BB&T Corporation (NYSE: BBT) and The Bank of Kentucky Financial Corporation (NASDAQ: BKYF) announced today the signing of a definitive agreement under which BB&T will acquire The Bank of Kentucky in a cash and stock transaction for total consideration valued at approximately $363 million. This acquisition will establish a presence for BB&T in the Northern Kentucky / Cincinnati market. (more…)
More than six in 10 millennials (63%) do not have a credit card, according to a new Bankrate.com (NYSE: RATE) report. Comparatively, only 35 percent of adults 30 and over have zero credit cards in their wallets.
Millennials are the least likely of any age group to pay their balances in full each month. Only 40% of millennials pay their entire balance every month, compared to 53% of adults 30 and older. Three percent of millennials admit to often missing payments completely, more than any other age group. (more…)
While, on average, Canadian house prices have climbed five per cent in 2014, a new report from CIBC World Markets finds that price increases in mid- and high-priced homes are far outpacing those of lower-priced ones, which is making it increasingly more difficult for many Canadians to move up out of their starter homes.
“The value of bigger and pricier properties is rising notably faster than less expensive properties—widening the gap between starter home and dream house,” says Benjamin Tal, Deputy Chief Economist at CIBC. “Regardless of what your starting point is, and by how much your property has appreciated, the desired move up target is getting further and further out of reach.”
He notes that, historically, most Canadians followed a well-known narrative. “You graduate from school, land your first job, get married, buy your first house, start a family, and after a number of years, move up to a larger house to accommodate your growing family.”
“However, there are many indications that this cycle that dominated the Canadian housing market for decades, is breaking,” he points out.
The report shows that, in Toronto, the price of homes in the $300,000 to $500,000 range rose, on average, about 28 per cent between the first quarter of 2010 and the first quarter of 2014. However, homes priced between $800,000 and $1.2 million jumped over 40 per cent and homes priced between $1.2 million and $1.6 million shot up better than 50 per cent in the same period.
That means the family that paid $500,000 for a house in 2010 has seen their home value climb to about $640,000, a tidy $140,000 increase in value. The problem is the $800,000 home they want to move into has jumped by more than $300,000 to $1.12 million. It’s a similar situation in other urban centres, including Ottawa, Calgary and Edmonton, where the move up category has risen notably faster than the start-up category.
In Vancouver, with the highest prices in the country, that gulf is even wider. Homes that sold for $500,000 to $800,00 have increased by only a few percentage points whereas homes prices at $1.1 million and higher have jumped by close to 18 per cent. The gap between these homes has grown by close to $200,000 in the last four years.
Mr. Tal notes that while, on the surface, the volume of house resale activity in Canada looks stable – with unit sales fluctuating between 35,000 and 40,000 units per month since 2010 – it is anything but. “This apparent stability masks a more complex story,” he says. “Sales of units at the low-to-mid price range fell notably since 2010. Sales rose modestly for the mid-to-high price range, and advanced rapidly for units in the upper end of the market.
“This picture of soft sales at the low-to-mid price range of the single-detached market has affordability written all over it. Tightening mortgage regulations in general, and the reduction in amortizations from 40 years to 25 years for high-ratio mortgages in particular, alongside rising prices worked to price out many first-time homebuyers that dominate activity in this price range.”
He found that the homeownership rate among Canadians aged 25-35 (first-time homebuyers) has fallen from 55 per cent in 2012 to the current 50 per cent. For those over the age of 35, the homeownership rate remained stable.
There is also a big difference between markets with sales and price increases increasingly being driven by activity in the country’s large and pricy cities. Conversely, we’ve seen prices fall in Saint John, Québec City and Victoria in the last year and overall more than one-fifth of sales are now in cities that see prices rising by less than the current rate of inflation.
Homeowners in many of Canada’s larger cities that can’t afford a larger home – or won’t get into bidding wars – are increasingly recognizing they will be in their first home for longer than expected. “With limited move up options, it’s no surprise then that many Canadians choose to renovate their existing homes,” says Mr. Tal.
