Wednesday, June 27, 2012

Four Ways to Incorporate Summer Trends Into Your Homes

Incorporating seasonal style into your home doesn't have to be an expensive or exhausting undertaking. Just a few changes can dramatically change the feel of your home, says West Elm Creative Director Vanessa Holden. And just in time for summer, here are four ways to brighten your home's look.

1.Bring the outside in: Summer is all about bring outside, but you can easily bring the outdoors in with natural materials, textures and light airy fabrics.

Some summer accents are natural wood pieces, woven baskets, sheer fabrics and nature inspired accents in prints or pillows.

Literally bringing the outdoors in can be another way to freshen up your home for the summer. Try terrariums, air plants or indoor herb gardens.

2.Coral crush: The hot hue for the summer? Coral of course! It’s a bright shade, so you can always start small. Coral is great on a throw pillow, duvet cover or bright rug.

You may be worried about what color to pair with coral. Coral looks especially great mixed with reflective finishes like lacquered wood or mirrors.

3.Small accents, big impact: Switching your design scheme for summer doesn’t mean all-new furniture or even a new coat of paint on the walls. Try bringing summer style into your house with affordable accents like pillows, throws or art. A single saturated dose of color can be as powerful as a floor-to-ceiling hue.

4.Do what you like: If you prefer muted colors or even brighter shades, your home can reflect that all year; there’s no reason to drastically change your d├ęcor based on season. Go with your gut, and do what you like.

Season trends will come and go, but our favorite homes are the ones that truly reflect their inhabitants. If you’re inspired by nature or the beach, there is no reason that your home shouldn’t reflect that year-round.

Thursday, June 21, 2012

Rental Housing a 'Bright Spot'

Rental market activity remains a 'bright spot' for the housing marketing, reported Freddie Mac, while Fannie Mae, predicts 'positive' rent growth-varying by area- for 2012.

"Further increases in rental demand are likely in the coming year as newly formed households postpone homeownership decisions until the economy strengthens and they have accumulated sufficient savings," said Frank Nothaft, vice president and chief economist with Freddie Mac. "Overall apartment market trends may show further vacancy declines and rent gains, with property values improving as well."

Freddie Mac's U.S Economic and Housing Market Outlook for June said an additional 1.5 million households moved into rental housing over the year ending March 2012, a 4 percent increase in a single year! Rental vacancy rates have dropped roughly 2 percentage points of the past two years.

Starts of buildings with five or more apartments have jumped 48 percent in the first five months of this year compared to the same period a year ago, the report said.

After seeing these numbers it is amazing to think of how rental increases vary by area. Now I am going to focus on the Top 10 Cities With The Steepest Rent Hikes

  1. Greenville, S.C. 
    • Annual rent increase: 11.2%
    • Average monthly rent: $669
    • Vacancy rate: 7.7% (9.5% in 2009)
    • Average concession: 4%
  2. Chattanooga, Tenn.
    • Annual increase: 10.4%
    • Average monthly rent: $726
    • Vacancy rate: 4.4% (7.1% in 2009)
    • Average concession: 1%
  3. Savannah, Ga.
    • Annual increase: 8.4%
    • Average monthly rent: $866
    • Vacancy rate: 6.3% (6.7% in 2009)
    • Average concession: 3%
  4. Portland-Beaverton, Ore./Vancouver, Wash.
    • Annual increase: 8.1%
    • Average monthly rent: $875
    • Vacancy rate: 4.7% (6.3% in 2009)
    • Average concession: 2%
  5. San Jose-Sunnyvale-Santa Clara, Calif.
    • Annual increase: 8%
    • Average monthly rent: $1,716
    • Vacancy rate: 3.9% (5.3% in 2009)
    • Average concession: 1%
  6. Nashville-Davidson-Murfreesboro, Tenn.
    • Annual increase: 8%
    • Average monthly rent: $786
    • Vacancy rate: 5.5% (7.9% in 2009)
    • Average concession: 5%
  7. Tacoma, Wash.
    • Annual increase: 8%
    • Average monthly rent: $900
    • Vacancy rate: 6.7% (8.9% in 2009)
    • Average concession: 3%
  8. Denver-Aurora, Colo.
    • Annual increase: 7.5%
    • Average monthly rent: $873
    • Vacancy rate: 5.6% (7.5% in 2009)
    • Average concession: 4%
  9. Washington, D.C./Arlington-Alexandria, Va.
    • Annual increase: 7.4%
    • Average monthly rent: $1,473
    • Vacancy rate: 4.6% (5.7% in 2009)
    • Average concession: 2%
  10. Raleigh-Cary, N.C.
    • Annual increase: 7.4%
    • Average monthly rent: $785
    • Vacancy rate: 6.1% (7.4% in 2009)
    • Average concession: 4%

