Mortgage
Former IndyMac CEO sued by FDIC for an astonishing $600 million
FDIC cleaning house
In May 2011, the Federal Deposit Insurance Company’s (FDIC’s) started cleaning house and filing lawsuits. They filed against CoreLogic for $129 million alleging faulty appraisals provided to Washington Mutual Bank (WaMu) which the FDIC seized in 2008 prior to facilitating its sale to JPMorgan Chase.
CoreLogic’s competitor Lender Processing Services (LPS) was filed against by the FDIC for $154.5 million alleging negligence and breaches of contract leading to WaMu losses.
IndyMac CEO sued for $600 million
With the sizable organizations of LPS and CoreLogic being sued for $129 million and $154.5 million respectively, $600 million sounds drastic in comparison, but that is the amount named in the suit filed in the Central District of California District Court by the FDIC against former IndyMac CEO Michael Perry.
The FDIC has deemed that one person is nearly six times more financially responsible than alleged fraud that is being pointed to by some analysts as the source of the mortgage crash.
The suit cites damages of $600 for the sale of toxic mortgages as Perry allegedly knew the secondary mortgage marketplace was unstable yet allowed IndyMac to “generate and purchase approximately $10 billion in loans for sale” in the secondary market.
The bank was incapable of selling the loans, adding more than $600 million in losses which is the source of the suit amount, according to the FDIC.
IndyMac, formerly Countrywide Mortgage
IndyMac Bank was founded as Countrywide Mortgage Investment in 1985 by David S. Loeb and Angelo Mozilo until 1997 when IndyMac became its own company run by Perry since its founding. IndyMac was known as the largest supplier of stated-income home loans.
Ultimately, it was shut down by the FDIC three years ago this month, closing with $13 billion in losses. The FDIC beared most of the losses which is why they are seeking a nearly unprecedented recovery amount from any executive. Perry’s lawyers maintain his innocence.
Now, the bank is operating and turning a profit as OneWest Bank and is being run by hedge fund billionaires.
Mortgage
Mortgage application volume falls 8.1 percent in one week
Mortgage application volume fell last week, even accounting for the federal holiday, as certain interest rates jumped up a bit in the same period.
Mortgage application volume took a dip last week
According to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending January 25, 2013, mortgage application volume fell 8.1 percent from the week prior, including adjustments to account for the federal holiday.
The Market Composite Index, a measure of mortgage loan application volume, decreased 8.1 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 17 percent compared with the previous week. The Refinance Index decreased 10 percent from the previous week.
The seasonally adjusted Purchase Index decreased two percent from one week earlier. The unadjusted Purchase Index decreased six percent compared with the previous week, but was two percent higher than the same week one year ago.
The refinance share of the mortgage application volume fell to 79 percent of total applications from 82 percent the previous week, continuing to hover around 80 percent where it has been for years. The adjustable-rate mortgage (ARM) share of activity increased to 4 percent of total applications. The HARP share of refinance applications increased to 26 percent from 25 percent the prior week.
The MBA reports, “The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances rose to 3.67 percent, the highest level since September 2012, from 3.62 percent, with points decreasing to 0.42 from 0.43 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The contract interest rate for 30-year fixed mortgages has increased for six of the last seven weeks. The effective rate increased from last week.”
Current average contract interest rates
According to the MBA:
- The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) increased to 3.95 percent from 3.85 percent, with points increasing to 0.39 from 0.34 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
- The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 3.48 percent from 3.40 percent, with points decreasing to 0.33 from 0.53 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
- The average contract interest rate for 15-year fixed-rate mortgages increased to 2.95 percent from 2.87 percent, with points decreasing to 0.38 from 0.39 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
- The average contract interest rate for 5/1 ARMs decreased to 2.60 percent from 2.61 percent, with points increasing to 0.33 from 0.32 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
Mortgage
Mortgage application volume surges in second week of 2013
Mortgage application volume in the second week of the year jumped, led by new mortgage applications, a healthy sign for housing and buyer interest.
