Forget the Open Floor Plan--It's Time to Bring Back Walls

Mortgage forbearance opportunities, while beneficial to borrowers impacted by COVID-19, are putting an  enormous strain  on mortgage servicers of all sizes. Within the last couple of weeks,   Fannie Mae  and  Freddie Mac , along with other  lending institutions , quickly stepped up to respond to the millions of people the COVID-19 pandemic has financially impacted. The White House and the  Federal Housing Finance Agency   even called for  up to 12 months of mortgage forbearance for Americans who can’t pay their bills because of the COVID-19 pandemic. But the challenge with mortgage forbearance is that someone has to pay the bill. According to  Ginnie Mae , which currently holds  29.6% of the outstanding securities  in the agency market, the cornerstone of their MBS Guaranty program “has been and will always be that the investors who support access to affordable mortgage credit for the  U.S. Department of Housing ...

1. Upgrade your lighting You'll need good light since you'll be inside for a while, so consider replacing old bulbs in your living room lamps with energy-efficient LED bulbs, suggests  Ana Cummings  of the eponymous design firm. LED bulbs have a longer life and don't heat up as much as incandescent or fluorescent bulbs, making them safer if accidentally touched. And since you're in the lamp department, take a hard look at the shades on each of your lights. If you have a similar size lamp in another room, swap the shades to give your living room a new look. 2. Hang (or rehang) a gallery wall Photo by Brittany Stiles Design Redoing your wall design is a fast way to upgrade your living room's look—and it costs just about nothing except your time and a few picture hooks and nails. If you've always wanted to try a gallery wall, go for it! If you already have one, it might be time to change it up. Either way, lay your frames on the floor to pl...

A recent report from  Goldman Sachs   suggested  that a record-shattering number of people are filing for unemployment as the coronavirus cripples the nation’s economy. That’s why there’s likely going to be a giant surge in delinquent mortgages as many borrowers are unable to make their next mortgage payment. That’s also why the mortgage industry is  asking  the government to allow mortgage servicers to be able to provide affected borrowers with a 90-day break on their payments. While that solution would require some serious legwork (more on that  here ), the two biggest sources of mortgage financing are giving some leeway to borrowers who’ve fallen behind.  Fannie Mae  and  Freddie Mac  unveiled today a new “payment deferral” option that will allow borrowers facing a hardship to defer two months of their mortgage payments until the end of their mortgage. The program was set to be announced later this year, but with the coronaviru...

This year’s spring home-buying market looks drastically different than what was  originally predicted . The early forecasts for a hot purchase market were instead met with never-before-seen  refinance levels , as  COVID-19  changed the course of the real estate market. Despite these changes, the industry not only remains operational, but it’s  working in overdrive  to meet demand and adjust to the challenges that city lockdowns and social distancing are causing.  One part of the mortgage transaction that’s always been face-to-face is title. Industry demand for  remote online notarizations  and eClosings has moved the needle quite a bit toward automating or digitizing this process, especially over the last month as a bipartisan push to legalize RON nationwide has grown to help business continue during lockdowns. However, the challenges that COVID-19 is creating shows that there are still plenty of business operations that are not comple...

House prices increased 5.2% in January from a year earlier, slowing from December’s annualized gain of 5.4%, according to a report from the  Federal Housing Finance Agency . The  data  is a snapshot of the market before it was hit by the  COVID-19  pandemic, said Lynn Fisher, the deputy director of the division of research and statistics at FHFA. While the disease began spreading in China in December, it didn’t show up in the U.S. until mid-January, via an infected traveler, and the first case of person-to-person transmission in the U.S. wasn’t discovered until late February. “Transactions in January were unlikely to reflect much if any, influence from the COVID-19 outbreak,” Fisher said. “House prices in the Pacific and South Atlantic regions grew somewhat faster over the year ending in January 2020 than observed the same time a year ago.” The FHFA monthly HPI is calculated uses sales prices for single-family houses bought with mortgages sold to or guara...

The common refrain is that millennials are spending all of their money on  avocado toast , which means they can’t afford to buy a home. Right? Yeah, not so much. While millennial spending habits may be a contributing factor, their inability to buy a home can also be blamed on a lack of savings, rising student loan and credit card debt, and homes being unaffordable. The self-proclaimed “broke” generation is trying to be smarter about the housing market, but it’s difficult for quite a few potential homebuyers. One issue is  student loan debt , which is now the second-highest consumer debt category – behind only mortgage debt – and higher than both credit cards and auto loans, according to a report from  Forbes . There are 45 million borrowers who collectively owe more than $1.5 trillion in student loan debt in the U.S. Borrowers  in the class of 2017 owe $28,650 on average, according to the  Institute for College Access and Success . That debt load is mak...

A bill introduced this year in the Washington State legislature would ban single-family zoning across the state, requiring towns with more than 15,000 people to allow duplexes, triplexes, quadplexes, stacked flats, townhouses and courtyard apartments in areas currently zoned for single-family residential. It doesn’t require the construction of multifamily units. Instead, it allows developers to buy a house in an area containing only single-family homes and replace it with an apartment building. The neighbors won’t be able to do anything to stop it.