Wednesday, June 20, 2012

Mortgage Banking's High-Tech Conundrum

Today I was reading my usual newsletter and publication emails and I came across this article in MortgageOrb and I had to share it with our readers because it is so relavant to what IDS is all about the product and compliance that we provide on a regular basis. Feel free to share any comments or thoughts

Mortgage Banking's High-Tech Conundrum
By: Linn Cook & Binh Dang

The aftermath of the mortgage meltdown has forced lenders to scrutinize the capabilities of their technology to keep pace with regulatory and compliance changes. Technology providers must incorporate new forms, documentation and calculations in order to ensure that their systems aren't obsolete. (The IDS in-house counsel and compliance team allow us to change, update and prepare for all the regulations and changes that occur on an almost daily basis.)

But the impacts of regulatory and compliance changes go further than just updating documentations or calculations. Investors and regulators, such as the recently developed Consumer Finance Protection Bureau (CFPB), are demanding greater transparency of a lender's process, requiring more-detailed and better-quality data. As a result, data that was sufficient in the past is being taken to task, especially for lenders that rely on integrations between more than one system to run their operations.

Multiple databases and incomplete transfers of data make it difficult for lenders to locate information that is accurate and that can be relied upon for critical business decisions. The potential impact can be catastrophic for a lender given the increased scrutiny and penalties that can be levied on lenders by agencies such as the CFPB.

According to the Mortgage Bankers Association (MBA), secondary marketing profit margins have declined in the past two quarters, and this had a substantial impact on lender profitability. Between the third and fourth quarters of 2011, average secondary marketing profits dropped 15 basis points (bps) and average net production profit fell to 58 bps, reducing lender profitability by 25%. Therefore, lenders are looking for new platforms to help them lower their cost per loan and improve profitability to mitigate the impact of falling secondary marketing gains.

Since 2006, more than 80,000 mortgage brokers have exited the business as loan volume dropped from a peak of $3 trillion in 2005 to an expected volume of less than $1 trillion in 2012. As the overall industry struggled, so did mortgage technology vendors.

According to industry experts, the mortgage technology vendor market shrank from approximately 600 vendors in 2005 to just 300 today. And the contraction continues as merger and acquisition activity heats up. The consolidation activity is causing lenders to question the long-term viability for continued vendor support of their platforms, especially if the vendor has recently been involved in a merger or acquisition.

As a result, lenders are taking pre-emptive actions to search for a technology vendor that provides a greater degree of comfort related to a long-term commitment to support and enhance their platforms. 

In spite of the industry's struggles, mortgage technology continues to innovate with the rest of the business world. The internet, cloud computing and mobile technology are just three examples of newer technologies that are beginning to establish themselves as key drivers of growth.

The emergence of cloud computing is by far one of the biggest advances that is changing mortgage technology, especially in the loan origination system (LOS) space. Lenders are able to reduce their total cost of software ownership (TCO) by as much as 70% using a cloud-based or -hosted solution, and they now have the ability scale software more efficiently- these factors are swaying lenders to change their technology.

Although mobile technology is still relatively immature, lenders are also taking a serious look at the technology as a way to drive more efficiency and to attract volume-producing talent to their organization. While completing a 1003 application on a smartphone is still a ways off (at least practically speaking), the ability to link originators to information in their LOS and real-time pricing tools are already here. The direction that mobile technology will go is unknown, but many predict that it's only a matter of time before lenders are expected to have some form of mobility built into their technology strategies. 

It has been a long time coming, but the Internet has finally become a legitimate business channel for lenders. Although the concept of using the Internet to market home loans is as old as the Internet itself, actual usage by consumers was scant until recently., one of the pioneers of Internet mortgage lending, reports that 21% of consumers now use the Internet to shop for a home loan. With the concurrent growth of online mortgage marketplaces like LendingTree and Zillow, mortgage lenders of any size can look to the Internet as a legitimate source of loan volume.

When we face a problem, our natural instinct is to solve it. When we see an opportunity, the instinct is to go after it. So in the fast-paced world of mortgage lending, it's only natural for lenders to have a reactionary response to problems and opportunities.

However, this type of reactionary behavior can be counterproductive and ultimately lead to poor decision-making. Moving quickly to quash a problem or take advantage of a new opportunity can turn into a game of whack-a-mole: as one problem or opportunity is solved, another one appears. Since not every problem can be solved nor can every opportunity turn into The Next Big Thing, a reservoir of frustration builds into a crisis, at which point the executive staff calls for a technology makeover.

