Since
my son and I are soon driving south into Virginia and the Carolina’s
on a trip, I have been paying attention to travel news. I see that
Boeing
unveiled its latest airplane, the 787 Dreamliner. Boeing says the
Dreamliner is
a lighter more durable airplane that will allow passengers to sit
comfortably
on the runway for hours and hours. On top of that, a United flight from
Seattle
to San Francisco made an emergency landing after a row of seats gave
way and
slid into the row behind it. United is taking immediate action and has
added a
twenty dollar surcharge for passengers who want non-collapsible seats.
(No, I
wasn’t clever enough to make those up by myself…)
What
do employees of Federal Reserve Banks do all day? Sometimes
they put out cool articles about mortgage banking that begin with, "On
close inspection many of the most popular explanations for the subprime
crisis
turn out to be myths. Empirical research shows that the causes of the
subprime
mortgage crisis and its magnitude were more complicated than mortgage
interest
rate resets, declining underwriting standards, or declining home
values."
http://www.clevelandfed.org/research/commentary/2009/0509.pdf
Have
you heard the news? We're out of the recession! (At least until the
next time the market wants to focus on negative news.) Existing
Home Sales rose
for three months in a row, while foreclosure sales and the glut of
homes on the
market both declined. Interestingly, prices rose during that period in
about
half of those areas, but year over year prices are down about 15%.
Foreclosures
and short sales made up 31% of the sales in June. Lastly,
nationwide there is about a 9.4 month
supply of inventory out there waiting to be sold.
How
about the debt to be sold next week to fund the government? $42
billion in 2-yr notes, $39 billion in 5-yr notes, $28 billion in 7-yr
notes,
not to mention $96 billion in other instruments. Yowza! Where’s my
checkbook?
Anyway, the only news due out today is the University of Michigan
Consumer
Sentiment Survey. Rates have, overall, been pretty quiet all week. This
morning, soon after the open, the 10-yr yield is 3.67% and mortgage
security
prices are slightly better than Thursday afternoon.
As
far as investor news goes:
Wells Fargo correspondent came out with their Reg Z/MDIA information,
which takes effect on July 30th. Similar to everyone else’s,
“The
initial or early Truth-in-Lending (TIL) disclosure must now be provided
to the
borrower for all closed-end transactions, regardless of the loan
purpose or
lien position. This includes but is not limited to purchase money loans
and
refinances; first lien and subordinate lien loans; and principal
dwellings as
well as second homes…. Include the language ‘YOU ARE NOT REQUIRED TO
COMPLETE
THIS AGREEMENT MERELY BECAUSE YOU HAVE RECEIVED THESE DISCLOSURES OR
SIGNED A
LOAN APPLICATION.’, etc.
PNC Financial Services, which is where National City ended
up
late last year, will consolidate more than 90 National City mortgage
processing
operations into two (located in Pittsburgh and Chicago). They will
retain their
residential mortgage servicing operation in Miamisburg, Ohio. This is
certainly
good news for any unemployed mortgage folks in Pittsburgh and Chicago,
but how
about the 3,693 employees of National City’s mortgage processing
operations?
Speaking
of PNC, their residential mortgage banking channel earned
$88 million in the second quarter 2009, down from $221 million in the
first
quarter. Why the drop? “Lower net mortgage servicing rights hedging
gains” and “reduced
loan sales revenue” were the culprits. They funded $6.4 billion, and
their nonperforming
assets as of June 30 increased to $4.5 billion, up $1 billion from the
first
quarter.
And
while we’re talking earnings for the 2nd quarter, mortgage
banking net revenue at Fifth Third Bancorp (in Cincinnati) was up 72%
over the
same quarter last year, $147 million vs. $86 million. They funded a
record $6.9
billion, up from $4.9 billion for the first quarter 2009. As a result,
Fifth
Third had gains on mortgages sold of $161 million, and sold off some
portfolio
loans to make another $1 million. On the negative side, the MSR
valuation
adjustment, including mark-to-market of hedges, was a loss of $16
million, and
they took a net charge off of $626 million for losses related to
commercial and
residential real estate loans in Michigan and Florida.
GMAC Bank Correspondent clients should know that after today,
Correspondent Funding will no longer be accepting new submissions via
Genworth's AU Central portal.
A
Catholic priest and a nun made plans to take the afternoon off and
enjoy a round of golf. The priest stepped up to the first tee and took
a mighty
swing.
He
missed the ball entirely and said, "Damn, I missed."
The
good Sister told him he needed to watch his language.
On
his next swing, he missed again. "Damn, I missed."
"Father,
I'm not going to play with you if you keep swearing,"
the nun said tartly.
The
priest promised to do better and the round continued.
On
the 4th tee, he misses again. The usual comment followed.
Sister
is really disgusted now and says, "Father John, God is
going to strike you dead if you keep swearing like that!"
On
the next tee, Father John swings and misses again. "Damn, I
missed."
Suddenly
a terrible rumble is heard and a gigantic bolt of lightning comes
out of the sky and strikes Sister Marie dead in her tracks.
And
from the sky comes a booming voice... "Damn, I missed!"
Rob
(For
archived
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