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Regional Mortgage Outfit Opens on Lorimer in Williamsburg
Mortgage Master, a large regional lender, opened shop in Williamsburg in December. The Massachusetts-based firm is among the largest, privately-owned mortgage lenders in the country with over $5 billion in loans a year and offices throughout the northeast and in California. Apparently the skyrocketing market in Williamsburg has caught its eye. The 1,600 square-foot office — a bit off the beaten path at 697 Lorimer between the BQE and McCarren Park — is staffed by Brooklyn locals. The landlord installed reclaimed timber, an old winch and other odds and ends found in a building he owns in Greenpoint. More pics after the jump. (more…)
01/30/2013 2:00 PM
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Over 20 Percent of NYC Metro Area Mortgage Holders Underwater, But Brownstone Brooklyn Largely Spared
The headline pretty much says it all: The percentage of mortgage holders in New York City and environs who have negative equity ticked up slightly from 20.1 in the fourth quarter of 2011 to 21.3 in the first quarter of 2012. As you can see from the map (from Zillow via The Real Deal), however, much of the pain was felt in New Jersey and Queens. Brooklyn, especially Brownstone Brooklyn, looks largely unscathed. And compared to the rest of the country, where almost one-third of homeowners are still underwater, New York isn’t doing too badly.
One-fifth of NYC-area Borrowers Are Underwater [The Real Deal]
05/25/2012 9:00 AM
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Mortgage Rates Hit Record Lows
From The Wall Street Journal:
Real-estate website Zillow Inc. (Z) said Tuesday its real-time rate on 30-year fixed mortgages fell to a new record low in the last week. Zillow said the 30-year fixed mortgage rate on its Mortgage Marketplace is at 3.66%, down from 3.72% a week earlier. The rate is the lowest since Mortgage Marketplace launched in April 2008, Zillow said. The company said the 30-year fixed mortgage rate peaked at 3.7% on Friday and steadily declined through the weekend, dropping to its current rate Tuesday morning. Erin Lantz, director of Zillow Mortgage Marketplace, said despite strong employment figures on Friday, the rate has remained historically low and has been hovering between 3.65% and 3.7% for the past week. “Although European headlines may drive more volatility in the coming week, we expect rates will stay near this range,” Lantz said.
02/08/2012 10:15 AM
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Mortgage Loan Delinquency Rate in Brooklyn Rose in Final Quarter of 2010…
02/21/2011 10:00 AM
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Another Mortgage Fraud Ring Busted
This isn’t the first mortgage fraud bust in Brooklyn and it won’t be the last, but it’s good to see some weight sentences getting thrown around. This case, reported by The Post today, involves all the usual suspects: a ring of lawyers, real estate brokers, mortgage brokers, title insurers and straw buyers got together to buy cheap properties in Brooklyn and Queens and then quickly flip them at inflated prices. The amount of fraud surpassed $10 million, with Lehman Brothers and a handful of lenders getting stuck with the bill. The ring leader, a 44-year-old lawyer named Anthony Onua, could face up to 30 years in prison.
Photo by i_follow
10/07/2010 9:30 AM
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To Pay Down or Not Pay Down Your Mortgage
The New York Times had a good primer this weekend on when it makes sense to send in money above and beyond your required monthly payment to reduce the principal amount of your mortgage. Back in corporate finance class in business school (if we recall correctly—it’s been twelve years!), you’re taught that a company should pay down its debt if can’t find any alternative use for its capital that it believes can return as much as it’s paying in interest on its debt. The same thing applies to an individual, and with rates as low as they are and the significant tax breaks factored in, the hurdle is pretty low right now. “Back when rates ran at 7 or 8 percent, making extra payments offered what amounted to a guaranteed return on your money,” says The Times. “When you’re ridding yourself of debt that costs you much less, however, it’s easier to imagine a future when you could more easily earn a higher return by investing those potential extra mortgage payments someplace else.” Of course, there are some other common-sense considerations to factor in, like the flexibility and safety that having some cash sitting in the bank can bring or the priority of paying off higher-interest debt like credit cards before attacking the balance of your mortgage.
When Not to Pay Down a Mortgage [Brownstoner]
When Not to Pay Down a Mortgage [Brownstoner]
03/22/2010 10:00 AM
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Appraising the Appraisers
Appraisals, for all their importance in getting a mortgage and buying a home, seem to be rather nebulous. This past weekend, The New York Times ran an article pointing out several gray areas in the art of appraising. First of all, a change in the Home Valuation Code of Conduct that took effect back in May gave banks exclusive power over the appraisal process. The plus side, and intent of the change, is that brokers, builders, and buyers cannot influence the appraisal as much; the down side, according to some appraisers in New York, is that banks are using national appraisal firms that assign appraisers who charge lower fees—i.e., less experienced appraisers who are likely unfamiliar with the local market, something which is essential in New York City’s market of microscopic subclimates. It is common, of course, in a down market for appraisals to come in low, but the combination of inexperienced appraisers and fewer data points due to lower volume might result in inaccurately low valuations. Buffalo News made a similar report about the appraisal industry upstate, and CNN Money reported that the housing industry met with New York Attorney General Andrew Cuomo last week to protest the current Code of Conduct, and the attorney general’s office agreed to consider the matter further. The primary sources for these articles are brokers and local appraisers. We’d like to hear from other players in the game, as well. Any bankers, buyers, or national appraisers out there who want to throw their hat into the ring?
