently in foreclosure will receive an extension until February 28 so they have more time to explore possible alternatives.

“As the ‘investor’ for these loans, we are rapidly designing programs to help these customers,” said Mike Heid, co-president of Wells Fargo Home Mortgage, in a release.

“For those at-risk, we will offer combinations of term extensions of up to 40 years, interest rate reductions, charge no interest on a portion of the principal for some period of time and, in geographies with substantial property value declines, we will even use permanent principal reductions.”

He added that the general goal is to get at-risk borrowers near a 38 percent housing payment debt-to-income ratio.

The San Francisco, CA-based bank and mortgage lender has increased its full-time default/home retention staff 125 percent in the past two years, while Wachovia has increased similar positions by 330 percent in the last year alone.

Wells Fargo inherited roughly $120 billion in new mortgages when it agreed to acquire Wachovia last year, many of which are now deemed extremely toxic, putting the company’s relatively conservative position into question.

However, Heid boasted that 93 of every 100 Wells Fargo mortgage customers are current on their mortgage payments, performance well above the industry average.

Source: thetruthaboutmortgage.com