INDYMAC wants more CONFORMING LOANS FULL DOC!

[bsrsharma]

The most humane way to shrink the monster bubble to a raisin is to take away the bottle of large cheap mortgages. When anyone who wants to buy a half mil $ property HAS to bring half mil $ cash, rationality will be quickly restored.

rb_engineer: What is the special treatment for Alaska/Hawaii and why?

[bsrsharma]

The most humane way to shrink the monster bubble to a raisin is to take away the bottle of large cheap mortgages. When anyone who wants to buy a half mil $ property HAS to bring half mil $ cash, rationality will be quickly restored.

rb_engineer: What is the special treatment for Alaska/Hawaii and why?

[LA_Renter]

For what it’s worth this is K Denninger’s take at market-ticker;

“The market has not yet gotten its arms around the Moody’s announcement on the securitization credit rating process as I outlined in the ticker the other night. It will. When? I can’t tell you that, but what I can tell you with certainty is that the squeeze in the mortgage marketplace will get much worse, will implode more lenders and will materially impact all of them.

The warning on this was when S&P said they were re-jiggering their models for mortgage ABS issues. But – they didn’t put any hair on that dog. Moody’s did, however, and then turned it rabid and let it loose.

Ignore this at your peril if you are long the market.

As I have said repeatedly – 30% of the demand that exists now in the housing market is going to be flushed as the ALT-A and Subprime pipeline is either shut down entirely or repriced to near credit-card rates. This IS happening – right now – and it WILL drag the economy into a recession. This will not end until there is a serious price contraction in housing prices so that affordability returns to historical norms.

Now go back and read that again guys. And then again. And then again.”

http://market-ticker.denninger.net/

Yikes!

[LA_Renter]

For what it’s worth this is K Denninger’s take at market-ticker;

“The market has not yet gotten its arms around the Moody’s announcement on the securitization credit rating process as I outlined in the ticker the other night. It will. When? I can’t tell you that, but what I can tell you with certainty is that the squeeze in the mortgage marketplace will get much worse, will implode more lenders and will materially impact all of them.

The warning on this was when S&P said they were re-jiggering their models for mortgage ABS issues. But – they didn’t put any hair on that dog. Moody’s did, however, and then turned it rabid and let it loose.

Ignore this at your peril if you are long the market.

As I have said repeatedly – 30% of the demand that exists now in the housing market is going to be flushed as the ALT-A and Subprime pipeline is either shut down entirely or repriced to near credit-card rates. This IS happening – right now – and it WILL drag the economy into a recession. This will not end until there is a serious price contraction in housing prices so that affordability returns to historical norms.

Now go back and read that again guys. And then again. And then again.”

http://market-ticker.denninger.net/

Yikes!

[ak1]

I just noticed that Wells Fargo just increased their rate for 30 year fixed jumbo loans to 8% from 6 7/8% last week! Here’s the link http://online.wsj.com/article/SB118609866621886776.html?mod=yahoo_hs&ru=yahoo

Quote from the article

“Lenders are tightening standards and “raising rates like crazy,” said Melissa Cohn, chief executive of Manhattan Mortgage, a New York mortgage broker. She said Wells Fargo & Co. is charging 8% for a prime jumbo 30-year fixed-rate loan that carried a 6 7/8% rate late last week.”

[ak1]

I just noticed that Wells Fargo just increased their rate for 30 year fixed jumbo loans to 8% from 6 7/8% last week! Here’s the link http://online.wsj.com/article/SB118609866621886776.html?mod=yahoo_hs&ru=yahoo

Quote from the article

“Lenders are tightening standards and “raising rates like crazy,” said Melissa Cohn, chief executive of Manhattan Mortgage, a New York mortgage broker. She said Wells Fargo & Co. is charging 8% for a prime jumbo 30-year fixed-rate loan that carried a 6 7/8% rate late last week.”

[rb_engineer]

Probably a typo. Wells Fargo website says 7%. None the less, its still very high.

[rb_engineer]

Probably a typo. Wells Fargo website says 7%. None the less, its still very high.

[bsrsharma]

“its still very high.”

I happily paid 7.625% on a conforming loan for 7 years. For how many years in last 40 years was this cheaper than 7%? I think people have become addicted to low rates. Time to kick the habit. That will promote savings over consumption.

[bsrsharma]

“its still very high.”

I happily paid 7.625% on a conforming loan for 7 years. For how many years in last 40 years was this cheaper than 7%? I think people have become addicted to low rates. Time to kick the habit. That will promote savings over consumption.

[rb_engineer]

Well. 7% is above my threshold of comfort. Yes, I’m spoiled…

Hawaii and Alaska’s conforming loan is 625K. I guess because houses are more expensive there.

[rb_engineer]

Well. 7% is above my threshold of comfort. Yes, I’m spoiled…

Hawaii and Alaska’s conforming loan is 625K. I guess because houses are more expensive there.

[bsrsharma]

“Hawaii and Alaska’s conforming loan is 625K. I guess because houses are more expensive there.”

Interesting; for that number, households should be making 150K-200K p.a. What is the source of that kind of income? I haven’t been to either state.

[bsrsharma]

“Hawaii and Alaska’s conforming loan is 625K. I guess because houses are more expensive there.”

Interesting; for that number, households should be making 150K-200K p.a. What is the source of that kind of income? I haven’t been to either state.

[rb_engineer]

I would say Hawaii is purely supply and demand. Personally, I don’t really subscribe to the “median income x == median price x”. Just like anything, price goes up if demand goes up. I would say for Alaska, its set high to attract people. Just a guess.

[Author]

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