After  announcing  it would pause all iBuying in California only,  Zillow  has officially put a temporary stop to all of its iBuying practices. Monday morning, Zillow announced it would follow suit to  others , and pause  iBuying  in all 24 markets it operates in. The real estate company said the decision to temporarily pause making offers to sellers comes after several counties and states, including California, Illinois, Louisiana, Ohio, New York and Nevada, have implemented emergency orders requiring people to stay home and all non-essential business activities, including some real-estate related activities, to temporarily stop. On Friday, Zillow said it would temporarily stop purchasing homes in California via its iBuying outlet,  Zillow Offers . “To comply with California’s ‘Stay at Home’ order, we are temporarily pausing purchasing homes through Zillow Offers in the state while the order is in effect,” the company statement said. “The ...

Maybe you dream of baking wood-fired pizzas in a Mediterranean-style backyard. Perhaps you want to lounge by a sleek modern pool or sip wine under an old-world-style pergola covered in roses. Whatever your outdoor ideal, you can ensure that your patio fits your style and needs with thoughtful planning. Read on for tips from landscape designers Greg Koehler and Tony Zambito. Techo-Bloc 1. Select a Theme Nail down your style and color palette before you start to end up with a cohesive design.  Try a fresh modern look with a pattern of smooth  diamond-shape pavers  and warm beiges and grays, as seen here.  Embrace a rustic aesthetic with wood-effect slabs and warm brown cobblestones. Opt for veined sandy-hued pavers, box hedges and white hydrangeas for a Hamptons-inspired space. “The more you personalize your patio, the more you’re going to use it,” says Koehler, the owner of  Outdoor Dreams  in Richmond, Virginia. There’s a world of options fr...

With the coronavirus bearing down on the entire country, it’s likely that more people in the U.S. lost their jobs and filed for unemployment in the last week than in any week on record. The prediction comes courtesy of analysts at  Goldman Sachs , who suggest the country saw an “unprecedented surge in layoffs,” with an estimated 2.25 million people filing for employment in the last week. That would shatter the previous weekly record of 695,000 initial jobless claims (people filing for unemployment), which was set in 1982. It would also be a nearly tenfold increase from the most recent data from the  Department of Labor , which showed that for the week ending March 14, approximately 281,000 people filed for unemployment. According to the Labor Department, that was an increase of 70,000 from the previous week’s unrevised level of 211,000. It was also the highest level for initial claims since September 2, 2017, when it was 299,000. Goldman Sachs’ analysts said that their ...

Prior to coronavirus making its way to the U.S., some things were looking up for the housing market. More specifically, the  first-time homebuyer  market was  very active  in 2019, according to a new report from  Genworth Mortgage Insurance . “The number of first-time homebuyers showed strong year-over-year growth, at a pace not seen since the peak of the last housing cycle in 2006,” the report stated. “For the third consecutive year, the number exceeded two million, which is unprecedented in the past 26 years.” According to the report, first-time homebuyer demographics are maturing, with growth shifting from first-timers to second-time homebuyers. In the fourth quarter of 2019, first-time homebuyers represented 39% of all buyers in the single-family housing market, and 55% of all purchase money borrowers. Overall in 2019, first-time homebuyers represented 38% of all homebuyers in the single-family housing market and 56% of all purchase money borrowers....

We are in the midst of a pretty crazy period with the coronavirus, COVID-19, fouling up the economy and the health of the world. Today's unchartered waters and uncertainty plays havoc on the human psyche. As we learn to cope, all of us can play a part in finding a path to sanity and (almost) normalcy. Last week it seemed like every day brought a new surprise and challenge to the US government and economy. There have been numerous articles about what to do about the highly contagious nature of COVID-19 and I think we may see even more surprises come our way this week. One new challenge that I think is highly likely is that we have a complete shutdown/quarantine of public gatherings, bars, restaurants, etc. This focus on “social distancing” has a pretty compelling analog that took place during the 1918 Spanish Flu outbreak.  Check out  how Philadelphia fared after a massive public gathering versus St. Louis, where all public gatherings were halted. Hint, social distancing works....

Ask any economist if you can shut down the country during a pandemic and still manage to avoid an economic contraction. The answer is no. The American  economy depends on consumer spending , which accounts for about 70% of GDP. While panicked consumers have been stocking up on toilet paper and counter wipes, spending has plummeted at other places like retail malls, restaurants and anything related to travel. GDP growth likely will be zero in the current quarter and contract 5% in the second quarter,  Goldman Sachs  economists said on Sunday. That probably will be followed by a jump of 3% in the third quarter and 4% in the final three months of the year as pent-up demand drives business activity, the forecast said. “The uncertainty around all of these numbers is much greater than normal,” said the group, led by Goldman’s Chief Economist Jan Hatzius. But that doesn’t mean the housing and mortgage industries will suffer the same fate as the travel industry. The mo...

Effective January 3, 2022, the mortgage industry will cease using the long-standing LIBOR and, instead, adopt the new Secured Overnight Funding Rate (SOFR). With billions of dollars in ARM assets tied to the LIBOR index, this will have huge implications for the mortgage industry – and the consumers it serves.  LIBOR, explained Each weekday, at approximately 11 a.m. Greenwich Mean Time, about 11 to 16 large banks (known as panel banks), report the rate at which they believe they can borrow a “reasonable” amount of dollars from each other in the London Inter-bank market. Then, by 11:45 a.m., the average rate is calculated and published. This methodology underscores the unreliability of the approach, as it’s based largely on estimates – versus data – made by a small, elite group of banks. Concerns about LIBOR intensified following the 2008 financial crisis. Reports began surfacing that some banks were falsely  inflating or deflating their interbank rates ...