Tag Archives: Federal Reserve

The odds of a home price correction just spiked—this interactive chart shows if your local housing market is at risk

By | May 20, 2022

There’s no way around it: if the Federal Reserve is going to get runaway inflation back under control, it’s going to cause some economic damage along the way. The central bank has already put immense upward pressure on mortgage rates, which have spiked from 3.11% to 5.25% over the past five months, as it works to cool one of inflation’s… Read More »

The Fed wants to cool the U.S. housing market. Here’s what that feels like

By | May 3, 2022

In mid-April, months into an increasingly frustrating house hunt, Harsh Grewal and his wife settled on a place in a San Francisco suburb and were prepping a bid, above the listed price so they’d have a chance of besting other offers in one of the nation’s hottest housing markets. Then he checked his phone and saw several alerts,… Read More »

Soaring interest rates weigh on big bank mortgage loan growth

By | April 18, 2022

“The increase in rates negatively impacted our mortgage banking business,” Wells Fargo CEO Charlie Scharf told analysts on Thursday. “The mortgage origination market experienced one of the largest quarterly declines that I can remember.” Wells Fargo home loans fell 33% from a year ago on lower mortgage originations and lower gains when selling those loans in the secondary… Read More »

FOMC preview: Fed not expected to raise interest rates this week

By | January 25, 2022

“It really is time for us to begin to move away from those emergency pandemic settings to a more normal level,” Fed Chairman Jerome Powell told Congress two weeks ago, adding that “2022 will be the year in which we take steps toward normalization.” Moving away from those settings would involve raising the federal funds rate, the benchmark… Read More »

Dirt-Cheap U.S. Mortgages Thwarted by $5 Billion in Margin Calls

By | May 4, 2020

“The Fed came in trying to help, but they overshot,” said Phil Rasori, chief operating officer of Mortgage Capital Trading Inc., which says it handles hedging for about 20% of the mortgage market. He estimates margin calls initially drained as much as $5 billion from lenders before the Fed eased off, posing “an existential threat” to some nonbanks… Read More »

U.S. Treasury panel wants mortgage servicer liquidity support as missed payments rise -sources

By | April 7, 2020

Members of the Treasury Borrowing Advisory Committee (TBAC), which advises the U.S. government on the strength of the economy and debt issuance, want a similar facility to cover loans backed by government-run housing finance giants Fannie Mae and Freddie Mac, which cover a far larger proportion of the overall market. The central bank and the U.S. Treasury, which… Read More »

U.S. Mortgage Rates Back to Record Lows, Refinancings Surge as Fed Supports Markets With Billions in MBS Purchases

By | April 1, 2020

“The bleaker economic outlook, along with the first wave of realized job losses reported in last week’s unemployment claims numbers, likely caused potential homebuyers to pull back,” he added. “Purchase applications were down over 10 percent, and after double-digit annual growth to start 2020, activity has fallen off last year’s pace for two straight weeks.” Mortgage applications increased… Read More »

Mortgage bankers warn Fed mortgage purchases unbalanced market, forcing margin calls

By | March 30, 2020

The Fed bought $183 billion of purchases last week of mortgage-backed securities, in an effort to drive down rates, and they did. But the Fed’s actions, amid a volatile market environment, helped add further strains that resulted in blowing up a widespread hedge that mortgage bankers use to protect themselves against rate increases, and now some lenders are… Read More »

Mortgage rates fall sharply as the Federal Reserve brings stability to the mortgage market

By | March 26, 2020

Mortgage rates seesawed lower this week after the Federal Reserve stepped in to provide some assurance to lenders who were at a loss as to how to price home loans amid the disruptions caused by the coronavirus emergency. “It was so disruptive to the point that last week, lenders were really having trouble determining how to price loans… Read More »