From the NYT:
Mortgages insured by the Federal Housing Administration are the go-to product for borrowers who don’t have much cash for a down payment. But the required mortgage insurance premiums have become so costly that some critics argue that the agency is taking advantage of borrowers who have few other options.
One of the most vocal critics is Edward J. Pinto, a resident fellow of the American Enterprise Institute, who calls the terms “predatory” and “abusive.” He argues that the majority of F.H.A. loans are at high risk for default should the economy tip back into recession, but that borrowers have no way of knowing how safe their loans are, because the agency prices all loans the same.
Low-risk borrowers, he said, are overcharged to subsidize those at higher risk. “The consumer who has the very-low-risk loan doesn’t even know he might be better off going through the private sector,” Mr. Pinto said. “They may assume that the government is protecting their interests.”
F.H.A.-backed loans cater to first-time buyers because they require as little as 3.5 percent down. Conventional loans backed by Fannie Mae require a minimum of 5 percent down, as well as private mortgage insurance.
The difference in premiums, depending on the loan type, is considerable. Mark Yecies, an owner of SunQuest Funding, offered an example: On a $300,000 loan with 5 percent down, the F.H.A. would charge an upfront insurance premium of 1.74 percent, or $5,250 financed into the loan. The premium would also add $325 a month; if the borrower put down only 3.5 percent, the premium would be $337.50. In contrast, the same loan with 5 percent down and private mortgage insurance would not charge an upfront fee; the monthly premium would be $175.
Mr. Yecies says that if home buyers have decent credit but are short the 5 percent, he often suggests they ask the seller to pay their closing costs as part of their purchase offer. That way, they can bring more money to the table for a down payment. But “less sophisticated” lenders may automatically usher such borrowers into more costly F.H.A. loans, he said.
David Stevens, the president of the Mortgage Bankers Association, agrees that borrowers are better off with a Fannie Mae-backed loan if they can put at least 5 percent down and have a minimum FICO score of 740. And F.H.A.’s market share has in fact dropped as its insurance premiums have risen. But Mr. Stevens, who served as F.H.A. commissioner from 2009 to 2011, says Mr. Pinto’s argument that the F.H.A. is preying on the poor simply doesn’t hold up. He acknowledged that its underwriting standards were too lax during the years after the mortgage market collapse, when lenders shifted their volume to F.H.A. loans, drawing borrowers with the worst credit and ending up with high delinquency rates.
First, mf’er! Go Magpies.
How about that jobs report…
From the WSJ:
Economists React: ‘Unambiguously Positive’ Jobs Report
–This is an unambiguously positive report and it suggests that the US economic recovery is continuing to generate significant positive momentum. In many ways, this report validates the strong tone seen in the other economic reports and it will add further confidence to the Fed of a reduced need for monetary stimulus in the US economy. As such, we now see the bias shifting in favor of a January tapering announcement, especially if a budget deal is reached in time to avoid another government shutdown on January 15. However, we see a December tapering announcement as a low probability event.– Millan Mulraine, TD Securities
–Despite the fairly robust three-month average pace of payroll growth at 193k and the substantial drop in the unemployment rate to 7.0%, we maintain our view that the Fed will taper its purchases beginning next March. The recent employment data do increase the likelihood that the Fed could taper its asset purchases in December, but we believe the committee will continue to view declines in the unemployment rate as overstating the amount of improvement in labor markets. In addition, we believe the Fed desires to see an acceleration in economic activity and some indication that inflation is returning towards its long-run goal before it begins the tapering process.—Michael Gapen, Barclays
–Before we start hollering for a change in policy at the December meeting, keep in mind the Fed has consistently called for clear, sustained momentum in the labor markets. So the question we have to ask, “Are two consecutive months of +200k enough to establish a trend and definitively prove the labor markets are strong enough to withstand a rollback of QE?” We don’t believe so. 1) Taken in context of the broader economy–while the second-revision of Q3 GDP was stronger on the headline, the details show the consumer sector was even weaker than previously reported. Coupled with lackluster preliminary data from Black Friday weekend sales, the key to the economy, the consumer, appears to be just treading water. 2) And, while +200k is a notable increase from an average of +145k at the end of July, it takes on average +250k a month just to cover demographic change, let alone replace all of the jobs lost during the recession.– Lindsey Piegza, Sterne Agee
