Undergoing a foreclosure can lead home owners to depression, sickness, and even suicide, research shows. But existing health problems also can lead you to foreclosure.
Middle-aged adults with chronic conditions that grew worse as they aged are nearly twice as likely to default on their mortgages and 2.6 times as likely to fall into foreclosure than those with chronic conditions that remained stable, according to new research. The study tracked people as they hit their 40th and 50th birthdays during the foreclosure crisis.
Researchers found that those who grew more ill from 2007 through 2010 were more likely to lose their jobs, as well as income and health insurance. They were more likely, therefore, to also face a foreclosure on their home. Even those who grew more sick but kept their jobs were also found to be more likely to default – possibly due to the rise in their medical costs that were taking priority over their mortgage, researchers suggested.
“The bigger theme remains: Can we break the link between becoming ill and becoming financially devastated?” said Jason Houle, co-author on the study and an assistant professor of sociology at Dartmouth College. “The recession was a good case study to explore this larger question.” Your comments?
Source: “Can Getting Sick Push You into Foreclosure?” The Washington Post (Jan. 21, 2015)
Home sales may be off to a sluggish start this year, but home owners are still upbeat when it comes to the value of their homes. They’re willing to spend to preserve value.
Home-improving giants Lowe’s Co. and Home Depot Inc. reported “blowout fourth quarter profits,” which beat expectations with sales advancing more than 7 percent at both retailers, Bloomberg News reports. Purchases greater than $500 surged 13 percent at Lowe’s. January is showing strong gains too, heading into the spring selling season.
“Consumers are feeling better about their jobs, their wages, and certainly feeling better about the value of their home,” Lowe’s Chief Executive Officer Robert Niblock told Bloomberg. “They are re-engaging in projects that they have put off.”
The remodeling industry also confirms the gains. Remodeling companies see increases in major projects and committed work for the next three months are at all-time highs, according to a fourth quarter survey by the National Association of Home Builders.
Source: “Americans Are Still Housing Bulls, Just Ask Home Depot or Lowe’s,” Bloomberg News (Feb. 25, 2015)
Averages on fixed mortgage rates inched up again this week, amid solid housing data on new home sales and strong home price appreciation, Freddie Mac reports in its weekly mortgage market survey. Despite this week’s uptick, fixed-rate mortgage continue to hover near May 2013 lows.
Freddie Mac reports the following mortgage rates for the week ending Feb. 26:
- 30-year fixed-rate mortgages: averaged 3.80 percent, with an average 0.6 point, rising from last week’s 3.76 percent average. A year ago, 30-year rates averaged 4.37 percent.
- 15-year fixed-rate mortgages: averaged 3.07 percent, with an average 0.6 point, rising from last week’s 3.05 percent average. Last year at this time, 15-year rates averaged 3.39 percent.
- 5-year hybrid adjustable-rate mortgages: averaged 2.99 percent, with an average 0.5 point, rising from last week’s 2.97 percent average. Last year at this time, 5-year ARMs averaged 3.05 percent.
Source: Freddie Mac
Home sales likely will remain subdued early on in the year before picking up in the second quarter and then maintaining a brisk pace for the rest of the year.
Housing activity has been bumpy so far. The National Association of REALTORS® reported this week that existing-home sales tumbled to a nine-month low in January.
But economists polled by Reuters are optimistic that a turnaround will occur due to a strengthening job market that is expected to offset some of that drag.
“We expect the housing market to improve this year,” David Nice, an economist at Mesirow Financial in Chicago, told Reuters. “It is only a matter of time until the improved jobs market has a positive effect on the housing market. We are betting that first-time buyers return this year.” Please provide your comments!
Source: “Strong Jobs Market to Spur U.S. Housing in 2015: Reuters Poll,” Reuters (Feb. 24, 2015)
After several recent drops, mortgage applications reversed course last week, with those for home purchases jumping 5 percent on a seasonally adjusted basis, according to the Mortgage Bankers Association’s latest report. The rise, which reflects data from the week ending Feb. 20, also came despite higher mortgage interest rates, MBA notes. (The survey includes adjustments for the President’s Day holiday.) Nevertheless, purchase applications still remain 2 percent lower than the same week a year ago.
