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Weekly housing inventory data

Active inventory still needs to be faster for my taste. My model has active inventory growing at least 11,000-17,000 every week with higher rates. This model was based on rates over 7.25%, but even when mortgage rates headed toward 8% last year, we didn’t see that kind of growth in inventory. This week, inventory fell week to week, but that’s the Easter bunny’s fault.

  • Weekly inventory change (March 29-April 5): Inventory fell from  517,355 to 512,930
  • The same week last year (March 30-April 7): Inventory rose from 410,734 to 411,577
  • The all-time inventory bottom was in 2022 at 240,194
  • The inventory peak for 2023 was 569,898
  • For some context, active listings for this week in 2015 were 1,021,567

New listings data

While the number of new listings isn’t growing as fast as I thought it would this year, it’s still growing, which means we have more sellers looking to buy a home once they sell. This variable can change when we experience a recession or job loss. However, for now, this is a plus for the U.S. housing market, and we should ignore the decline last week.

Number of new listings last week, by year:

  • 2024: 54,769 
  • 2023: 55,008
  • 2022: 63,374

Price-cut percentage

In an average year, one-third of all homes take a price cut; this is standard housing activity. When mortgage rates go higher and demand falls, the price-cut percentage grows; when rates drop, and demand gets better, the percentage falls.

It’s also critical to consider the year-over-year data with this line. Last year, when mortgage rates were heading toward 8%, the year-over-year price-cut percentage was continuously declining, which makes sense when you consider 2022 was a very abnormal year with the most significant home sales crash ever. As inventory is growing and demand isn’t booming on the mortgage side of things, the price-cut percentage is increasing year over year.

It’s critical to keep track of this data line as it shows price growth cooling down. That’s always what the doctor ordered because we have had massive housing inflation post-COVID-19. Having accurate weekly data gives us a big advantage to see what’s coming next.

Here’s the price-cut percentage for last week over the last several years:

  • 2024: 32%
  • 2023: 29.9%
  • 2022: 17.6%

10-year yield and mortgage rates

We had some good and bad news last week with mortgage rates.

First, the bad news” The 10-year yield broke a critical support level on Friday, and if we get more bond market selling, that will pressure mortgage rates higher.

But the good news is that the spread between the 10-year yield and mortgage rates is getting much better, sooner than I thought it would this year. We didn’t see much reaction on Friday with mortgage rates because the spreads were good. This is a huge plus because if and when the 10-year yield falls and if the spreads get even better, this means we could quickly get sub-6% mortgage rates with the 10-year yield at 3.37% — without it even breaking my “Gandalf line in the sand.”

I wrote a detailed article on Friday analyzing the jobs report, and showing how the latest labor data gives the Federal Reserve a pathway to land the plane if they want. See here for more details and charts.

As you can see below, even though the growth rate of inflation has fallen a lot, CPI inflation has gone from over 9% year over year to 3.2%; the 10-year yield is still elevated. As always, the labor data is more important than inflation data for now.

Purchase application data

Purchase application data didn’t move much last week, making it back-to-back weeks with flat weekly data. It was flat on a week-to-week basis and down 13% year over year. Since November 2023, after making holiday adjustments, we have had 10 positive and six negative purchase application prints and two flat prints. Year to date, we have had four positive prints, six negative prints and two flat prints.

The data tells me that since late 2022, many people have been waiting for lower mortgage rates, and even though rates are elevated compared to the last decard, people still jumped back into the market. Imagine if mortgage rates stayed near 6% for a year — mortgage demand would grow and we wouldn’t need tax credits to boost demand for existing homes.

Week ahead: Inflation week!

We are jumping right from jobs week into inflation week with the upcoming CPI and PPI inflation data. These will be important reports as many market players have used the seasonal base pricing variable as a reason why the last two months’ inflation data was a bit hotter than usual. This week will be critical to watch because if the inflation data comes in cooler than anticipated, the 10-year yield should fall, and with spreads getting better, that will be a plus for mortgage rates.

Source: housingwire.com

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HELOC, 2nd Mortgage, Pre-Qual, LOS, QC Tools, Dept. of Labor, PrimeLending, and Whistleblowing

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HELOC, 2nd Mortgage, Pre-Qual, LOS, QC Tools, Dept. of Labor, PrimeLending, and Whistleblowing