–As contrary as it may seem, a meaningful, sustained improvement in the economy – if recent strength were to persist – may not be a positive near-term development for investors. The economy has been in a sweet spot of moderate growth supported by easy monetary policy. Should growth accelerate to the point that the Fed begins to take its foot off the gas, investors could view the policy shift as a catalyst for profit-taking. Nonetheless, while that transition could be bumpy, the benefits of continued growth in corporate profits and a more optimistic global outlook should still be supportive of the markets over the longer term.–Jim Baird, Plante Moran Financial Advisors
–Manufacturing employment has pierced the 12 million mark for the first time since April 2009, with 12,014,000 workers now employed by the sector … Overall, these employment numbers were mostly positive and a sign that the U.S. economy has begun to make some progress after softness in the spring and summer months. This was particularly true for manufacturing, which has seen disappointing job growth since the middle of last year. Despite these gains, though, it is important to note that hiring gains are expected to be mostly modest for the sector moving forward, and this will continue to be true until manufacturers sense that the economy is on a firmer footing and/or demand warrants sufficient additional hiring. –Chad Moutray, National Association of Manufacturers
– To be sure, there are a number of positive trends in the economy … Nonetheless, the economic growth is below par, hardly justifying a healthy and sustained trend. The economy has not created enough jobs to match the pre-recession levels. There are too many workers working part-time involuntarily. The unemployment rate has been falling for the wrong reasons: The labor participation rate is near record low even though the rate inched up in November. The vast majority of the jobs created in this upswing are lower paying service jobs.– Sung Won Sohn, Smith School, California State University Channel Islands
jobs report = lies
How many “dropped out” of the labor force this period?
How many of the jobs created are part-time McJobs?
[1] spine
Cn you believe this?
Since convention has defined economic recovery as full employment, we are clearly in a recovery in that sense. The problem is, the underlying problems within the economy have not been solved. We still run a massive trade deficit. We are still outsourcing existing jobs every single day. Our national, state, and local governments are hopeless addicted to budget deficits. The economic recovery is primarily the function of running huge trade and budget deficits.
7 – Start a factory and make things … I did.
But Grim, why I’m going to start a factory, store, or happy ending massage parlor with a JJ discount; when I can keep my money in a brokerage account and play the market while front running the Fed with its guaranteed 100% market lifting abilities, just got to make sure I keep hearing the music and be ready to bolt out in 10 minutes.
I’m not fighting the fed, you aren’t fighting the fed, so why is everyone else stressing over trying to fight the fed?
You truly are pathetic. You take a point being made and nitpick on one thing and say the whole point is invalid. I weep for your clients.
Fabius Maximus says:
December 6, 2013 at 10:59 pm
#102 Joyce
Put together 30, 35,36 and 45.
I reiterate my pathetic comment. Did you even read the length article I posted which covered everything CNN mentioned (and then some)?
Fabius Maximus says:
December 6, 2013 at 11:07 pm
#103 Joyce
Maybe this will put some perspective on it. http://www.cnn.com/2013/12/06/world/africa/nelson-mandela-other-side/
Because it’s not working.
Grim says:
December 7, 2013 at 11:23 am
I’m not fighting the fed, you aren’t fighting the fed, so why is everyone else stressing over trying to fight the fed?
here’s an idea for many of you w/o Sat nite plans
@NewsBreaker: BEAT IT: Reports say masturbation is good for your health (WATCH) http://t.co/noez2Dbhmp http://t.co/vejyP6xqW6
Grim brought up illegals yesterday. I posed a question to him, why are they here, with responses like Obama Care and poetry. Problem is now you have imported so many from other places that they have diluted your native population and voted in someone who does not care about your best interests. The adults have not done well with our youth, taking advantage of them as well thru advertising garbage to them, then complaining they buy too much I sh*t, peddling credit cards at colleges and high schools just to train them to be good consumers.
