Friday Rate Update

Mortgage Rates Little Changed as Home Sales Improve

The rate for a 30-year fixed-rate mortgage averaged 4.02 percent this week, up from last week’s 4 percent, Freddie Mac said yesterday. At this time last year, the 30-year FRM rate averaged 4.14 percent. This week’s 15-year FRM rate averaged 3.21 percent, down from last week’s 3.23 percent rate. A year ago, the 15-year FRM rate averaged 3.22 percent--ABA Daily Newsbytes

Delinquent GSE Mortgages Continue to Decline

The number of home loans backed by Fannie Mae and Freddie Mac that are 60 days or more past due or are in the foreclosure process fell 9 percent in the first quarter, following a 3 percent drop in the fourth quarter of 2014, according to the Federal Housing Finance Agency’s foreclosure prevention report released yesterday.

Seriously delinquent loans -- those that are 90 days or more past due -- dropped to 1.8 percent of Fannie and Freddie’s mortgage portfolio after the first quarter. By comparison, 5.7 percent of Federal Housing Administration loans were seriously delinquent, and 4.2 percent of all loans were.

The report also documented the GSEs’ efforts to prevent foreclosures, with 65,960 modifications or other actions in the first quarter and more than 3.47 million since the GSEs have been under U.S. conservatorship.

--ABA Daily Newsbytes

How Do You Market to Millennials? Answer: You Don't

Kevin Tynan, senior vice president of marketing at Chicago-based Liberty Bank, says marketing to millennials remains a hot topic, but community banks have not been very successful in attracting young consumers. He believes articles offering advice on how to reach millennials or detailing what bankers need to know about millennials suggest a one-dimensionality about the demographic. "Most advice is based on viewing millennials as one homogeneous group -- an inherently flawed approach," says Tynan. "That's ludicrous. It's tantamount to saying everyone born between 1980 and 2000 acts, responds, and can be marketed to the same way. There is simply too much economic, geographic, and demographic diversity within the group to make meaningful generalizations." He emphasizes that individuals are shaped mainly by parental values and community and that millennials are not necessarily more technically proficient than other groups. Tynan adds that not all millennials are drawn to the newest app or digital product, but instead look for apps that simplify tasks and increase convenience. "Millennial marketing may be a trendy buzz phrase but it's never a substitute for a carefully developed marketing plan," says Tynan.

From "How Do You Market to Millennials? Answer: You Don't"
American Banker (06/19/15) Tynan, Kevin

Friday Rate Update

Mortgage Rates Take Downward Turn

The rate for a 30-year fixed-rate mortgage averaged 4 percent this week, down from last week’s 4.04 percent, Freddie Mac said yesterday. At this time last year, the 30-year FRM rate averaged 4.17 percent. This week’s 15-year FRM rate averaged 3.23 percent, down from last week’s 3.25 percent rate. A year ago, the 15-year FRM rate averaged 3.3 percent.

--ABA Daily Newsbytes

CFPB to Delay TRID Effective Date to Oct. 1

As reported in a Newsbytes special edition last night, Consumer Financial Protection Bureau Director Richard Cordray announced that the bureau is proposing to push back the effective date of the TILA-RESPA integrated disclosures by two months, from Aug. 1 to Oct. 1, in an effort to avoid closing headaches as the busy fall homebuying season kicks off. The CFPB will issue a proposed rule making the change shortly.

"We made this decision to correct an administrative error that we just discovered in meeting the requirements under federal law, which would have delayed the effective date of the rule by two weeks," Cordray said. "We further believe that the additional time included in the proposed effective date would better accommodate the interests of the many consumers and providers whose families will be busy with the transition to the new school year at that time."

ABA welcomed the news. "This extension will help protect consumers from disruptions during a traditionally busy period for home purchases," said ABA President and CEO Frank Keating. "It will also help to ensure new loan origination systems and compliance software under development by lenders and the vendors on whom they rely will be adequately installed and debugged, and staff training completed, before the effective date."