By:
Rob Chrisman

Thu, Mar 28 2024, 11:50 AM

Here’s a tip of the day for anyone manning a conference booth: instead of a pen, or mouse pad, how about a locally made treat? Hats off to Aimee, Bobby, and Mark from Byte Software who earlier this week at the TMC event had chocolate-covered Oreos from a local bakery. Technology was a big topic at TMC… Technology thoughts from 50 years ago? Here you go. (There’s definitely a school of thought which believes that the iPhone changed tech overnight. Almost 20 years later, nothing else has come close.) Vendor news seems to be at every conference, and capital markets staff are certainly big users of tech. At the TMC enclave secondary marketing folks often gravitate toward each other, “shooting the breeze” about odds and ends. For the most part, no one thinks they earn a living by making predictions, instead providing accurate information to other managers and owners, and acting as an advisor about loan profitability, leakage, concessions, and margins. Capital markets staff are also involved in LO and executive recruiting efforts, and in developing strong product offerings to help the company be successful. (Found here, this week’s podcasts are sponsored by Stavvy. Stavvy offers a flexible and fully customizable loss mitigation solution. Servicers can easily adapt to regulatory updates and market conditions, providing a seamless, customer-centric digital experience. Today’s has an interview with AmeriCatalyst’s Toni Moss about the Extreme Climate, Housing and Finance Leadership Summit on April 18-19, in Washington, DC.)

Lender and Broker Services, Products, and Software

“Real estate valuations continue to be complex and ever-evolving, especially today with proposed regulatory changes and unpredictable market dynamics. Creating an effective valuation strategy is vital for lenders to manage risk and streamline operations. Attend our complimentary webinar to learn all about the world of automated valuation models (AVMs). You’ll find out why AVMs are considered a credible, objective option for collateral risk management, how they can help your business (from lead generation and portfolio management to cost reduction and more), and when to use an AVM to address challenges in the current valuation landscape. The webinar hosted by ICE is “When, Why and How AVMs Drive Business Performance” and will be on Wednesday, April 10, at 2 p.m. ET. Save your seat now: register today.

“Step by Step Quality Control Plan Checklist: Comprehensive Guide for Financial Institutions. By following this guide, financial institutions can not only enhance their operational excellence but also strategically minimize their risk exposure. Throughout this comprehensive guide, we dissect each facet of the QC plan, providing valuable insights, practical recommendations, and actionable steps. Our checklist aligns with industry requirements and best practices, ensuring lenders remain steadfast in their commitment to quality within the ever-evolving landscape of financial services. Access Guide.

Many industry vendors talk a good game when it comes to partnering with lenders, but there is a difference between treating a client like a partner and making them feel like a prisoner. Restrictive long-term contracts and financial penalties for not going live or for trying to exit failed implementations are hurting lenders and servicers. These developers make it difficult or impossible for the lender to move to a new, modern system. Lenders deserve better. You won’t get treated that way by MortgageFlex, the creators of the industry’s first cloud-native, unified system for origination and servicing. A re-engineered LOS built by developers that lenders have trusted for 40 years and the industry’s best new software platform operating on the same database makes this the must-see software. See it today.

Why do those in the mortgage space watch the 10-year U.S. Treasury note? Historically, the 10-year U.S. Treasury yield has been considered a key benchmark for mortgage rates. Mortgage rates, however, are not actually based on the 10-year U.S. Treasury note (as is commonly believed). MCT released a blog, “How the 10-Year U.S. Treasury Note Impacts Mortgage Rates” that serves as an excellent primer for how mortgage interest rates respond to moves of the benchmark U.S. Treasury note. The piece discusses why mortgage rates and Treasury yields move together and how bonds are influenced by Treasury yields. With a trusted capital markets partner like MCT, you can rest assured that you will be notified of how economic trends could have the potential to impact your business. Sign up for MCT’s newsletter to receive educational articles like this one and learn more about variables that impact mortgage rates.

Sending your borrowers off on their home search hoping they reach out when they need you is one way to do things. Sending them with a QuickQual that lets them run payment scenarios and generate a letter when they’re ready to submit an offer is another. Check out a sample QuickQual if you’re interested in the latter.

Correspondent and Broker Products

“With spring in the air, Newrez Correspondent is springing into action by adding many exciting enhancements to our product line. We now offer a Closed End Second Mortgage program, Delegated Non-QM for our Smart Series products, and Fannie Mae HomeReady® and Freddie Mac Home Possible® affordable lending mortgage programs including the recent $2500 credits added for qualifying homebuyers. Take advantage of our expansive menu and become a valued customer at Newrez Correspondent by signing up here. You can also reach out to Sarah Johanns to set up a meeting at the Iowa Mortgage Association Conference in Coralville, IA, on April 1 and 2, and Beverly Jordan, Patty Devita, Rebecca Yonaka or John Dubisky at the Great River Conference in Memphis, TN, April 16 through 18. Don’t forget, we would love to meet at the MBA Secondary in New York in May. Set up a meeting here.”

