• Citi Home Equity wholesale sent out a notice to brokers saying that after today they would no extend loans on purchase money transactions in California.
• Do you broker to ING? Good luck finding a wholesale rep, as they’ve all reportedly been laid off. One rep sent this out: “I am very sad to say that ING has decided to let go of all the Account Executives at this time. I'm not sure who your point of contact will be as they are moving more towards a call center like environment.”
• The PMI Group, Walnut Creek, Calif., has reported a net loss of $86.8 million in the third quarter, three quarters of which stemmed from its U.S. mortgage insurance operations.
• Chase Home Equity, effective Nov 12th, is changing their guidelines: “Max 90% CLTV in all states. (Already 90% CLTV in CA)  Purchase and Refi, (except Nevada, still capped at 85% CLTV), elimination of all stated income transactions (SIVA and SISA), etc. And December could possibly see reduced DTI levels and changes to loan amounts and non-owner guidelines.
• Wells Fargo just sent out a notice that they are raising the add-on for CLTV's higher than 80% to 1.50!!

Bloomberg reported that the default rate on collateralized debt obligations, given the highest credit rating of AAA less than two years ago by Fitch Ratings and backed by subprime mortgage securities, was underestimated by their analysts. Fitch put almost $24 billion of top-rated CDOs on review for downgrade, all carrying a AAA rating that denotes what the company defines as the ``the lowest expectation of credit risk.'' Fitch reserves AAA ratings for securities with an “exceptionally strong capacity'' to pay commitments on time. Fitch, a unit of Paris-based Fimalac, said it may downgrade 150 transactions worth $36.8 billion. About $4.2 billion had already been under review. The company said it examined all 431 structured finance CDOs, representing $300 billion.

Back to the markets… yesterday Consumer Confidence for October was released and dropped to its lowest level in two years driven by the sagging housing market and higher gas prices. Although the market didn’t move much, this morning we’re a little worse and the yield on the 10-yr is up to 4.42%. At 11:15AM PST (2:15 EST) the FOMC will announce the rate decision following their 2-day meeting. It is fully expected that the target Fed Funds rate will be lowered by 25 basis points to 4.5%, but the market will be carefully eying the post-meeting statement to look for updates on inflation and the broader economy and to get any clues to any further loosening of monetary policy.

You know that you’re too old to trick & treat when

• You get winded from knocking on the door.
• You have to have another kid chew the candy for you.
• You ask for high fiber candy only.
• When someone drops candy in your bag, you lose your balance and fall over.
• People say “great mask” and you’re not wearing one.
• When the door opens and you yell, “Trick or…” and can’t remember the rest.
• By the end of the night you have a bag full of restraining orders.
• You chose a costume that won’t dislodge your hairpiece.
• You’re the only Power Ranger in the neighborhood with a walker.
• You keep having to go home to piddle.