According to Bloomberg, the jumbo mortgage market is booming while the middle class mortgage market is … dooming?
After lenders raised credit standards following the 2008 financial crisis, many lower-income Americans have been shut out of the market. In January, applications for loans of less than $150,000 to purchase homes fell 12 percent compared with a year earlier, MBA data show.
Total mortgage lending, including refinancing, dropped 39 percent to $1.1 trillion in 2014, according to MBA. Jumbo originations declined 14 percent last year, the smallest drop among all mortgage products, according to Inside Mortgage Finance’s Cecala.
True, wealthy households have other assets that lenders can attach as security. And jumbo loans are not purchase by government mortgage giants Fannie Mae and Freddie Mac.
Unless first time homebuyers can become instant millionaires, I suggest renting.
This all has the feeling of the Jimmy Steward flick “It’s a Wonderful Life” where the bank president (Potter) asks George, the S&L president for additional collateral on a loan.
Last week’s selloff did less damage than it may have felt like. The drop stopped in the area of 3 crossing uptrend lines, ranging in length from short term to long term. Here’s what would tell us whether the uptrend is still in force, or signal that something evil this way comes.
I have added 8 new stocks to the swing trade chart pick list, including 2 shorts.
These reports are not investment advice. They are for informational purposes, for a broad audience of investment and trading professionals, and other experienced investors and traders. Chart pick performance changes week to week and past performance may not indicate future results, as you know. Trading involves risk, and these reports assume that you understand those risks and manage them according to your tolerance.