“At Button Finance, we say YES. That is why more and more brokers and correspondent lenders are choosing to fund their HELOANs and HELOCs with Button Finance. Is it the lighting quick turn-times and aggressive pricing, or the limited UW overlays? Can you make up to 5% compensation as a broker or 8% as a correspondent on HELOCs or even originate to our bank statement and investment property programs? The answer is YES, YES, YES, YES, and YES. Available equity is at historical levels, so now is a great time to offer your past and prospective borrowers Button Finance HELOAN or HELOC to pay off high-interest revolving debt. Button Finance programs allow FICO scores as low as 660, CLTVs to 90%, and debt ratios to 50%. We have excellent correspondent offerings as well. Correspondents typically make $18,500 on a $250k HELOC closed in 10 calendar days without an appraisal. Contact us today.”

Department of Labor and Whistleblowers

The U.S. Department of Labor has ordered a former senior vice president and two managers employed by PrimeLending to pay $35,000 in emotional damages and the legal fees of two California employees who the company fired illegally after they reported a branch manager pressured them to pass on fees to loan applicants caused by the company’s internal processing delays.

“Investigators with the department’s Occupational Safety and Health Administration found the nationwide lender violated whistleblower provisions in the Consumer Financial Protection Act by terminating the employees who raised their concerns with a regional manager and senior vice president of Human Resources.

“’Employees who report potential consumer fraud are protected by federal law against retaliation of any kind. Under the Consumer Financial Protection Act’s whistleblower provisions, managers can be fined personally for retaliation,’ explained OSHA Regional Administrator James D. Wulff in San Francisco. ‘In this case, OSHA fined three PrimeLending managers for trying to prevent workers’ concerns from coming to light. The U.S. Department of Labor will not tolerate retaliatory actions against workers exercising their rights and those responsible for such actions will be held accountable.’”

“In addition to payment of personal damages, OSHA ordered PrimeLending to pay an undisclosed amount in lost back wages and interest to the employees. The company must also expunge the employment records of both employees, post an anti-retaliation notice at all its branches and train its employees about their rights under the Consumer Financial Protection Act.

“The company and the managers sanctioned may appeal OSHA’s order to the department’s Office of Administrative Law Judges.

“OSHA enforces the whistleblower provisions of the Consumer Financial Protection Act and 24 other statutes protecting employees who report violations of various motor vehicle safety, commercial motor carrier, airline, consumer product, environmental, financial reform, food safety, healthcare reform, nuclear, pipeline, public transportation agency, railroad, maritime, securities, tax, antitrust, and anti-money laundering laws and for engaging in other related protected activities. For more information on whistleblower protections, visit OSHA’s Whistleblower Protection Programs webpage.”

Capital Markets

Not a whole lot to report from yesterday. Consumer confidence was little changed in March with consumers remaining concerned about elevated price levels, according to the Conference Board. Consumers expressed more concern about the U.S. political environment compared to prior months. The market saw a bit more buying than in previous days in reaction to a strong $43 billion 7-year note offering.

Since we can’t go a day without talking about the Fed, you’ve probably noted that some Federal Open Market Committee voters ratcheted back their estimates to two rate cuts in 2024 from the group consensus of three 25 basis point rate cuts. However, of potentially more interest to the mortgage industry is the central bank’s massive balance sheet of Treasuries and Agency mortgage-backed securities (MBS) that remains from the past 15-ish years of aggressive experimental monetary policy.

The Fed has been open about wanting to eventually get back to an all-Treasury balance sheet, so it is expected that the central bank will not halt the run-off of Agency MBS that has averaged about $16 billion per month over the last six months. The central bank is expected to reinvest those proceeds into Treasuries, so where will demand for Agency MBS come from? Hopefully, domestic banks. U.S. domestically chartered commercial banks’ total holdings of securities as a percentage of their balance sheet, and Agency MBS in particular, has ticked up over the last six months. This trend should continue as long as the relative value of Agency MBS remains favorable compared to investment-grade corporates and Treasuries.

Tomorrow the markets are closed, and today brings a busy schedule in terms of data ahead of a SIFMA recommended early close, which also happens to be month and quarter-end, ahead of Good Friday. There will be a commentary tomorrow that includes the PCE reading, the Fed’s preferred measure of inflation. This morning we’ve had the final look at Q4 GDP (3.4 percent, higher than previously but viewed as old news) and weekly jobless claims (210k, 1.819 million continuing claims). The core PCE deflator was (3.3) versus an expectation of unchanged at 2.1 percent. Later today brings Chicago PMI for March, Michigan sentiment, pending home sales for February, KC Fed manufacturing, several Treasury auctions of short duration bills, and Freddie Mac’s Primary Mortgage Market Survey.

We begin the day with Agency MBS prices little changed from Wednesday, and little changed all week! The 10-year is yielding 4.23 after closing yesterday at 4.20 percent and the 2-year is at 4.62… little movement after a salvo of news.