Applications for refinancings continued to fall last week, dropping 8 percent to its lowest level this year. The drop prompted MBA’s overall mortgage application index, reflects both applications for home purchases and refinancings, to fall 3.5 percent for the week.
“The one exception to this trend was VA refinance volume, which increased 27 percent last week as certain lenders refocused on VA production,” says Mike Fratantoni, MBA’s chief economist. “The VA share of total applications increased to 9.6 percent from 8 percent the week prior as a result.”
Source: “Mortgage Applications Point to More Buyers,” CNBC (Feb. 25, 2015)
Good news for potential home shoppers: A Mortgage Bankers Association index shows lender requirements regarding credit scores, down payments, and other key terms are finally loosening up. Some lenders are even expanding the types of mortgages they offer. These moves come after years of lenders tightening loan requirements.
The newly-released MBA index shows recent improvements in lending are mostly tied to the government’s efforts to ease regulations and improve affordability in the housing market. For example, mortgage financing giant Fannie Mae is now allowing purchases of conventional mortgages that have down payments as low as 3 percent; Freddie Mac is planning to do the same for mortgages closed on or after March 23.
Also, the Federal Housing Administration, which insures loans with down payments as low as 3.5 percent, reduced its upfront mortgage insurance premiums last month, which is expanding eligibility for home purchases to thousands of potential home shoppers.
Source: “Lenders Begin Easing Requirements to get a Mortgage,” The Los Angeles Times (Feb. 22, 2015)
Freddie Mac released its U.S. Economic and Housing Market Outlook for February, looking at the affect short-term interest rate policy changes will have in light of the existing substantial downward pressure currently on long-term interest rates.
Highlights from the Outlook include:
• Forecasts for home sales (5.6 million in 2015) and housing starts (1.18 million in 2015) are unchanged from last month.
• Due to continued strong growth in house prices and relatively low inventories, expect house prices to increase 3.9 percent in 2015, up from our forecast of 3.5 percent last month.
• Raised 2015 origination’s forecast to $1.3 trillion from $1.2 trillion last month
• Revised the average 30-year fixed-rate mortgage rate forecast for 2015 down to 3.9 percent for the year, compared to 4.2 percent last month.
Home buyers and refinancers may want to lock in their rates now. Fixed-rate mortgages inched higher for the second consecutive week amid a stronger employment report, according to Freddie Mac’s weekly mortgage market survey.
Still, fixed-rate mortgages are hovering near their all-time low on May 23, 2013, allowing buyers and refinancers an opportunity to lock in a low rate.
Freddie Mac reports the following mortgage rates for the week ending Feb. 19:
- 30-year fixed-rate mortgages: averaged 3.76 percent, with an average 0.6 point, rising from last week’s 3.69 percent average. Last year at this time, 30-year rates averaged 4.33 percent.
- 15-year fixed-rate mortgages: averaged 3.05 percent, with an average 0.6 point, increasing from last week’s 2.99 percent average. A year ago, 15-year rates averaged 3.35 percent.
- 5-year hybrid adjustable-rate mortgages: averaged 2.97 percent, with an average 0.5 point, holding the same from last week. A year ago, 5-year ARMs averaged 3.08 percent
Source: Freddie Mac
The spring market will likely be a hotter one this year, as low interest rates and a healthier economy lure more home buyers to the marketplace.
“Interest rates below 4 percent, rising rents, and healthier local job markets are convincing more consumers to consider home ownership,” Chris Polychron, National Association of REALTORS® president, said in a recent news release showing fourth-quarter 2014 home prices moving up.
An increase in the national family median income (to $65,782) mixed with low interest rates slightly improved affordability in the fourth quarter compared to the previous quarter, NAR reports. Affordability improved despite the national median single-family home price moving up to $208,700 in the fourth quarter, an increase of 6 percent year-over-year.
“Low interest rates helped preserve affordability last quarter, but it’ll take stronger income gains and more housing supply to help meet the pent-up demand for buying,” says Lawrence Yun, NAR’s chief economist. Please provide comments about your area!
Source: National Association of REALTORS®