I recently read an article that stated most gains have already been made and in the future most profits will only be gained by taking something from another.
Could this be the future? http://www.rense.com/general72/21st.htm
I have every reason to believe that Spine is dead on every time I read his posts.
Not a problem if you are an old goat.
Only a problem if you are young or have kids that you actually care about.
Native population? We killed them all years ago.
Good day for NJRE (& Soccer) R denizens. Toone, Spurs both win.
Con’t [18];
Almost forgot; CP too!
[18] moose,
Only way it gets better is a Gooner loss.
[16] phoenix
“Only a problem if you are young or have kids that you actually care about.”
Yup. Figuratively scared sh1tless over that prospect.
#11 Joyce.
Take a look at this picture. http://www.youreuropemap.com/european_union_map_2008.gif
When you are having a discussion on the Immigration policies of the big blue bit, you can’t use the white bit stuck in the middle as an example.
That’s not nitpicking, that is correcting a common held misconception.
Was Switzerland the only example used? Or was the only thing you could respond to, so you ignored the rest?
#12 Joyce.
Yes I read the piece and the reason I posted the other piece as a perspective, is because you will see a lot of the old right go after Mandela. While it says that the ANC rose to power backed by western nations, it ignores a big fact that those such as Ronnie in the US and Thatcher in UK who stood against them and backed apartheid to the very end.
It is a very right vs left issue and shows how politically naïve the likes of the new Ted Cruz is. He posts praise for Mandela and wonders why his base went nuts.
At some point I expect Jeramiah Wright to come back into the narrative.
#24 Joyce.
No I said that for Finland and Sweden you cant talk immigration without addressing freedom of movement and Asylum seekers. What is the Swedish equivalent of the Mexican farm worker in the US, an Afgan or Kurdish refugee who lands up at the border seeking Asylym. The difference is that countries such as Sweden are set up to process them.
Ted Cruz, like them all, is a criminal sociopath after nothing but power, influence, and money for him and his puppet masters. He is also, at times, as as stupid as the people who believe in left/right. child
Fabius Maximus says:
December 7, 2013 at 4:24 pm
#12 Joyce.
It is a very right vs left issue and shows how politically naïve the likes of the new Ted Cruz is. He posts praise for Mandela and wonders why his base went nuts.
This wasn’t an EU vs US discussion, this was a discussion about our position against the rest of the globe with regards to child poverty and income equality. My examples were taken from countries that routinely rank above the US in both of those measures.
My point still stands, you CAN NOT compare rankings on either of those scales without delving deeper into the restrictive immigration policies of those countries that exist above ours. Without taking into account immigration policy, these rankings are misleading.
I’m not saying that those countries don’t have poor, or don’t have illegals (or even poor legal immigrants), what I am saying is that in comparison to the United States, those countries have FAR MORE RESTRICTIVE legal immigration policies. Those exclusionary policies will UNEQUIVOCALLY result in lower levels of poor residents (and thus a more equal income overall), and fewer children in poverty.
I am not anti-immigrant or anti-immigration. My point is that if we wish to have a more inclusionary immigration policy and continued acceptance of illegal aliens, we have no other choice but to accept our rankings against those more restrictive and exclusionary nations. This is not something that can be fixed.
As long as we open our doors to the poor, and they only open their doors to the rich, we simply can not fight the mathematical inevitability of a lower ranking that will result.
This means that instead of dwelling over the “problem” of income and wealth inequality, we celebrate it. OH MY GOD HE SAID IT. Income and Wealth inequality means OPPORTUNITY.
Not all refugees are poor, in fact, many of them are very wealthy. By law, a refugee must seek asylum in the first EU country they set foot in. How exactly are these folks getting to Sweden? Swimming? You need sufficient means to forge the necessary documentation and travel across Europe to Sweden. Plenty of stories of people spending tens of thousands of dollars to get there. Also plenty of stories about wealthy Iraqis and Syrians in Sweden.
