MortgageReal Estate

HOT or NOT September: What’s trending in housing right now

Interest rates, bank earnings, new GSE credit score models and more make this month's list

1. INTEREST RATES

Yes, they’re still rising. Despite recent criticism of the rising interest rate environment, the Federal Reserve is still expected to raise rates twice more in 2018. President Donald Trump criticized the Fed for raising interest rates, saying he was not thrilled about the interest rate hikes. He later took to Twitter to expand on his thoughts, saying the U.S. should “not be penalized for doing so well.” But experts insist this criticism will not sway the Fed’s decision when it comes time to raise interest rates again this year.

2. LAYOFFS

Unfortunately, layoffs have been on the rise as companies struggle to cope with the increasing competition and rising costs to originate a mortgage. For example, Pacific Union Financial unexpectedly closed the doors to its El Paso, Texas-based mortgage fulfillment call center, leaving the city short 699 promised jobs. And community bank and mortgage lender HomeStreet announced it is closing several offices and laying off more than 100 staffers due to a lack of demand for its mortgage products.

3. DIGITAL NOTARIZATION

Notarize, a digital notary platform and 2018 HousingWire Tech100 winner, announced its integration with Title Resources, a subsidiary of Realogy, to expand online notarization for complete digital real estate transactions. The partnership expands Notarize's reach to nearly 265 million Americans across 38 states and D.C. The new states include Michigan, New Mexico and Wisconsin, according to the company. Earlier this year, Notarize partnered with Westcor Land Title Insurance Company to bring fully digital mortgage closings to 16 states, and as states continue to accept digital notarization, the trend is set to grow.

 

 

1. BANK EARNINGS

Some of the nation’s largest banks, including Wells Fargo, JPMorgan Chase and CitiBank, saw a decrease in their mortgage banking revenue in the second quarter of 2018. While the big banks still reported increases in their net incomes and revenues, it was no thanks to mortgage banking income, which decreased from the previous year and previous quarter. As mortgage origination costs continue to rise, not even the largest banks are immune to its effects and the increased competition.

2. NEW GSE CREDIT SCORE MODELS

FICO and its competitor, VantageScore, have been held in suspense to see which credit score model, if any, the Federal Housing Finance Agency will choose. But now, the FHFA announced it is postponing its decision and will instead be shifting its focus to implementing the Economic Growth, Regulatory Relief and Consumer Protection Act, which passed into law in May. Previously, the FHFA announced it would make its final decision on credit scoring models in 2018, but now that decision could be delayed as far out as 2020.

3. FACEBOOK

Facebook shares plunged 20% at the end of July, obliterating more than $124 billion in market value and marking the largest one-day loss in the history of any publicly traded company, ever. And, the company said it expects revenue to continue its downward spiral for the remainder of the year. This could be bad news for mortgage brokers and real estate agents who have long used it as their method of choice for free self-promotion. Now, with fewer consumers logging on every day, perhaps it’s no longer the best way for agents to spread news of services in their local market.

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