“Over the past five years, spending on home renovations as a share of total residential investment averaged close to 46 per cent—by far the largest share on record. Renovation activity will remain robust and, in fact, might accelerate in the coming years.”
Mr. Tal says that while home values will be tested when interest rates rise, the asymmetrical nature of the market, the stabilizing role played by the condo market in major urban centres – which is providing a cheaper alternative to single-detached units – and the significant constraints on land availability may all work to limit the damage.
The complete CIBC World Markets report is available at: http://research.cibcwm.com/economic_public/download/if_2014-0908.pdf
Headquartered in Irvine, Calif., HighTechLending, Inc., a rapidly growing FHA Full Eagle Regional Mortgage Bank with three platforms, Retail, Wholesale, Reverse providing Conventional, FHA, VA and Reverse residential mortgages across multiple states and specializing in modern technologies and paperless loan process, announced David Smith as its newest Vice President of Operations, a mortgage industry veteran with 20 years of products, pricing and risk management experience.
Previously with Clear Vision Funding, Smith served as their Senior Vice President of Operations. He directed all facets of mortgage operations including compliance, underwriting, and all closing and funding areas. He managed implementation of mortgage operating risk functions; established processes, tools, and systems to identify, analyze, measure, and monitor operating risk in mortgage business. He also assisted in the dramatic increase in company volumes in wholesale transactions; since joining company, originations have totaled $3.2B.
Prior to Clear Vision Funding, David Smith served as executive vice president of Medallion Mortgage Corporation and held several wholesale loan trading and credit risk management positions. Erika Macias-White, SVP and Chief of Operations, featured in June’s MPA Magazine’s edition of Elite Women of Mortgage 2014, says “David’s risk management experience will be invaluable to us during this time when ongoing regulations and compliance is at an all-time high.” She added, “He will add maximum profitability and provide enormous operational efficiencies and quality in leveraging HighTechLending, Inc.’s guaranteed 5 star service.”
Featured in this month’s MPA Magazine, as one of the six leading experts in reverse mortgages, President of HighTechLending, Inc. and Past President of C.A.M.P Orange County, Don Currie, says, “David is ready for this exciting challenge and will be a valuable asset and addition to our team as we continue our trajectory of growth where our team is continually focused on dedication to customer service and providing operational efficiency.”
Tiptree Financial Inc. has recently completed its previously announced strategic transaction with Luxury Mortgage Corp. Under terms of the related transaction agreements Tiptree has acquired a majority interest in Luxury Mortgage and its previously funded senior secured term loan remains outstanding.
Luxury Mortgage expects to use the proceeds of the investment to expand operations through additional origination channels such as retail expansion and a new correspondent channel which will focus on acquiring prime credit jumbo loans. With Tiptree’s support, Luxury Mortgage will also pursue expansion opportunities through strategic alliances and strategic acquisitions in existing and new markets.
Michael Barnes, Executive Chairman of Tiptree, and Geoffrey Kauffman, CEO of Tiptree, joined Luxury Mortgage’s Board of Directors in connection with the transaction
To support the growth in its consulting sales and delivery activities, today RiskSpan President and CEO Bernadette Kogler announced the hiring of Brad Davis as Managing Director. (more…)
Trez Capital Senior Mortgage Investment Corporation (the “Company” or “Senior MIC”) announced today that the net proceeds from its Initial Public Offering (“IPO”) have been fully deployed in 22 Canadian first mortgage loans. (more…)
Mayflower Bancorp, Inc. (NASDAQ Global Market: MFLR), the holding company for Mayflower Bank, today reported net income of $297,000 or $0.14 per share the fourth quarter ended March 31, 2013, compared to earnings of $224,000 or $0.11 per share for the two-month period ended March 31, 2012. The diluted earnings per share were $0.14 and $0.11 respectively. (more…)
AllRegs will publish Norcom Mortgage’s lending library of mortgage underwriting guidelines. Norcom Mortgage is going to leverage the AllRegs technology platform and publishing expertise to manage and maintain their retail and correspondent lending library of mortgage underwriting guidelines. (more…)
Thanks to historically low interest rates, American homeowners paid almost 37 percent less per month in mortgage payments in the fourth quarter compared to pre-housing-bubble norms – even as homes themselves cost 14.5 percent more in the fourth quarter compared to historic averages relative to U.S. median incomes, according to leading online real estate marketplace Zillow®.
