Lenders clamp down on inflated appraisals

Lenders clamp down on inflated appraisals: "NEW YORK -- May 26, 2005 -- With home prices climbing at a double-digit pace in many parts of the country, lenders are increasingly worried about inflated appraisal values - and some are taking steps to clamp down.

U.S. Bank Home Mortgage, a unit of U.S. Bancorp, has increased the number of in-house appraisers on its staff roughly 40 percent in the past 18 months - cutting down its reliance on outside appraisers. The Minneapolis lender also os doing more audits of appraisals produced by outside firms, particularly in areas where home prices have been climbing rapidly"

New mortgage guidelines planned

New mortgage guidelines planned: "NEW YORK -- May 23, 2005 -- Concerns about risk to the mortgage market and buyers has prompted federal regulators to work on new guidelines for residential lending, which could be available in early 2006.

After recently issuing first-ever guidelines for credit-risk management of home-equity loans, federal regulators now are focusing on first mortgages to address the increasing number of consumers turning to adjustable-rate mortgages, interest-only products, low- or no-documentation loans, and option adjustable rate mortgages (ARMs).

There is growing concern that borrowers are using these loans to qualify for more expensive houses and that the mortgages are ending up in the hands of people who cannot really afford the monthly payments. A study by the Mortgage Bankers Association found that ARMs, not including interest-only ARMs, accounted for 46 percent of the dollar value of mortgages lent during the second half of 2004; while interest-only loans accounted for an additional 17 percent of originations.

Source: The Wall Street Journal (05/19/05); Simon, Ruth; Hagerty, James R.

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Mortgage rates at lowest level since February

Mortgage rates at lowest level since February: "WASHINGTON -- May 20, 2005 -- Rates on 30-year and 15-year mortgages this week dropped to their lowest levels since late February, offering a bit of good news for people wanting to buy a home. "

Housing starts surprise with an 11 percent climb

WASHINGTON -- May 17, 2005 -- U.S. housing starts rose 11.0 percent in April, again surprising experts who continue to expect a slowdown in home sales. Building permits, an indicator of future housing starts, also rose. The change follows a slowdown reported last month.

Housing starts rose for both single-family homes and multifamily housing, according to the U.S. Commerce Department. April housing starts ticked upward to 2.038 million units, compared to March's 1.836 million units, which was revised downward. Economists on Wall Street had predicted a rise in home starts, but only by about 7.8 percent.

Single-family home starts rose 6.3 percent to 1.635 million, following a drop of 14.9 percent in March. Multifamily housing starts -- housing with two or more units -- surged 35.2 percent in April following a 29 percent drop in March.

Building permits rose 5.3 percent to 2.129 million units, a significant increase over Wall Street analyst predictions of a modest 0.6 percent increase.

The greatest strength in new housing came in the South, where construction rose 25 percent in April for its biggest monthly increase since July 1995 when it hit 29.5 percent. In the Midwest, starts rose 6.2 percent; in the West, they rose 2.5 percent. Housing starts fell in the Northeast by 17.8 percent.

Rates on 30-year mortgages decline

Rates on 30-year mortgages decline: "WASHINGTON -- May 6, 2005 -- Rates on 30-year mortgages fell for a fifth consecutive week even as the Federal Reserve was boosting short-term rates."

No end in sight for interest rate hikes

No end in sight for interest rate hikes: "WASHINGTON -- May 4, 2005 -- The Federal Reserve, worried about rising inflation, pushed a key interest rate higher Tuesday and signaled that Americans' borrowing costs are likely to keep climbing in the months ahead."