OFHEO, who oversees FNMA and FHLMC, are expected to announce the 2008 loan limits soon after Thanksgiving. Federal regulators are proposing to leave the conforming loan limit for single-family homes at $417,000 in 2008, and possibly raising California’s and New York’s, regardless of how steeply housing prices fall this year. Last year they left the limits the same in spite of a decline in the average home price, although they said then that they would lower the limits if we saw another year of decline. The National Association of Realtors projects the national median price of existing homes will fall by 1.3% in 2007. (The survey includes lenders making conventional, single-family, fully amortized, purchase-money loans and excludes FHA-insured and VA-guaranteed mortgages, refinancing loans, and balloon loans.)

Wells Fargo improved their jumbo fixed rate pricing again.  This is the third iteration in the last several weeks as the improvement in the market continues, and Wells also increased their rebate pricing.

CitiMortgage announced the removal of their 3/1 ARM (“effective October 13, 2007, the 3/1 LIBOR and T-Bill ARMs will no longer be eligible products under the Agency Alt A SIVA, Agency Alt A SISA, Agency Alt A NIVA, or Agency Alt A NINA programs”), increased minimum FICO levels on their Alt products to more closely match the industry’s, and discontinued SIVA product for all Second Lien/Home Equity products.

Countrywide announced mortgage loan fundings for the month of September 2007 totaled $21 billion, a 44% decline from September 2006. Average daily mortgage loan application activity for September 2007 was $1.7 billion, a 39% decrease from September 2006, and the mortgage loan pipeline was $42 billion at September 30, 2007, as compared to $65 billion for the same period last year.

Mortgage applications in the U.S. rose 2.4% last week, as purchases gained for the first time in three weeks and refinancing rebounded. The purchase index rose 2.1% and its refinancing gauge moved up 2.7%. Today we had weekly Jobless Claims drop 12k to 308k, painting a stronger-than-expected employment picture, and the August Trade Deficit come in less than expected at $57.6 billion. Later today the Treasury will sell $6 billion of 10-yr inflation indexed notes (TIPS). Note that there are three reports scheduled for release tomorrow, with two of them being very important to the markets and mortgage pricing: September’s Retail Sales and the Producer Price Index (PPI) reports. They can create a great deal of volatility in the markets and mortgage rates, so please be prepared to see movement in rates Friday. But for now, mortgage prices are slightly worse and the 10-yr yield is up to 4.69%.

With all the new technology regarding fertility, recently a 65-year-old woman was able to give birth to a baby. When she was discharged from the hospital and went home, her relatives came to visit.

"May we see the new baby?" one asked. "Not yet," said the mother. "I'll make coffee and we can visit for a while first." Thirty minutes had passed, and another relative asked, "May we see the new baby now?" "No, not yet," said the mother.

After another few minutes had elapsed, they asked again, "May we see the baby now?" "No, not yet," replied the mother. Growing very impatient, they asked, "Well, when can we see the baby?"

"WHEN HE CRIES!" she told them.

"WHEN HE CRIES?" they asked. "Why do we have to wait until he cries?"

"BECAUSE I FORGOT WHERE I PUT HIM!”