New York Appraisals Get Shortchanged [NY Times]
Tougher Appraisals Make Home Sales Harder [Buffalo News]
Housing Industry to Cuomo: Let’s Work Together [CNN Money]
Photo by Richard Wanderman
09/28/2009 9:00 AM
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Lower Down Payments, Lower Interest Rates
Common wisdom for home-buyers has been to front at least 20 percent as a down payment, but this practice may no longer be rewarded by the financial markets, reports The New York Times. Because of rules implemented by Fannie Mae and Freddie Mac in 2008, “for most people, it turns out, smaller down payments result in lower interest rates,” according to the Times. For example, The Times found that a buyer with a 720 credit score buying a $400,000 home would typically be able to obtain a 30-year fixed-rate mortgage of 4.875 percent if he were putting down $80,000. Perversely, he could have gotten the same rate by only putting down 5 percent as well. Why’s that? In the case of the 5 percent down payment he would have been required to pay mortgage insurance of around a hundred bucks a month. Even stranger, if he’d been even more conservative and opted to put down 25 percent, his interest rate would have shot up to 5.375 percent. Apparently, lenders like the idea of a borrower having a cushion in his checking account better than having a smaller loan principal. Strange days indeed.
A Down Payment Anomaly [NY Times]
Photo by Corey Thomas
A Down Payment Anomaly [NY Times]
Photo by Corey Thomas
09/08/2009 9:32 AM
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Do You Qualify for Federal Mortgage Relief?
Bankrate.com has created a simple, handy quiz to determine whether you qualify for the federal government’s new Home Affordable Refinance program, which helps home-owners struggling with their mortgages. Bankrate.com also adds that you might qualify even if your first mortgage slightly exceeds the market value of the property. Go to the quiz via the link above, or click here.
08/21/2009 9:31 AM
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New York State’s Mortgage Aid
In addition to the federal tax cut for first-time home-buyers, New York State is sweetening the deal by offering its own mortgage aid, reported the New York Times this weekend. The State of New York Mortgage Agency’s Mortgage Credit Certificate program will grant federal income-tax credits to first-time buyers equal to 20 percent of the annual mortgage interest. To apply in New York City, the Times explains, “the combined annual income for households with three or more people cannot exceed $107,520, and the house price cannot exceed $637,640.” Participating banks such as M&T Bank and Wells Fargo will begin accepting applications in early September, and the program will run through the end of the year. And unlike the federal aid program, the Mortgage Credit Certificate will renew its tax credit every year.
More Help for New Yorkers [NY Times]
Photo by David Lot
More Help for New Yorkers [NY Times]
Photo by David Lot
08/11/2009 9:30 AM
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Federal Life-Preserver Loans Target Sinking Borrowers
This weekend the Times had word about a new version of the federal Home Affordable Refinance Program, which is expected to start issuing loans by October and is aimed at helping borrowers who owe more than their homes are worth. So-called “underwater” borrowers who have not missed a mortgage payment—but are nevertheless in danger of becoming the next wave of foreclosures—will be able to avail themselves of the program if their mortgage is up to 25 percent more than their home’s current value. The loans will only be given to borrowers who have Fannie or Freddie loans, and they probably won’t have the very most competitive rates. Nevertheless, they’re expected to help out a lot of New York-region borrowers: “Michael Moskowitz, the president of Equity Now, a lender based in Manhattan, says he believes that New York borrowers will benefit from the recent changes. The area, he said, is among the last in the nation to experience significant drops in real estate values. ‘But because of the unemployment on Wall Street, that will continue,’ Mr. Moskowitz said. ‘So this program will have a very meaningful effect here.’”