#27 Grim
I get your point that most of the countries that rank above the US in those numbers are European countries. But they differ in that they have minimum standards set by Brussels for every nation in the Union.
http://europa.eu/legislation_summaries/justice_freedom_security/free_movement_of_persons_asylum_immigration/index_en.htm
We can take it as given that HNW can live anywhere and if you have an intellect like Einstein, the acting talent of Hugh Laurie or the golf skills of Rory McIllroy anywhere is an open door.
Would it be better to look at this from another angle and see if there are any groups that have an easier entry into the US than anywhere else in the First world.
joyce/grim: why are you wasting your time with FabMax; although he brings a lot of intellectual firepower to bear, at bottom, he is just a pedestrian troll douche….he’s is anon + 75 IQ points….
+75…You are being too kind to Anon.
#35 Chi
“It is not allowable to arraign the motives of a member, but the nature or consequences of a measure may be condemned in strong terms. It is not the man, but the measure, that is the subject of debate.”
At some point I hope you get a better understanding of that statement.
#33 Lib
“+75…You are being too kind to Anon.”
This always gives me a chuckle . When anyone in here you posts Anon capitalized for me it is “Anon E. Moose ” and not “anon (the good one)”
It totally changes the context of the post and is hilarious.
Sorry Moose!
“The share of the foreign-born population in the total population is especially high in Luxembourg, Australia, Switzerland, Israel, New Zealand and Canada where it ranges from 21% to 42%. In a number of other European countries as well (namely, Belgium, Spain, Ireland, Germany, Estonia, Austria and Sweden), the share is higher than in the United States (13.1%). It has increased in the past decade in all countries for which data are available with the exception of the two most recent members of the OECD, namely Estonia and Israel.
The proportion of foreign-born in the population as a whole roughly doubled over the decade in Spain, Ireland and Norway. Other countries, such as Finland, South Africa and Chile report a low share of foreign- born in the total population but have seen a spectacular increase in recent years.”
Interestingly, Austria which was held out the other day as a country with very strict immigration policy is at 16% of total population being foreign born, 3% higher than the US. Many of whom come directly from the former Yugoslavia and turkey.
Also love how people like to characterize the US as being overrun with uneducated farm hands while every migrant to first world Europe was a member of the literati of their former country. Is a typical school in Albania, Morocco, Turkey or Pakistan equivalent to Bronx Science?
Now if you were trying to say that income inequality of the 1% vs everyone else was pushing the US closer to the South Africa model in terms of child poverty, I would agree. But I wouldn’t blame it on immigration, we are not more overrun with uneducated foreigners than anywhere else.
http://www.oecd-ilibrary.org/docserver/download/3012021ec006.pdf?expires=1386509415&id=id&accname=guest&checksum=298270D10B1505EC67182CF72CFAB495
plume (20)-
Done and done.
“Only way it gets better is a Gooner loss.”
gluteus is a crashing bore who make tedious, pedantic arguments. However, he is valuable to this blog, inasmuch as he serves as a proxy for the mindset of the utterly failed Eurozone. Want to know the mind of the average, post-political, closeted anti-Semite western European? gluteus is your man.
He is also a Gooner (owned since 2004 by Jose Mourinho) fan, which just makes him an object of scorn and occasional pity.
“Some 43,900 asylum seekers arrived in 2012, a nearly 50 percent jump from 2011 and the second highest on record. Nearly half were from Syria, Afghanistan and Somalia and will get at least temporary residency. There was a total of 103,000 new immigrants.
Some 15 percent of Sweden’s population is foreign born, the highest in the Nordic region. Asylum seekers in particular are drawn by Sweden’s robust economy and tradition of helping refugees.”
Looks like they are swimming from Afghanistan to Sweden.
http://www.reuters.com/article/2013/05/27/us-sweden-riots-idUSBRE94Q0E620130527
Baby and daddy rocking out to Bad Religion’s new Christmas EP this morning. She loves it … daddy is proud. Irony aside, the album is fantastic.