Jobs

Canopy Mortgage in National spotlight: Massive sales growth, onboarding an average of 1 producing loan officer every other day! What’s attracting LO’s to move in droves? Canopy is “Giving Loan Officers the Power to Grow” – read full article on forbes.com. Canopy’s magnetic growth is coming from relationships, referrals and jaw-dropping tech demos. If you haven’t heard about Canopy yet …ask a friend! Canopy is building the future of mortgage lending through relationships and innovative mortgage tech, and is hiring producing LOs nationwide (except NY). Don’t miss out! Schedule a Tech Demo, or simply look at your numbers with Josh Neumarker today 888-696-9076.

Planet Home Lending, a national mortgage lender, servicer, and asset manager, has hired Andy Insua as Regional Sales Manager for the Southeast. Congratulations!

 Download our mobile app to get alerts for Rob Chrisman’s Commentary.

Source: mortgagenewsdaily.com

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Unsecured credit cards, which don’t require a form of collateral to use them, tend to be the most popular kind of credit card. In addition to helping you build credit, these cards often come with perks and benefits, like cash back rewards or free travel insurance.

To decide if an unsecured credit card is right for your financial situation, read on. You’ll learn what an unsecured credit card is, how it works, and the pros and cons of using one.

What Is an Unsecured Credit Card?

When you think of what a credit card is, you’re most likely thinking of an unsecured credit card. An unsecured credit card is a line of credit that gives cardholders the ability to use credit at their whim. In other words, as a cardholder, you can use your credit up to its limit and pay it off continuously, with no end date. Unsecured credit cards get their name since they don’t require a deposit or collateral, unlike secured credit cards.

Depending on the credit card you qualify for, you might be able to receive some additional benefits and perks with an unsecured credit card like cash back rewards.

How Does an Unsecured Credit Card Work?

You’ll receive a credit limit when you open an unsecured credit card. Your credit limit is the maximum credit you can use on this account. You must pay at least the credit card minimum payment each billing cycle if you’ve used the card. Here are some points to know:

•  Your monthly payment will vary depending on how much credit you used during that billing cycle (in fact, some months, you may even have a negative balance on your credit card).

•  If you miss a monthly payment, you’ll likely have to pay a penalty or fee for the infraction.

•  If you make only the minimum monthly payment, your remaining balance (plus accrued interest based on the APR on a credit card) will carry over until the next month.

So, to avoid penalties, fees, and accrued interest, it’s best to pay your balance in full every month.

But, if this isn’t feasible with your budget, aim to pay more than the minimum every month so you can quickly chip away at your total outstanding balance. Just be sure to keep in mind how credit cards work when deciding how much to pay in a given month.

Pros and Cons of Unsecured Credit Cards

Some of the benefits and drawbacks of unsecured credit cards may be obvious. But, to help you determine the risks and rewards of using this type of credit card, here are some pros and cons to get familiar with.

Pros

Upsides of unsecured credit cards include:

•   Higher credit limits: Applicants usually must have a competitive credit score to qualify for an unsecured credit card. For this reason, credit card companies may apply a higher credit card limit since you’ve proved your creditworthiness.

Also, having a higher credit limit can impact your credit utilization ratio, the amount of credit you use compared to the amount of credit you have available. Your credit utilization ratio is used to assess your credit score, and a higher ratio may negatively impact your score. With a higher amount of credit available, it’s easier to maintain a lower ratio.

•   Potential to earn rewards: Many unsecured credit cards offer incentives like cash back or airline miles to encourage cardholders to use their credit. They may also offer additional benefits, such as complimentary airport lounge access or hotel credits. So, when comparing your unsecured credit card options, be sure to look at all perks and rewards that may be offered.

•   Frequently reports credit history to credit bureaus. Since card issuers take on more risk by lending credit to cardholders, they usually report your credit activity to the credit bureaus on a monthly basis.

Your credit usage is another factor used to determine your credit score, so these regular reports can help you assess how well you’re managing your credit. If you’re managing it well, these frequent reports can help your score.

•   An abundance of options: Unsecured credit cards are the most popular type of credit card. Therefore, there’s a vast array of credit card options at your disposal. Because there are so many options, you’ll likely be able to find one suitable to fit your needs.

Cons

While there are many advantages of using an unsecured card, some may come with some downsides, including:

•   Varying approval requirements: Every credit card company usually has different credit card approval requirements, and you’ll generally need a higher score to qualify for an unsecured versus a secured credit card.

For example, some secured credit card requirements are a credit score of at least 580; others may require a score of at least 680. Researching requirements beforehand can help you identify the best cards available that you can qualify for with your credit score.

