Monthly Archives: May 2020

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The Sun Also Rises For Housing and Mortgage Markets

May 22, 2020 2:54 PM ET

There’s no shortage of bad news when it comes to the economy and the housing market. But that’s no surprise considering the circumstances. 

The sheer size and speed of the economic contraction makes it easy to worry about what the future will look like.  Has coronavirus changed things forever?  Is it true that many jobs have been permanently destroyed?

I don’t know.  No one can really know.  Many of the more troubling questions won’t be able to be answered any time soon.  No one can deny things are bad and that some things may stay bad for a long time.

But hidden amid the understandable sea of pessimism, there are some reasons for hope.  We’re not talking about the kind of hope that makes us complacent to the ongoing economic risks.  Rather, there are simply some positive counterpoints to the abundant negativity in the recent data.  Let’s look at both sides!

April’s Existing Home Sales numbers were released on Thursday, and they easily fell to the lowest levels in years.  There’s not much of a silver lining here apart from the fact that economists expected the number to be even lower.

20200522 NL6

The Existing Home Sales report doesn’t capture activity in new construction.  For that, we have to turn to other data released this week on new building permits and housing starts (the ground-breaking phase of new construction).  Here too, things are quite a bit weaker, but the differences between “starts” and “permits” offer a clue.  Specifically, the bigger drop in housing starts suggests quarantine measures are physically preventing new home construction to a greater degree than a lack of demand. (read our complete post)

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FHFA sheds light on an important question regarding the forbearance program

What was this important question?
Can a borrower refinance or purchase a home after needing to use the forbearance program?

In March of this year the government initiated the forbearance program to allow people to postpone making their mortgage payments. The program did not address an important question regarding how to qualify borrowers with loans that are in or had been in forbearance. This week the FHFA, which regulates Fannie Mae and Freddie Mac, shed some light on this question. It announced that borrowers in the forbearance program and those who have left it may now refinance or purchase a home with a new mortgage. The main condition to qualify is that the borrower must have made at least the last three consecutive months of payments. Previously the guideline required the borrower to be current on their mortgage for at least a year, or have repaid the full amount of any payments missed.  

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Coronavirus Market Alert

  COVID-19 Updates  

Interest rates are back down to the historic lows seen in March before the Coronavirus’s (COVID-19) pandemic effect on the market.

Although, interest rates on certain programs have been affected by the Coronavirus (COVID-19) and the temporary status of certain programs change with current market conditions, it is recommended to have a game plan put together if your loan program is one of these affected and rates have not recovered yet.

See my weekly newsletter at for in depth market information.

Please reach out to me to take advantage of today’s low rates or with any questions you may have.

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May 2020