ABA has engaged in a months-long advocacy effort to persuade the CFPB to delay the rule or provide a hold-harmless period after the rule takes effect for lenders that make good-faith efforts to comply. In a survey shared with the bureau, ABA found that a large majority of banks did not expect to receive their new TRID-compliant systems from vendors until July or later, leaving little to no time to test systems and train staff. By extending the effective date, the CFPB will provide additional time to install and test new systems while removing the risk of civil litigation during the two-month window.

Keating also thanked the CFPB for its announced intent to take good-faith compliance efforts into account in its initial supervisory and enforcement approach. "The TRID rules remain among the most complex with which the banking industry has had to comply, and the quality of compliance should be expected to improve based on the industry's learning curve once systems go live," he said.

--ABA Daily Newbytes

ABA, Trade Group CEOs Call for Support of Data Security Act

Retailers and other firms involved in the payments process should be subject to the same data security requirements as banks, ABA President and CEO Frank Keating and other trade group CEOs said in an op-ed published yesterday in The Hill newspaper.

The CEOs expressed their support of the Data Security Act, legislation introduced by Sens. Roy Blunt (R-Mo.)and Tom Carper (D-Del.) and Reps. Randy Neugebauer (R-Texas) and John Carney (R-Del.) that provides “a reasonable, flexible and scalable solution” for protecting consumers against data breaches.

The act -- modeled on the rigorous standards already in place in the financial industry under the Gramm-Leach-Bliley Act -- would replace state data protection laws with a single set of national requirements and establish a national data security and breach notification standard for financial institutions and retailers.

“As is often the case, technology and innovation have far outpaced the existing body of laws and regulations designed to keep consumers safe,” the CEOs said. “Expectations that sensitive personal and financial data is being kept safe are not being met, and Congress needs to act.” ABA recently wrote to Congress in support of the bills, whose objectives are part of the association’s Agenda for America’s Hometown Banks.  Read the op-ed.

---ABA Daily Newbytes

Friday Rate Update

30-Year Mortgage Rate Tops 4 Percent 

The rate for a 30-year fixed-rate mortgage averaged 4.04 percent this week, up from last week’s 3.87 percent, Freddie Mac said yesterday. At this time last year, the 30-year FRM rate averaged 4.2 percent. This week’s 15-year FRM rate averaged 3.25 percent, up from last week’s 3.08 percent rate. A year ago, the 15-year FRM rate averaged 3.31 percent.

--ABA Daily Newbytes

Survey: QM Rules Continue to Tighten Credit Availability

Eighty percent of bankers expect that the Consumer Financial Protection Bureau’s mortgage rules will continue to constrict mortgage credit, according to the results of ABA’s latest Real Estate Lending Survey released today. Of those 80 percent, nearly one-fifth characterized the impact as severe.

“As expected, the ability-to-repay and QM rules have dampened the housing market recovery,” said ABA EVP Bob Davis. “Combine that with new mortgage disclosures, which are just around the corner, and we’ll continue to see a slowdown in what should be the ideal time to buy a home.”

In more positive news, the survey found that the foreclosure rate dropped from 0.78 percent in 2013 to 0.57 percent in 2013, while the single-family home delinquency rate fell from 2.16 percent to 1.76 percent. The percentage of single family mortgage loans made to first time homebuyers increased in 2014 to 14 percent -- its highest since the survey’s inception -- from 13 percent in 2013. The 30-year fixed-rate mortgage dominated the housing market, remaining over the 50 percent mark for 2014.



---ABA Daily Newsbytes

Friday Rate Update

Mortgage Rates Remain at 2015 High

The rate for a 30-year fixed-rate mortgage averaged 3.87 percent this week, unchanged from the previous week, Freddie Mac said yesterday. At this time last year, the 30-year FRM rate averaged 4.14 percent. This week’s 15-year FRM rate averaged 3.08 percent, down from last week’s 3.11 percent rate. A year ago, the 15-year FRM rate averaged 3.23 percent.


---ABA Daily Newbytes