Lifelines for Those ‘Underwater’ [NY Times]
Photo by zert.sonstige_2008
Lifelines for Those ‘Underwater’ [NY Times]
Photo by zert.sonstige_2008
07/27/2009 10:00 AM
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Tough Slog for Buyers Seeking Jumbo Mortgages
From this weekend’s Times, a story about the difficulties of obtaining a nonconforming jumbo loan in the post-meltdown market: “‘Two years ago these loans could be accommodated very easily, but today the requirements to get those loans are much more stringent,’ said David Adamo, the chief executive of Luxury Mortgage in Stamford, Conn. Mr. Adamo likened the current mortgage market to a barbell, with pockets of availability for borrowers at both ends of the income spectrum but less for those in between. Those with annual incomes up to about $250,000 have access to mortgages insured by the Federal Housing Administration, while the very affluent can obtain loans from private banking institutions. For borrowers with household incomes between $250,000 and $500,000, however, mortgages are not as easy to get, Mr. Adamo said. ‘These people are living in places where starter homes might be $1 million,’ he said, ‘and it’s really affecting them.’ Fannie Mae and Freddie Mac will accept only loans below $729,500 in the highest-cost markets like New York City and northern New Jersey. For mortgages larger than that, mortgage brokers and bankers must find other investors who want to take the loans.” The story talks about how borrowers have to go to community banks like Astoria Federal and Hudson City Savings Bank to get jumbos, and that qualifying for the loans at these institutions has become much more difficult.
Securing a Jumbo: No Small Task [NY Times]
07/06/2009 10:00 AM
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F.H.A. Loans Skyrocket in Popularity
From this weekend’s Times real estate section: “Loans insured by the F.H.A., an arm of HUD, protect lenders from losses, thereby encouraging them to provide financing to those who might otherwise be refused a mortgage. These loans are typically 30-year fixed-rate products, but they require only a small down payment, as low as 3.5 percent — significantly less than the 20 percent standard of recent months. Often, the loans are made to people who don’t have perfect credit scores.” The article says the loans now account for a quarter of all mortgages, up from 2 percent only 3 years ago. Although they often serve borrowers with less-than-stellar credit, they’re considered solid because people receiving them must have verifiable income and jobs. The loans cap out at $729,750 here in New York, and condo developers who want to offer them have to “meet a variety of financial, structural and environmental standards and restrictions.” As we covered a couple weeks ago, an East Williamsburg condo that offers F.H.A. loans is seeing brisk sales.
F.H.A. Loans Help Sales [NY Times]
Nondescript East W’burg Condos Defying the Market [Brownstoner]
On the Other Hand: Chase Pushing FHA Loans [Brownstoner]
F.H.A. Loans Help Sales [NY Times]
Nondescript East W’burg Condos Defying the Market [Brownstoner]
On the Other Hand: Chase Pushing FHA Loans [Brownstoner]
06/29/2009 9:30 AM
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Mortgage Mod Program Off to a Slow Start
The cover story in the real estate section of this weekend’s Times is about how Obama’s mortgage relief program, unveiled in March, has been slow to deliver much-needed help in New York: ‘The promise of this program is enormous,’ said Rafael Cestero, the commissioner of the city’s Department of Housing Preservation and Development. ‘It’s a brand-new program and it’s a very complicated issue, but we all share the feeling that it’s been moving too slowly.’ The federal program offsets some costs for banks that agree to modify mortgages. Mr. Cestero estimated that in addition to the 400 applications handled by the center, other agencies have probably processed 400 applications. ‘When you think that almost all of those are in southeast Queens and some in eastern Brooklyn,’ he said, ‘that’s a lot of people in need in a not particularly big area. Housing counselors say that while 15 lenders — including major ones like Bank of America, CitiMortgage, Chase and Wells Fargo & Co. are participating, many have yet to fully train people to process the applications. As a result, housing counselors say they often receive mixed signals, with different lenders offering different interpretations of the guidelines, including whether foreclosure actions can proceed while a loan modification is being considered and whether you have to be current on your payments to be eligible for a modification.”
Penetrating the Maze of Mortgage Relief [NY Times]
Photo by Nick Blake.
Penetrating the Maze of Mortgage Relief [NY Times]
Photo by Nick Blake.
06/15/2009 10:00 AM
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15-Year Mortgages Grow in Popularity
In this weekend’s Real Estate section, the Times had an article on the increasing popularity of 15-year, fixed-rate mortgages: “Brokers and mortgage industry executives say that these loans are becoming especially popular among people who want to shed debt more quickly, and in light of the current economic atmosphere, that goal is perhaps more widely applicable than ever. Of course, debt shedding comes at a price. Those borrowing $400,000 on a 15-year loan, with a 4.375 percent interest rate, the average rate earlier this month, can expect to pay about $3,034 a month, compared with about $2,056 a month for a 30-year fixed-rate loan with a 4.625 percent average rate. (The payment excludes costs like property taxes and insurance.) Because a 15-year loan also has 180 fewer interest payments than a 30-year loan, the borrower with that 15-year loan would pay $194,000 less in interest over the life of the mortgage.” Any readers considering them over 30-year loans?