•   Extra fees: Some unsecured cards may come with extra fees, such as convenience fees, cash advance fees, or foreign transaction fees. Keep in mind that not all cards charge these fees, though, so it’s worth it to compare your options based on your needs. For example, if you travel abroad often, you may want to choose a card that doesn’t have foreign transaction fees.

Pros Cons
Higher credit limits May charge additional fees such as convenience fees, balance transfer fees, or cash advance fees
Wide range of credit card options available Different credit requirements for approval
Rewards such as cash back or miles
Usually report to credit bureaus

Unsecured vs Secured Credit Cards: What Are the Differences?

The most significant difference between unsecured versus secured credit cards is that secured cards require a deposit while unsecured cards don’t. Your deposit on a secured credit card usually dictates your credit limit. Depending on the credit card company and your credit score, your deposit may vary between $200 and $3,000, which is far lower than the average credit card limit.

Requiring a security deposit eliminates some of the creditors’ risks; thus, it can be easier to qualify for a secured credit card than an unsecured credit card. Keep in mind, no matter what type of card you have, you’ll find the most favorable terms if you have good credit, such as a good APR for a credit card. Also, you may have to forgo any rewards while you build your credit with a secured card, as they don’t often offer them.

If you fall behind on your payments, your creditor could cancel your card and send your remaining outstanding balance to a third-party collector with either an unsecured or a secured credit card. However, if you have a secured credit card and your payment is past due, your creditor may keep your security deposit to pay off some of the remaining balance.

Beyond these few items, there is no other real difference between the inner workings of a secured credit card and an unsecured credit card.

•  Each card allows you to make purchases at locations that accept credit card payments.

•  During the billing cycle, you must make at least a credit card minimum payment.

•  Otherwise, you may have to pay fees or penalties with your secured or unsecured credit card.

Secured Credit Card Unsecured Credit Card
Requires a refundable deposit ✓ X
Can qualify with poor credit ✓ ✓
Can come with rewards ✓ ✓
Requires at least a minimum payment every month ✓ ✓
Used to make purchases ✓ ✓

Who Should Consider an Unsecured Credit Card?

Since there are plenty of unsecured credit card options available, they can suit the needs of many different types of consumers. If you’re in the market for a new credit card, here’s how to decide if an unsecured card is right for you.

The Budgeter

If you’re big on budgeting, you can use an unsecured credit card as a tool to help you as you make a budget and stick to it. Many credit issuers offer online statements or apps that can make it easy to track all of your spending right on your phone.

But, if you’re going to use your credit card for all of your spending, make sure to keep the interest in mind. While unsecured credit cards can help you budget, they can also hinder you if you get into the habit of overspending.

The Frequent Flyer

Do you love spending your time on the move? Many unsecured credit cards provide travel rewards that help you earn free travel experiences. For example, some cards can come with reward points or miles that you can use toward booking airfare or accommodations.

You may also receive additional perks like annual hotel credits, access to airport lounges, or discounts on flights when using miles.

The Business Owner

Unsecured credit cards are also useful for business owners. Business owners can capitalize on the perks of unsecured credit cards like rewards, sign-up bonuses, and other benefits. Also, an unsecured card can provide short-term funding for business growth. Plus, it can help businesses build credit for future financing endeavors.

Of course, benefits and terms will vary depending on the type of card you choose.

Typical Requirements to Apply for an Unsecured Credit Card

When you apply for an unsecured credit card, you must meet certain criteria to qualify. Some common requirements when applying for a credit card include:

•   Be at least 21 years of age. While this is generally the age required to get a credit card, if you’re over 18 and can prove you have an income, you may qualify.

•   Provide proof of income to demonstrate you can make the minimum payments.

•   Be a U.S. citizen or have the authority to work in the U.S.

•   Have an acceptable credit score range per the lender’s requirements.

•   Provide personal information such as your name, age, address, Social Security number, and more.

Keep in mind that all credit issuers have different criteria for approval. Some credit issuers may give you the option to pre-qualify. This way, you can see if you may qualify without submitting a hard inquiry on your credit, which can impact your credit score.

The Takeaway

Unsecured credit cards can come with many perks, such as earning cash back rewards and helping you build credit. But, before you apply for just any old card, make sure to compare your options, keeping the average credit card interest rate in mind, and understand the criteria for approval. Identifying an unsecured credit card that’s suitable for your needs might take a little time, but it’s worth it.

Whether you’re looking to build credit, apply for a new credit card, or save money with the cards you have, it’s important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.

FAQ

Is it good to have an unsecured credit card?

If you can handle an unsecured credit card responsibly, it can help you build credit. Also, it can be a good way to receive additional benefits, such as cash back or other rewards, for completing your daily transactions.

What credit score do I need for an unsecured credit card?