[34] Fabian
Fair enough but this isn’t Parliament or the Senate. And need I remind you that you’ve taken up the cudgel of rhetorical fallacy from time to time?
No, I guess they aren’t swimming, turns out they are on luxury cruise liners, from the Telegraph:
Rich refugees pay thousands to flee war-torn Syria in luxury
Amid the jewellery stores and art galleries of a bijou district of Beirut, the travel agent’s office was bustling with customers. Elegantly dressed women wearing Gucci glasses and with manicured nails flicked through glossy brochures advertising Mediterranean cruises and package holidays as they waited their turn.
At his desk the agent worked through customers’ requests: passports could be bought with a bribe; so could many European visas. The journeys could be long, but the travel was safe and tailored for the client’s “maximum comfort”, he assured them.
As thousands of Syrian refugees risk their lives, flinging themselves on overcrowded rubber dinghies, or hiding in livestock transporters to reach Europe, Syria’s rich are smuggled to the continent on planes and luxury cruise liners.
An undercover investigation by The Daily Telegraph has exposed an elite smuggling network which extends from Lebanon and Turkey to top European destinations, including Paris, Stockholm and London. It may cost tens of thousands of pounds, but for those who can afford it, illegal immigration is relatively easy – and it is an option that several thousand Syrians, fleeing the country’s civil war, are already taking.
[37] spine,
geez, clot. You had me excited but then I check the clock and that match hasn’t been played yet.
From the Local (Italy):
Syrian refugees come with ‘money and tablets’
Thousands of Syrians have arrived so far this year in a markedly different type of influx to landings seen since the start of the Arab Spring revolts in 2011.
Scores or even hundreds more arrive almost daily, in what officials say has created an “emergency” in Sicily.
They are usually better off and better connected than the thousands of Eritreans and Somalians who also come and their final destination is Sweden, not Italy.
“They have money and are well-dressed, carrying tablets,” said Carla Trommino, a local lawyer in Syracuse in Sicily where most of the Syrians have arrived.
“They try to avoid identification by the authorities because they want to go to Sweden and not end up in the system of Italian refugee centres,” she said.
…
“We often see relatives waiting with cars on the dock,” said Trommino, who is also a local representative for the immigrant rights group ASGI.
“They stay one or two days and then escape,” she added.
plume (43)-
Wanker can’t beat a Mourinho team. Methinks he won’t be starting tomorrow.
I thought everybody in Bad Religion was dead. Happy news.
N.J. housing market: Where have all the houses gone? Long time coming
http://www.nj.com/business/index.ssf/2013/12/housing_market_where_have_all.html#incart_river_default
The normal effect in a seller’s market is that prices soar. But that hasn’t been the case yet in New Jersey. In a healthy real estate market, home values climb between 3 and 3.5 percent a year. According to the NJAR, the median price in the Garden State rose 5.2 percent in the past year.
“The house has to appraise out,” Banasiak said.
If a selling price is far above a home’s appraised value, banks won’t give a mortgage. It’s one way to keep the market in check.
In the past decade, the number of appeals to lower property values — and lower taxes as a result — increased fourfold, dropping assessments across the state.
“If it doesn’t appraise,” Banasiak said, “does the deal go down the tube? Usually they renegotiate.”
Nearly two out of five homeowners have less than 20 percent equity in their properties, according to data supplied by Zillow.
“People in negative equity are locked out of the market,” said Stan Humphries, chief economist at Zillow.
Another factor that may be keeping homes off the market for the time being is that owners want to make their homes more attractive.
“Borrowers who have gained equity may want to get their property situated so it’s easier to sell,” said Keith Gumbinger, vice president of mortgage research at HSH.com, a Pompton Plains-based publisher of mortgage and consumer loan information.
“Secondary mortgages are climbing up off the bottom,” he said, “and home improvement is usually they main reason people refinance.”