Zillow analyzed current and historic median home values as determined by the Zillow Home Value Index[i], and median income data from the U.S. Census and the Bureau of Labor Statistics, for more than 240 metro areas nationwide and the U.S. as a whole. Researchers used this data to calculate both an affordability index[ii] – measuring the portion of monthly income homeowners spend on mortgage payments – and a price-to-income ratio[iii], analyzing how much homes cost overall compared to annual incomes. (more…)
The February Mortgage Monitor report released by Lender Processing Services (NYSE: LPS) found an increase in loan “cure” rates (those loans that were delinquent in the prior month and are now current). The majority of cures were on loans one-to-two months delinquent, with approximately 500,000 loans curing in February alone. As LPS Applied Analytics Senior Vice President Herb Blecher explained, these cures were not unusual, but rises seen in loans three-to-five months delinquent and foreclosure-initiated categories were unexpected. (more…)
Genpact Study: New Regulations and the Economy Act as Catalysts to Drive Streamlining of Processes in the Mortgage Industry
A study sponsored by Genpact Limited (NYSE: G), a global leader in business process management and technology services, has found that new regulations and a challenging housing recovery environment will require mortgage providers to improve and streamline processes in the mortgage lending lifecycle. The research sought to determine key challenges and priorities facing the mortgage industry by surveying banking and mortgage professionals about their current and planned workflow technology solutions and processes, in addition to the systems used by loan servicers throughout the loss mitigation cycle. (more…)
The October Mortgage Monitor report released by Lender Processing Services (NYSE: LPS) showed a significant decline in foreclosure starts for the last two months – down 21.9 percent in October and almost 48 percent on a year-over-year basis – leading to a nearly 7 percent drop in overall foreclosure inventory. However, as LPS Applied Analytics Senior Vice President Herb Blecher explained, this fall-off in foreclosure starts is likely a temporary phenomenon, driven by new borrower notification requirements called for in the National Mortgage Settlement. (more…)
This week brought yet another record low in mortgage rates, with the average 30-year fixed mortgage rate falling to the record low of 3.94 percent according to Bankrate.com’s weekly national survey. The average 30-year fixed mortgage has an average of 0.46 discount and origination points. (more…)
MLV & Co. announced recently that Zachary Tanenbaum has joined the firm’s equity research team from FBR Capital Markets. Mr. Tanenbaum will work closely with Ryan Meliker, MLV’s Senior REIT Analyst and will spearhead coverage of mortgage and Triple-Net REITs as well as the specialty finance sector. (more…)
The average rate on the benchmark 30-year fixed mortgage rate increased for a second straight week, rising to 4.15 percent, according to Bankrate.com’s weekly national survey. The average 30-year fixed mortgage has an average of 0.40 discount and origination points. (more…)
Speaking at a hearing in Washington, D.C., the Appraisal Institute recently urged a federal judicial agency to require the use of real estate appraisals when calculating loss in mortgage fraud cases. The Appraisal Institute is the nation’s largest professional association of real estate appraisers. (more…)
Freddie Mac (OTC: FMCC) today reported its fourth quarter and full-year 2011 financial results and filed its 2011 annual report on Form 10-K with the U.S. Securities and Exchange Commission. The company’s SEC filing and press release are available now on the company’s website, www.freddiemac.com/investors, along with these related materials: (more…)
Traditionally, spring marks a busy period of time for housing market activity in Indiana. With the heat of summer only weeks away, M&I, a part of BMO Financial Group, offers first-time homebuyers strategies for finding their ideal home while keeping financial priorities in check. (more…)