Borrowers No Longer Want Adjustable Rate Mortgages?

Freddie Mac's Quarterly Product Transition Report was released this week and the one of the most staggering finds is that more than 95% of refinancing borrowers choose fixed-rate loans versus adjustable rate mortgages. This even took into consideration the loans that were initially set up as ARMs.

Some other interesting facts regarding this topic pulled from the report include:

• The amount of borrowers who choose to shorten their loan term was the highest since 2003
• Of the total borrowers paying off a 30 year fixed-rate loan, 43 percent reduced down to a 15-to 20-year loan
• Hybrid ARMs became much less popular with 58 percent of ARM borrowers switching to a fixed-rate loan

Further interesting statistics including the Freddie Mac House Pricing Index, the Adjustable Rate Mortgage Annual Survey and the Monthly Refinance and ARM shares can be found at
http://www.freddiemac.com/news/finance/

Deutsche Bank Sued Over $512 Million Worth of Mortgage Backed Securities

According to Bloomberg Businessweek, Deutsche Bank has recently become the new face of misrepresentation of mortgage securities in the court of law. In New York, Deustche Bank AG's Ace Securities was sued for fraud by Phoenix Light SF Ltd. yesterday regarding their alleged misrepresentation of $512 million worth of mortgage backed securities.

The case revolves around misrepresentation of underwriting guidelines which were used to issue the mortgage loans. Phoenix Light is seeking $300 million in damages for securities bought under alleged pretense notions of quality which they then later sold. Phoenix Light is accusing Ace Securities of being aware of the problems with their securities but continuing to include them in the offerings being sold anyways.

Spokespeople from Deutsche Bank claim the accusations are incorrect and they will be fighting the suit.

Mortgage Lender Settlement Annouced Today

The Justice Department has announce today that Bank of America, Wells Fargo, Citigroup, JPMorgan Chase and Ally Financial will pay a $26 billion settlement to American homeowners who have suffered from high interest rates or foreclosure. It is said that about $20 billion of the settlement money will be going to homeowners for mortgage debt reduction and lower rate refinances and about $1.5 billion will be given to previous homeowners who lost their homes to foreclosure between 2008 and 2011.

The banks have three years to distribute the money, therefore creating apprehension by experts of the actual boost this may have on the economy. The breakdown of money to be given by each bank is as followed:

• Bank of America - $11.8 billion plus an additional $1 billion for Federal Housing Administration loans
• Wells Fargo - $543 billion
• JPMorgan Chase - $5.3 billion
• Citigroup - $2.2 billion
• Ally- $310 million

      

New Moble Starter Kit Offered by The Real Estate Book

The Real Estate Book, leading publisher of real estate information in online and print, is noticing the importance of mobile device marketing within the real estate industry. They are now offering a Mobile Stater Kit for all real estate advertisements at no additional cost to the marketers.

The kit allows real estate agents to create their own mobile sites which enables their buyers and sellers to have access to properties, mortgage calculators, links to social media sites and easily accessible search functions.

The Mobile Starter Kit is the latest addition to The Real Estate Book's marketing campaigns for real estate agents which currently includes QR Codes, Text Codes and single property sites.

Facebook IPO To Cause Spike in Residential Real Estate?

Facebook just had a $5 billion initial public offering filing on Wednesday and some think it may effect California real estate. It is being compared to the 2004 public sharing of Google which made many people wealthy and now has stocks trading for $580 a share. Some real estate agents believe that just like with the Google public shares, Facebook's IPO will create wealth and furthermore cause the real estate market to rise. Google's public shares also created jobs which in return caused the company to purchase more land. Speculation is that Facebook's IPO could also create more jobs which could cause a spike in the local residential market.