This reactive model of decision-making creates a list-driven process of technology evaluation. Lenders gather all of their identified problems and opportunities into a wish list and embark on a search for a provider that can meet these needs. The provider that is best suited to satisfy their wish list at the lowest cost is the one that is selected. In response, technology providers market and sell their products using 'feature lists' to make it easier for lenders to identify their value.

Why, then, do so many lenders end up having buyer's remorse? Although data is scant one study showed that only 60% of lenders were happy with their LOS technology investment. Many were disappointed with rollout times, cost overruns and customer service.

But more telling is that one out of four lenders in this study felt that their providers over-promised on functionality and ended up delivering vaporware. In fact, almost half of all lenders believed that vaporware is a common occurrence in the mortgage technology industry.

But what would vendors have to gain by not delivering a solution that they promised? And why would lenders continue working with a company that they felt did not follow through on their promises? We believe that the real cause of dissatisfaction with technology outcomes is dishonesty, but a lack of understanding- a lack of understanding between lenders and vendors, as well as a lack of understanding between lenders and vendors, as well as a lack of understanding that lenders have about themselves.

When lenders go through their wish list of desired functionality and say they need a document imaging system, for instance, they don't communicate the reason why they need it or the actual problem they're trying to solve. Is it because the cost of handling paper is too high? Is it because their staff has a hard time finding documents because they're in difference locations? There are several reasons behind a request for a feature or tool.

Therefore, it's easy to see how a lender's needs can easily become lost in translation, and how that can result in dissatisfaction with technology choices. Vendors aren't necessarily guilty of delivering vaporware; they're simply making wrong assumptions about lender expectations.

Linn Cook is director of marketing and Binh Dang is president of Costa Mesa, Calif-based lendingQB. They can be reached at (888) 285-3912. This article is adapted and edited from their new white paper, "Making Better Technology Decisions."

IDS will forever provide the mortgage industry with cutting-edge technology and fully compliant documents. No matter what is in store for the future of our industry our customers and their needs are our first priority.

Tuesday, June 19, 2012

FHFA Proposes Rule To Forbid GSEs From Purchasing PACE Loans

The Federal Housing Finance Agency (FHFA), conservator of Fannie Mae and Freddie Mac, has issued a proposed rule that would prohibit the GSEs from purchasing loans affected by the Property Assessed Clean Energy (PACE) program.

PACE is a local government initiative designed to help homeowners finance energy-efficient and renewable energy projects for their homes.

Homeowners repay the government for the financing through property tax adjustments.

PACE "moves ahead of the pre-existing first mortgage in lien priority, and thereby subordinates Fannie Mae and Freddie Mac security interests in the property," according to a statement from the FHFA announcing the proposed rule.

As such, "PACE financing arrangements present a safety and soundness concern by transferring financial risks to the regulated entities and lacking in adequate consumer protections and standards for energy retrofitting," the FHFA stated.

When FHFA publicized an advance notice of proposed rule-making earlier this year, the National Association of Realtors commented that the "first lien position of PACE loans adds an unnecessary risk and may threaten mortgage markets during the current fragile recovery of real estate markets."

FHFA's proposed rule is open for comments for 45 days from its date of publication, June 15.

PACE financing for energy efficient projects is available in 18 states and the District of Columbia, according to the PACE website.

Friday, June 8, 2012

Thursday, June 7, 2012

Summer Break

After this week many of you will be home free for the summer and that means family vacations, summer camps, days spent at the pool and of course spending money of traveling, gas and different types of activity fees. When the temperature heats up, don’t let your budget melt down. Today I wanted to provider our readers with some of my favorite tips for keeping your wallet intact this summer.

-      In the summer everyone likes to shop light, especially when it comes to food. Grocery store produce and flowers tend to run pricey at this time of year so I suggest you stop by your local farmers market. Spinach, cucumbers, tomatoes, string beans and red bell peppers are cheap and in season right now. Also you can pick up daisies and lilies at bargain prices to keep the inside of your inside feeling summery.

-      I mentioned family vacations well instead of forking over a fortune to fly to a faraway place try ‘vacationing’ at home. For example, imagine you are in Hawaii; make a day of creating decorations, leis, floral centerpieces and everything Hawaiian to create a Hawaiian oasis in your own backyard. Far less expensive than flying your whole family over there.

-       In the summer everyone needs new clothes to accommodate for the warmer temperatures. Instead of frittering away cash on hot-weather outfits try holding a swap-a-thon with your girlfriends. The swap-a-thon could be clothes for just you or children’s clothing as well. This will help cut-down the amount of items you will need to purchase. Most department stores have major summer sales; look into getting swimsuits, sandals and sunglasses now.