Typically, if you have a credit score of 579 or less, credit issuers may be reluctant to approve your application. To qualify for the most competitive rates and offers, you typically want to have a credit score of 670 or higher.

How long before I can get an unsecured credit card?

If you’re working on building credit and don’t qualify for an unsecured credit card, you may have to start with a secured card. But, the amount of time you must use your secured credit card before you graduate to an unsecured time can vary from a few months to several years. Ultimately, it will depend on factors like your current credit score and the criteria of the unsecured credit card you’re applying for.

Photo credit: iStock/Zhonghui Bao

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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Source: sofi.com

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Young aspiring homeowners are increasingly reliant on the bank of mom and dad to help make their purchase, new research finds.

Over a third of Generation Z and millennials who plan to buy a home in the near term are expecting to use, in part, gifts from family to help with a down payment, according to a report by Redfin. The 36% share is twice as large as it was just five years ago, the online real-estate brokerage said. 

In a 2019 millennial-only poll, 18% said they were turning to family for assistance, The portion increased by only 5 percentage points to 23% last year. 

Despite the surge in family support, Gen Z and millennial buyers are also trying to do their part as well in most cases. Approximately 60% of consumers in the same age demographics are regularly saving income to fund a down payment, with 39% also taking on second jobs to help them reach their homeownership goals, Redfin found.

Further down the list of likely funding options was the sale of stock investments, mentioned by 29%, while 22% said they would consider drawing early from retirement funds.   

The rising share of consumers using family gifts for a leg up points to a larger affordability issue that makes even a starter-home purchase beyond reach for many, according to Redfin Chief Economist Daryl Fairweather. 

“Because housing costs have soared so much, many young adults with family money get help from mom and dad even when they have jobs and earn a perfectly respectable income,” she said in a press release. 

“The bigger problem is that young Americans who don’t have family money are often shut out of homeownership. Many of them earn a perfectly good income, too, but they aren’t able to afford a home because they’re at a generational disadvantage; they don’t have a pot of family money to dip into.”

Heightened attention on housing challenges, particularly related to the difficulty in coming up with down payment and closing-cost funding, has turned much of the mortgage industry’s attention toward buyer assistance resources in the past several months. Last year, housing agencies across the country added 135 new programs, a 6% increase from 2022, according to data from Down Payment Resource. 

But consumers are sometimes not fully aware of the benefits offered. To address some of the information gap, Freddie Mac also unveiled a portal last fall to help aspiring homeowners and their mortgage lenders find down payment assistance they might qualify for.

As of January this year, just under 2,300 of such programs were available across the country, provided by a combination of groups, including state housing agencies, municipalities and nonprofits, Down Payment Resource said.

In March, two financial institutions announced their plans to up homebuyer assistance efforts. Atlanta-based Citizens Trust Bank launched a new down payment grant program, offering a maximum of $2,000 to eligible borrowers that can help reduce initial costs of the home purchase. 

Meanwhile, the Federal Home Loan Bank of Chicago said it would increase the amount made available to each of its Midwestern member institutions to $1 million for funding of their own homebuyer grant programs. The new total represents a 43% increase from the 2023 limit of $700,000, while the overall budget for the Chicago bank’s down payment assistance projects is now over $39 million. Eligible first-time mortgage borrowers will have access to up to $10,000 of financial aid when financing through a member bank or their partners.

Despite recent slowing in home price growth, the current level of housing costs is the No. 1 reason young consumers are opting not to buy in today’s market, Redfin said. In its survey, 43% of the segment not in the market cited it as a factor, followed by 34% who said the inability to save for a down payment deterred them. The challenge of keeping up with mortgage payments and perceived high interest-rate levels was each noted by 29%.

Housing affordability looks likely to rise in the public eye this year, with President Biden seemingly ready to make it a talking point during campaign season. In his recent State of the Union address, Biden called for mortgage tax credits, title insurance alternatives and up to $25,000 in down payment assistance in order to help address affordability challenges the country faces.

Housing issues could play a role in the final presidential election result. In a previous Redfin analysis, its researchers found a majority of U.S. households indicating home affordability might influence who they vote for this year. 

Source: nationalmortgagenews.com

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California-based multichannel mortgage lender HighTechLending appointed reverse mortgage industry veteran Brian Boccia to serve as a senior account executive in its third-party origination (TPO) channel. He joins the company after prior experience at companies like Mutual of Omaha Mortgage and Reverse Mortgage Funding (RMF).

Aiming to keep in mind the financial difficulties that seniors may be facing, Boccia expressed a commitment to the reverse mortgage space and a need to understand senior pain points as key elements of his new position. To get a better understanding of all the dynamics in play, RMD sat down with Boccia and Eric Ellsworth, HighTechLending’s executive vice president of national sales.

