Bernie Madoff and his wife are saying they have $69 million that is theirs and is not part of the money he swindled. They say it's money he saved by switching to GEICO. HA!

In all seriousness, I apologize for not getting these daily updates out this week. As you can imagine, we have been pretty busy here at RPM mortgage. Lock desks everywhere have seen a welcomed pickup with application volume up 11%. (+13% for the REFIS and +7.1% for the PURCHASES).

I have several clients calling about the stimulus package and how it may apply to them. Seems like everyone wants a ride on the Obama bailout express. The most common question is “How do I know if my mortgage is owned by Fannie Mae of Freddie Mac?” Since these institutions function primarily as a secondary market, your mortgage statements could be coming from Bank of America, Chase, Countrywide, Wamu, or any other of a hundred different mortgage “servicing” companies. So how can you find out?

Simple:
http://www.fanniemae.com/homepath/homeaffordable.jhtml
https://ww3.freddiemac.com/corporate/

Other cool links…

Here’s everything that you wanted to know about TALF but was afraid to ask: http://www.newyorkfed.org/markets/talf_faq.html
And here’s everything you wanted to know about how the stimulus activity impacts your state: http://www.stimuluswatch.org/project/by_state
And lastly, Countrywide (“Countryfine”) gets a little publicity in the Simpson’s. http://www.hulu.com/watch/61224/the-simpsons-no-loan-again-naturally

In other news…

Several American banks, including Goldman Sachs and Wells Fargo, are “mulling” the return of bailout funds they received because of the growing number of strings the federal government is attaching to the money. And it is already happening: the Signature Bank of New York informed the Treasury Department the bank will give back $120 million it received from the government, due to executive pay caps. Bailout funds include caveats about executive compensation, the postponement of evictions, modification of mortgages for troubled home loan borrowers, reduction of dividends, cancellation of employee training and morale-building events, and the withdrawal of job offers to foreign workers.

RealtyTrac, who tracks foreclosures and hasn’t seemed to put forth good news for a few years, released its report for February. Default notices, auction sale notices and bank repossessions went above 290,000, an increase of 6% from the previous month and an increase of nearly 30% from February 2008. The top states were Nevada (1 in 70 in foreclosure), Arizona (1 in 147), and California (1 out of 165). Rounding out RealtyTrac’s Top 10 were Florida, Idaho, Michigan, Illinois, Georgia, Oregon and Ohio, but on average 1 in every 440 U.S. housing units received a foreclosure filing in February. In spite of many investors putting foreclosures on a temporary halt, according to their spokesman there were some exceptions. For example, a 45-day voluntary moratorium in Florida expired at the end of January, and foreclosure activity there was up 14% from the previous month. In New York foreclosure proceedings delayed by a new law for an extra 90 days appear to have hit the system in February, when the state’s foreclosure activity increased 23% from the previous month.

Come next Monday, Radian will have a different set of guidelines that apply to all markets as Radian is retiring their Declining Markets policy. (For Radian, markets will no longer be classified as stable or declining.) The changes include a Maximum LTV - 90%, Maximum Loan amount - $417,000, Minimum Fico Score – 720, Maximum DTI- 41% (Regardless of AUS decision), and Occupancy- Primary Residence, 1 Unit Only. Ineligible Property types include Attached Condo’s, Attached PUD’s, Construction- to-perm, Interest Only, and Cooperatives or Manufactured housing. And speaking of MI companies, the credit-ratings agency Fitch Ratings placed mortgage insurer MGIC Investment Corp. and its operating subsidiaries on a “negative watch”. A downgrade to junk status could further hinder the insurer's ability to generate new business, and the downgrade occurred after MGIC said it said it would defer interest payments on $390 million in junior subordinated debt. The deferral is further indication of the increasing financial pressure on the company and the entire MI industry. For “good news”, Fitch noted that MGIC has enough liquidity to meet immediate financing needs. (If it is any consolation, Fitch also downgraded Berkshire Hathaway Inc.'s AAA issuer default rating and senior unsecured debt ratings by one notch, saying “a top rating isn't appropriate for financial-oriented holding companies in the current volatile market”.)

Have a great weekend!

Ryan Ogata
Senior Mortgage Consultant