Anon plus 75 points!!! Good one. This site make me laugh very hard some days!
clot, Nom – Is there no such thing as Premier League video highlights? I wanted to see a replay of Cabaye’s goal but it was hard to find a thing. Finally, HufPo, of all places….
http://www.huffingtonpost.com/2013/12/07/newcastle-manchester-united-yohan-cabaye_n_4404394.html
The key difference between most of the low-skill immigrants (legal, illegal, asylum-seekers, whatever) here and in Europe is that in the U.S. – at least among the males – employment levels are higher than for the “natives”; in EU they are drastically lower. Here (use of Medicaid and overburdened schools aside) the social problem with this immigration arises mostly from the wage depression at the bottom end of the market that they cause – thus squeezing out the local low-skill group. In Europe, they realistically won’t hire an African refugee if there are any locals applying, even in Spain with 25% UE rate nobody claims this is because the Moroccans are taking all the jobs – so the social problems arise more from the cultural/religious incompatibility. As a corollary, if you are able to chart the GINI for the native-born, you are most likely to see an increase here and flatline (or much slower rise) in Europe.
Others, aware of the tight inventory, are afraid there won’t be anything out there for them.
“It’s like they’re playing a game of musical chairs,” he said. “They don’t want to leave their seat and walk around in a circle only to find that when the music stops, there’s no chair for them.
I sold mine in a week and looked at the unwanted step child houses for seven months. There was no way I was going to buy an over-priced piece of sh1t in a shit location just because somebody demands it. F.uck you. So, I terminated the contract. Result? One less house for you because there’s no house for me. Multiply that by 10,000 and you have the number of potential sellers in the same position as myself. 8 out of 10 points made in the article describe my situation/game plan.
10,000 Eddies?? Yikes!
So, where is the inventory? How can I make a move when so many fat f.ucks are in negative equity? If you’re not a qualified seller, you’re certainly not getting a lending hand from a qualified buyer. You want a suggestion? Stop eating so much and pay down your debt until you can sell and rent a 2 bedroom in Carlstadt or Lodi.
And the Giants s.uck.
Gary – Get Ready for the next phase. Soon you will see a house or two pop up in what looks like a nice neighborhood, but you won’t figure out until after you buy that it was the only house for blocks that wasn’t already negative equity. Eventually you figure out the score as the prices continue to drop but nobody sells and nobody leaves, including you. I call it the Hotel California phase.
So, where is the inventory? How can I make a move when so many fat f.ucks are in negative equity? If you’re not a qualified seller, you’re certainly not getting a lending hand from a qualified buyer. You want a suggestion? Stop eating so much and pay down your debt until you can sell and rent a 2 bedroom in Carlstadt or Lodi.
I was at a dinner party last night where the conversation shifted to college tuition as we all have kids who are pre-teens. I was astounded how the conversation started out in many different directions with nobody at the table (until I spoke up) questioning the price or value of a a 4 year private school. It was as if “the price is the price, how are we going to afford the price?” One woman even commented, “Are we going to be able to keep up? (with the Joneses)”. Just to try to make her consider price and value I posited the question, what would her family do if the price of Junior College rose to $400,000 per year? She couldn’t comprehend the question. Another friend thought that the government is preying on our kids with high interest rates, why don’t they lower the interest rate to 2%. It was a tough slog to get him to understand that the government loses money on loans, they are guarantors, not bankers. It was even tougher to get him to see that government guarantees only raise the price of tuition. These are educated professionals from non-financial fields. It’s like the group think is that the finish line is just getting your kid *into* a good school. No consideration whatsoever about the overall cost or the current fate of the newly graduated from those institutions. The overall naiveté was pretty scary.
This is a nice listing…”prepper’s compound” as put by the owner, he adds “roses–lots of roses–50 differant roses”…I guess you can’t scare the poet out of the dude
http://cnj.craigslist.org/reo/4217957784.html
Ex-pat: Private college is practically one of the main industries in Boston. Of course the view would be skewed. It pumps so much life into the local economy up there…..in NYC it barely registers….
College? Who needs college when the question is the survival of the human race?
Sad to see that our marginally-educated population now accepts the financialization of everything with no questions asked.
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