The Mainstream Media Is Building Mortgage Market Awareness (And That’s A Good Thing)

• Tweet

First Business anchor Tom Hudson asked for commentary on the recent mortgage market volatility.  The four-minute spot above is the result. 

We did keep our eyes open wide for most of the conversation despite the screenshot above.

Tom and I covered a handful of important mortgage lending topics, many of which won't be new to regular readers of The Mortgage Reports:

• How quickly mortgage rates are changing from day-to-day (and inter-day)
• Why drops to the Fed Funds Rate usually lead to increases in mortgage rates
• Why homeowners should be aware of their mortgage terms
• How changing mortgage guidelines are impacting homeowners
• Why mortgage applicants should expect long underwriting turntimes

In addition to First Business, I also spoke with Mary Umberger at the Chicago Tribune last week for two stories.

The first article talks about the current "refi boom" and compares it to the activity of mid-2002 through late-2003.  Earlier this decade, mortgage guidelines were expanding and with each subsequent drop in mortgage rates, more homeowners were able to participate.

Today, it's the opposite.  Mortgage lending standards are contracting and a much smaller set of homeowners is able to take advantage.  Despite that, remortgage applications are soaring.

The second article is about homeowners whose mortgage applications are being denied because their home was recently listed for sale. 

Mortgage lenders are saying "no" to homes that were "on the market" because it's considered a loan of "desparation".  As in, "you couldn't sell your home, and now you're desparate for a bailout".

Most lenders institute a 90-day cool-off period although for some that period is more, and some it is less.

This isn't a new policy, of course.  It just wasn't a factor several years ago when many homes listed for sale sold in short order.