Coming aboard

After working at RMF for more than nine years, Boccia transitioned to serve as an AE at Mutual of Omaha and helped to add reverse mortgages to the product mix for brokers there. This past month, he joined HighTechLending, along with some of his former colleagues at RMF, including Ellsworth and soon-to-be company co-owner David Peskin.

“With nearly two decades of experience, Brian brings a wealth of knowledge and expertise to our team,” Peskin said in the announcement of Boccia’s hiring.

When asked about the importance of the wholesale division to the overall plan that HighTech has for reverse mortgage business this year, Ellsworth said Boccia is a key player in the plan.

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Eric Ellsworth, EVP of sales at HighTechLending.

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Eric Ellsworth

” data-medium-file=”https://www.housingwire.com/wp-content/uploads/2024/01/ericellsworth_htl.jpg?w=300″ data-large-file=”https://www.housingwire.com/wp-content/uploads/2024/01/ericellsworth_htl.jpg?w=800″ src=”https://www.housingwire.com/wp-content/uploads/2024/01/ericellsworth_htl.jpg?w=800″ alt=”Eric Ellsworth, EVP of sales at HighTechLending.” class=”wp-image-435553″ srcset=”https://www.housingwire.com/wp-content/uploads/2024/01/ericellsworth_htl.jpg 800w, https://www.housingwire.com/wp-content/uploads/2024/01/ericellsworth_htl.jpg?resize=150,150 150w, https://www.housingwire.com/wp-content/uploads/2024/01/ericellsworth_htl.jpg?resize=300,300 300w, https://www.housingwire.com/wp-content/uploads/2024/01/ericellsworth_htl.jpg?resize=768,768 768w, https://www.housingwire.com/wp-content/uploads/2024/01/ericellsworth_htl.jpg?resize=650,650 650w” sizes=”(max-width: 800px) 100vw, 800px”>

Eric Ellsworth

“The wholesale business is a huge part of our strategy coming into 2024,” he said. “David and I had our eye on Brian coming into this year, and we needed to hire somebody that has the customer service skills as well as the industry expertise. Brian has both of those, which we’re really excited about.”

Ellsworth also credits Boccia’s energy as an intangible element that can help lift the entire sales team, he said.

“That’s one of those non-resume things that you can bring to a sales team, an excitement,” he said. “Brian has the ability to elevate that with a team. So, it’s not just his ability to go out and develop relationships with brokers and create business, but just the impact of his energy on the team. We’re really excited about that.”

Customer-centric mentality

For Boccia, dedication to the customer base is key, he explained.

“All that matters is that we’re there for the senior client,” he said. “And that’s what matters to me. I’ve been working with David for 20 years now, so we kind of know each other. I told him I’ll bring knowledge, since I was a broker before I came to the TPO side. I know what it’s like from both sides. So, I feel like that, coupled with my experience of 15 years now doing the AE job, I can bring some energy and, quite frankly, I’m going to make some people laugh.”

Levity helps to keep customers engaged and builds trust, Boccia said.

“I don’t think it needs to be that serious of a situation if we’re all working together and getting the loans done for the senior,” he said. “We’re just trying to help people out. So, I think I’ll bring energy, especially, but maybe also the right frame of mind.”

If someone at the company hasn’t worked as either an AE or broker before, then being able to offer both of these perspectives should be beneficial for people at HighTechLending, he said.

“I can give them both sides of the fence,” he explained. “I’m looking forward to maybe giving them a few tips to help them grow a business. Simple as that — being part of a team.”

The business climate

When asked to explain what the business climate has been like so far this year, Ellsworth said that things started slow before accelerating into March.

“We started off the year with a nice little rate drop, and we were anticipating that this might be a better year. But quickly, those rates started to go back up,” he said. “In January, we saw a little bit of an uptick; it came back down a little bit in February. But I’ll say March is definitely headed in the right direction.”

Ellsworth described more application volume overall in March, which should lead to a good month.

“I was just talking to somebody about it today, and was thinking people are finally realizing that rates are not going to go down anytime soon,” he said. “We might see some rate drops like we saw this past week, and the Fed came out and announced that they’re still anticipating the three rate drops. Whether or not that makes a big, significant impact to the principal limit, I’m not sure.”

But having these conversations openly with borrowers helps to crystallize their understanding of rate dynamics, he said.

The new normal

“I think everybody understands that interest rates are higher than they have been in years past, especially during COVID,” Ellsworth said. “And because of that, I think people are more open to moving forward with a little bit of a higher interest rate than what they could have gotten three years ago.

“It’s really not as big of an issue as it was two years ago. I think it’s just a matter of whether or not somebody qualifies because of the impact that that rate has on the principal limit.”

Boccia said that seniors are being pragmatic based on other costs — especially the cost of living.

