Wednesday, February 01, 2012

Misc: REO to Rental Program, New Refinance Plan and Auto Sales

by Bill McBride on 2/01/2012 01:20:00 PM

From the FHFA: FHFA Announces Interested Investors May Pre-Qualify For REO Initiative

The Federal Housing Finance Agency (FHFA) today announced the first step of a Real Estate Owned (REO) Initiative targeted to hardest-hit metropolitan areas announced in August 2011. Investors interested in participating may “pre-qualify” to establish eligibility to bid on transactions in the initial pilot phase as well as subsequent phases.
...
During the pilot phase, Fannie Mae will offer for sale pools of various types of assets including rental properties, vacant properties and non-performing loans with a focus on the hardest-hit areas. The first transaction will be announced in the near-term.
...
FHFA is also looking at ways to improve REO sales to homeowners and small investors, enhancing the existing retail sales strategy at Fannie Mae and Freddie Mac. Both companies sell the majority of their REO properties to owner-occupants at close to market value.
From the WSJ: Obama Announces Refinancing Plan
The centerpiece of the announcement was the refinancing push, which complements an existing program that makes it easier for homeowners with mortgages backed by Fannie Mae and Freddie Mac to refinance.

The new initiative would extend that opportunity to roughly one-third of all mortgages that aren't backed by federal entities and instead are owned by banks or were bundled by private firms that sold them off to investors as mortgage-backed securities. The Federal Housing Administration would instead guarantee the new loan.

To qualify, homeowners would have to be current on their last six mortgage payments and have no more than one delinquency in the previous six months.
This would replace non-GSE loans with FHA insured loans. Since it requires congressional approval, it probably will not happen.

And from the WSJ: January U.S. Auto Sales Jump
Chrysler Group LLC led the way as its January U.S. sales leapt 44% to 101,149 cars and light trucks while ... GM's January sales fell 6%, reflecting deep discounts and new models that fueled sales gains a year ago. ... Ford Motor Co. also said its U.S. sales rose 7.3% to 136,294 cars and light trucks.
I'll post a graph after all the data is released - usually around 4 PM ET - of the seasonally adjusted annual sales rate for January.

Earlier:
ADP: Private Employment increased 170,000 in January
Construction Spending increased 1.5% in December
ISM Manufacturing index indicates faster expansion in January

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