Mortgage application volume jumps in January
According to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending January 11, 2013, mortgage application volume increased 15.2 percent from one week earlier, led by a strong increase in new mortgage applications.
The Market Composite Index increased 15.2 percent on a seasonally adjusted basis from the week prior, and on an unadjusted basis, the Index increased 45 percent during the same period as the Refinance Index increased 15 percent from the previous week.
The seasonally adjusted Purchase Index increased 13 percent from one week earlier to the highest level since April 2011. The unadjusted Purchase Index increased 47 percent compared with the previous week and was 5 percent higher than the same week one year ago.
The refinance share of mortgage activity remained unchanged at 82 percent of total applications from the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 3 percent of total applications.
Current mortgage interest rates
According to the MBA:
- The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) remained unchanged at 3.61 percent, with points decreasing to 0.38 from 0.41 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate decreased from last week.
- The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) increased to 3.88 percent from 3.78 percent, with points unchanged at 0.38 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
- The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 3.39 percent from 3.35 percent, with points decreasing to 0.58 from 0.69 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
- The average contract interest rate for 15-year fixed-rate mortgages remained unchanged at 2.88 percent, with points decreasing to 0.27 from 0.39 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
- The average contract interest rate for 5/1 ARMs increased to 2.66 percent from 2.64 percent, with points decreasing to 0.34 from 0.37 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
Housing News
Fiscal cliff uncertainty means new low for mortgage rates
While mortgage rates have remained low in recent years, mortgage application volume rose last week as rates hit a new low, resulting from uncertainty over the fiscal cliff, according to the MBA.
Mortgage rates hit new low, application volume rises
According to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending December 7, 2012, mortgage application volume increased 6.2 percent from the previous week, with an 8.0 percent increase in refinance applications and a 1.0 percent increase in new mortgage applications.
“Continued uncertainty due to the lack of resolution regarding the fiscal cliff led interest rates lower last week, with mortgage rates reaching a new low in our survey,” said Mike Fratantoni, MBA’s Vice President of Research and Economics.
“Refinance activity increased,” Fratantoni said in a statement, “with the refinance index hitting its highest level in two months, and the refinance share reaching its highest level since January 2009. Applications for purchase increased for a fifth consecutive week, and are running almost ten percent above their level at this time last year.”
The refinance share of mortgage activity increased to 84 percent of total applications from 82.0 percent the previous week, while the adjustable-rate mortgage (ARM) share of activity remained at 3.0 percent of total applications. The HARP share of refinance applications increased to 29.0 percent from 27.0 percent the prior week.
Current mortgage rates
According to the MBA:
- The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) decreased to 3.47 percent, the lowest rate in the history of the survey, from 3.52 percent, with points decreasing to 0.36 from 0.41 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate decreased from last week.
- The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) decreased to 3.77 percent from 3.79 percent, with points increasing to 0.35 from 0.32 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
- The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.32 percent, the lowest rate in the history of the survey, from 3.34 percent, with points decreasing to 0.51 from 0.62 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
- The average contract interest rate for 15-year fixed-rate mortgages decreased to 2.85 percent, the lowest rate in the history of the survey, from 2.86 percent, with points decreasing to 0.26 from 0.27 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
- The average contract interest rate for 5/1 ARMs increased to 2.63 percent from 2.62 percent, with points decreasing to 0.34 from 0.40 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
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Mike Cover
July 11, 2011 at 5:55 am
Funny thing is we still have no doc and stated income loans to 65%, in several states (not hard money). Also, no cap on cash out for oo and noo, all property types, trusts, LLC, cops ok…etc. Great unique program through our private banking relationships.
Greg Cook
July 11, 2011 at 2:58 pm
So, let me get this straight.
CoreLogic sues NAR for inflating home values and home sale numbers and is now being sued for faulty appraisals?
They should certainly win their suit against NAR, they know all about inflating values.