November was another good month for jobs with 178,000 new ones created and unemployment dropping to 4.6%. The bad news was that after an encouraging 0.4% gain in October, average hourly wages dropped back by 0.1%.
Flat wages are not hurting home prices–at least so far. They continue to defy forecasts of smaller increases. CoreLogic said October home prices were up 6.7% on an annual basis compared to 6.3% in September. Company president Anand Nallathambi said soaring prices in major metro areas such as Boston, Los Angeles and Denver, “are being fueled by a potent cocktail of high demand, low inventories and historically low interest rates.”
Americans are doing everything from starting their cars remotely, to buying groceries via smart phone these days, so it is not surprising they would like to apply for a mortgage while walking to work. Both doing that and the desire to so it have more than doubled in a year according to a recent survey where Fannie Mae focused on “the mobile mortgage experience.” The company’s earlier survey of lenders found the industry was responding; with more than half of companies expecting to have a mobile app in place by the end of this year.
Even the closing table may soon be an Internet “thing,” something the Consumer Financial Protection Bureau has been advocating for quite a while. E-closings eliminate hours at the closing table and give the consumer private time to thoroughly review loan documents. One hang up has been the sensitivity of creating, signing, transferring, and storing mortgage notes which, as a Freddie Mac spokesman says, must be “a single, unique, unaltered, authoritative copy.” That too is now falling into place. Freddie just gave its lenders a short list of companies certified to have the facilities and expertise to do this.
The FHA and the Veterans Administration followed Freddie Mac and Fannie Mae in raising their loan limits. The VA’s new maximums matched the new GSE limit of $424,100 ($636,150 in high cost areas) for loans with no money down. While FHA’s limits play off the conforming ones, its formula determining them is more complicated.
Remember, loan limits are just that–a maximum loan amount, not a limit on a home’s purchase price. Under the new limits a 20% down payment pushes the maximum home that can be purchased with a conforming loan from the old $520,250 to $530,125. The VA limit is the maximum the government will guarantee. The actual loan can be as large as a lender is willing to make.
For information on your area’s maximum loan amounts, call, or send an email.