-      Summers means catching the latest summer blockbuster, but with tickets being more expensive than ever, try and hit cheaper matinees or borrowing recent flicks for free from the library. On top of free movies from the library, see if you neighborhood will be hosting movie nights in the park. Several small towns host a movie night once a week with a big screen, all you need is to bring your own blankets and candy. This is also a great way to stay in touch with everyone while school is out.

-      Instead of family outings to splashy, pricey water parks try operating one from home. All you need to do is turn on the lawn sprinklers get some slip n’ slides and relax in the kiddie pool.

-      GAS! We all know that gas prices are extremely high right now, but we also know that we will be doing a lot of driving this summer. Instead of doing all the driving yourself create a carpool. You can swap your road trips into day trips and explore some new places nearby.

-      Instead of paying admission fees to concerts and festivals look for free festivals in your area. Check local newspapers, bulletin boards, Google and even some blogs.

-      Hot temperatures makes ice cream that more appealing, instead of spending lots of money making ice cream pit stops try freezing bananas, blueberries, raspberries and strawberries for a sweet, cheap summer snack. Another idea toss any uneaten frozen fruit into a blender pour into ice-pop molds and refreeze for later.

Hopefully these ideas get your mind going with ideas on how to make this summer fun, but not pricey.

Wednesday, June 6, 2012

Industry Could Be Back on The Upswing

It seems that the mortgage industry is full of excitement these days, excitement over the fact that the industry could be back on the upswing.

Usually when I arrive in the office around 7:00am Mountain Standard Time, I go over the morning newsletters that I receive from MReport, National Mortgage News, MBANewsLink, MortgageSpeak and MortgageOrb. This morning all of them featured some type of article or announcement about the rise in mortgage applications for April.

According to MBA NewsLink CoreLogic’s April Home Price Index showed a year-over-year increase of 1.1 percent, the second consecutive year-over-year increase this year and the first time two consecutive increases have occurred since June 2010.

This is definitely encouraging news for all of us who have experienced the last several years in this industry, but are we getting our hopes and spirits up too much? May this just be a coincidence? Hopefully not, but let me know your thoughts, are we getting too excited?
Another question I want to ask is what type of homes are mostly being sold- new homes, short sales, foreclosures? Leave a comment and let me know your thoughts

Tuesday, June 5, 2012

MortgageOrb: idsDoc Updated For FHA MIP Increase

MortgageOrb: idsDoc Updated For FHA MIP Increase

International Document Services (IDS), a Salt Lake City-based mortgage document preparation vendor, announced it has revised its flagship mortgage document preparation system, idsDoc, to reflect the Federal Housing Administration's (FHA) mortgage insurance premium (MIP) increase. The increase, one quarter of one point, will be applied to all 15-year and 30-year mortgages backed by the agency.

In order to accommodate for these regulation changes, IDS added a new field called FHA Endorsement Date, which allows lenders to select the appropriate mortgage insurance rate based on the date of application.

"Our main concern with any regulatory change is to ensure that our customers are able to demonstrate without a doubt their adherence to both the letter and spirit of that change," says IDS Executive Vice President Mark Mackey. "Whether, as in this case, it's a small system change or a large-scale development overhaul, we're willing to do whatever it takes to keep our customers compliant."

Monday, June 4, 2012

Shortening Loan Terms

As mortgage rates sink deeper into record territory, homeowners are refinancing into 15-year loans at a pace not seen in a decade, aiming to pay off their debt in time for retirement.
Freddie Mac's latest mortgage rate survey showed the traditional 30-year fixed-rate loan averaged 3.75% this week, down from 3.78% last week. It was the fifth straight week of record lows.
Even more eye-catching in Thursday's survey was the average for a 15-year fixed loan — 2.97%, down from 3.04% a week ago. It was the first sub-3% reading in the nearly 21 years that Freddie has tracked the 15-year loan.

With housing markets still troubled, the rates are mainly benefiting refinancers whose luck or self-discipline has left them with significant home equity. Purchase lending remains sluggish: The Mortgage Bankers Association says that less than a quarter of mortgages these days are used to buy homes.

Also contributing to the trend: recent changes in the Obama administration's Home Affordable Refinance Program, which cut the fees for certain borrowers getting new loans if they reduce the term of the mortgage to less than 30 years.
By Freddie Mac's count, 31% of the refinancers in the first quarter of this year opted for shorter-term loans.
The question still floating in the air is how do we get potential homeowners to buy homes, not just refinance? It has been a tricky and touchy subject for everyone in the mortgage industry with an unknown answer.

There has been the first time homeowners tax and other home buying incentives put into place, but it doesn’t seem to result in the numbers we all want.

All we can do as of right now is wait and hope and continue to see if the numbers will change. At least we have the refinances hitting record numbers right?