“Seniors are more looking at living a healthy retirement,” he said. “We’re in a little bit of a high interest rate environment, but you’ve got to remember something: The line of credit on the HECM grows at the same interest rate at which they’re being charged. So, it’s not all negative. [Some borrowers might] take whatever [they] can upfront, leave something in a line of credit, and have that grow at 7.5% to 8%.”

Source: housingwire.com

Apache is functioning normally

Next time you’re planning a vacation, a travel credit card could defray some or all of the costs if it packs the right incentives. Typically, cards with higher annual fees provide the most value with perks like ongoing rewards, free checked bags, airport lounge access or other benefits. But even cards with low or no annual fees make it possible to earn some value toward travel, if you can qualify.

These cards generally require good credit (scores of 690 or higher), and even if you’re eligible, it’s not worth pursuing one if you can’t pay off the credit card bill in full every month to avoid steep interest charges. And if you’re working toward paying down existing debt, it might not be worth chasing points and miles until you’ve made progress on that front.

But as long as travel credit cards align with your financial goals, their potential savings merit consideration — even if you travel just once or twice per year. Explore the flexibility of a general-purpose travel credit card to book travel anywhere, or a branded credit card to book travel with a favorite hotel or airline. Either option may offer money-saving benefits toward your next trip.

Valuable features can lower costs

Offers will vary among general-purpose travel credit cards and airline- or hotel-branded credit cards, but some savings opportunities may include:

Perks

If a credit card offers a lengthy list of perks, the value can quickly add up. Here are some features to look out for:

  • A sign-up offer: Travel credit cards generally come with lucrative sign-up offers that let new cardholders earn a pile of points or miles by meeting a minimum spending requirement. It’s easier to snag if you can strategically time a credit card application around planned purchases during a heavy-spend month or season.

  • Free checked bags: Some airline credit cards offer free checked bags, which can add up to real savings when applied per person on a round trip. This is one way that Doug Figueroa, a content creator at the YouTube channel Zorito y Doug, makes up the cost of the $150 annual fee on an airline credit card. “The savings are $70 round trip per passenger listed in the same reservation,” he says. 

  • TSA or Global Entry credit: Some travel cards issue a credit (up to $100) when you use them to pay for a TSA or Global Entry application fee. These expedited airport security screening programs can save time while traveling.

  • Travel credits: Depending on the card’s terms, travel credits may be used to save money on a variety of travel expenses like rideshare services, airfare or accommodations. 

  • Airport lounge access: You can skip the pricey airport food with some travel credit cards that offer complimentary airport lounge access. Austin Maxwell, a South Carolina-based content creator at the blog The Maxwells Travel, uses a travel credit card to avoid those costs. “I’m saving $20 to $30 every time I go to the airport because I don’t have to buy food or drinks during a layover or preflight,” he says.

  • A companion ticket: Some airline credit cards cover the cost of a ticket for a friend or family member. Depending on the card’s terms, you may have to pay taxes and fees on the fare, the companion ticket may have an expiration date and/or a spending requirement may apply.

  • Automatic elite status: You may earn elite status without much effort on some hotel-branded credit cards. Elite status can add up to valuable savings if the program offers free food, bonus points or suite upgrades.  

  • Free nights: If your favorite hotel has a branded credit card that offers annual free night awards, it can stretch your vacation budget. 

Protections and other benefits

A travel credit card that offers trip delay or cancellation insurance, lost baggage insurance, rental car coverage or other protections may also be of value to you. To qualify for these benefits you typically need to pay for the trip or covered purchase with the eligible credit card. Read the terms carefully to understand the extent of your coverage.

Figueroa says he saved $90 over three days with his card’s primary rental car coverage on a trip to Miami.

“Once you make the online reservation, you must decline all insurance offered by the rental company and pay for everything with your [card],” he says.

High-value reward redemptions

Points or miles on some travel credit cards might lose value if they are used for non-travel redemptions like cash back, gift cards or other options. Travel redemptions typically offer the best value, and you might squeeze out even more value with a general-purpose travel card that allows points to transfer to airline or hotel partners. It’s a strategy that Maxwell uses often to his advantage.

“It’s even better if there’s a transfer bonus associated with that,” he says. “Credit card companies offer transfer bonuses — 15%, 20%, 30% bonus — if you are to transfer points to a specific airline.”

He says he has also transferred points to hotel partners to book hotel rooms with them. “It would be the equivalent of getting a hotel room at $120 that’s actually valued at $500,” he adds.

To determine whether to redeem rewards for travel or transfer them to a partner, compare costs by checking the credit card’s booking platform and the partner’s website. Also factor in whether rewards transfer on at least a 1:1 ratio, meaning that you’ll get the equivalent value in points or miles transferred.

Source: nerdwallet.com