Photo by Rev Dan Catt
Photo by Rev Dan Catt
05/26/2009 10:15 AM
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Chase Turns Off Our Spigot—For Now at Least
Here’s an interesting twist in our refinancing story. We received in the mail earlier this week the following notice from Chase, which is the provider of both our current mortgage and our Home Equity Line of Credit:
With home values falling in many parts of the country, we’ve used a proven valuation method to estimate your home’s value at $1,000,000. Unfortunately, that valuation no longer supports the full amount of your Line of Credit, so we are suspending future draws again your account as of May 15, 2009.
Say what? Leaving aside for a moment our suspicion that their “proven valuation method” did not take into account the fact that ours is a five-story house, the most interesting part of this is the perverse incentive it creates: After we finished our renovation in late 2005, our HELOC was pretty close to maxed out at $62,500. Since then, we’ve chipped away a few hundred dollars a month at the principal, so that the balance is now around $47,000. (Our credit score, as of last week, was the equivalent of an “A+”, according to our Chase refinancing so that can’t have anything to do with it.) So now, instead of continuing to reduce our balance, we’re going to just pay off the interest, since we know we can’t tap the line in the future if we needed to. The appraiser came for our mortgage refi yesterday morning; if that goes okay, we should have a decent case to make for unfreezing the line of credit. Regardless, the “proven valuation method” sounds like some very unnuanced generalizing at best and suspiciously like the beginnings of some old-school red-lining at worst. If, for example, the computer is using zip codes to group areas by risk, then it has no way of differentiating between a house on Classon and a house on Clinton. Or if it’s merely using physical proximity, our house could be impacted by comps a half-mile away on a less valuable block of Bed Stuy. Scary.
05/22/2009 9:30 AM
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Refinancing: How Sweet It Is
We’ve had a 6 percent 30-Year fixed mortgage since we bought our house in 2005. With rates at historic lows, we, like many people, started looking into refinancing earlier in the year, but had to put it on hold until we got tax extensions, and then returns, filed. When we spoke with the mortgage specialist at Chase in February the conforming loan limit for a two-family house in Brooklyn was just south of $800,000. When we got on the phone yesterday morning we were pleased to learn that the conforming limit had recently been raised to $934,200; the single-family limit is $729,750. We were able to do a 90-day lock for a 1/4 point at 5 percent. Here’s where you have to start to question how low prices can really go: With rates where they are right now, you could, say, buy a $1.2 million house and lock in mortgage payments of $5,000 a month; assume you make $1,500 on your rental and you’re down to $3,500; throw in the tax breaks and you’re down to $2,500; add back in $1,000 a month for taxes and insurance and you’re back up to $3,500. $3,500 a month to own your own house in New York City and have, say, 2,400 square feet of living space for yourself (three out of four floors). The trickier part comes when you need to finance more than that $934,200. Have any readers gotten financing for significantly more than that recently? How did you structure it? We heard from Chase that HELOCs are quite hard to get right now?
05/14/2009 10:45 AM
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Despite Low Interest Rates, Few Refinancings in New York
With long-term interest rates bouncing around near record lows for the last several months, it’s been a great time for home owners to refinance–unless they live in New York, that is. According to stats from Inside Mortgage Finance, while there were 92 percent more mortgage refinancings nationwide in the first quarter of 2009 versus the same period a year earlier, the increase in New York State was only a modest 6 percent. The reasons? First of all, New York has a lot of high-priced real estate, and the best rates are only available on conforming loans ($417,000 and under); if there’s enough equity in your house and your credit score is high enough, competitive rates are available for so-called agency-jumbo loans ($417,001 to $729,750). Secondly, New York State has a painfully high mortgage tax of 2.05 percent, and it’s become harder and harder to avoid in the case of refinancings. Has anyone refinanced a jumbo or agency-jumbo loan in the last few months? What kind of rates and fees did you encounter? What are the best banks to go to in this category?
New Yorkers Miss Refinancing Spree [NY Times]
05/04/2009 9:30 AM
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Tough Times for Getting a Home Equity Loan
Home equity lines of credit (or HELOCs in industry parlance) have gotten harder to get and more expensive when you can get them, according to an article in yesterday’s New York Times. The reason is pretty straightforward: “As the economy and housing market declined, it made little sense for banks to lend money on an asset that was becoming less valuable by the week, and in an environment where borrowers had a diminishing ability to repay.” At this point, you’ll need to have a credit score of 720 or better and be able to prove that you’ve still got 20 percent equity left in your house or apartment; and if the debt service on the HELOC you’re seeking combined with your existing mortgage payments would consume more than 38 percent of your income, you’re likely to strike out. The Times also says that HELOC rates in New York are now around 5.4 percent. Have any readers tried to get a loan like this recently?
Why Credit Lines Are Drying Up [NY Times]
Photo by lactardjosh
Why Credit Lines Are Drying Up [NY Times]
Photo by lactardjosh
04/20/2009 9:30 AM
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bryanx
May 16, 2013 | 09:04 AM