Mortgage News for the Week of June 14, 2019
Almost 1 in 5 American Households Expect to Move in Next Year, Fed Report Says
About 19% of American households surveyed in May expected to move in the next 12 months, according to the Survey of Consumer Expectations report from the Federal Reserve Bank of New York published Monday. That was the highest May reading in two years.

While the share was up from April, it failed to reach the 21.7% set in March that was the highest in data that goes back six years. That was the month that mortgage rates had the biggest one-week tumble in a decade, as measured by Freddie Mac. Since then, rates have continued to  decline , but a growing uncertainty about the economy has caused some Americans to hesitate about bidding on homes. Read more at HousingWire.
The Majority of Consumers are Wildly Wrong About What it Takes to Get a Mortgage
  • The majority of consumers now think it is much harder to qualify for a home loan than it actually is.
  • Consumers either didn’t know or overestimated the minimum credit score needed to qualify for a loan.
  • Consumers also overestimated the required down payment on a mortgage.

After the subprime mortgage crisis and the collapse of the U.S. housing market in 2008, lending standards tightened dramatically. Credit score requirements rose, and most borrowers were required to have skin in the game, in the form of a down payment. Read more at CNBC. .
More Home Buyers are Having Success with Contingent Offers, Even as the Market Heats Back Up
Home-sale, financing, and inspection contingencies are all on the rise from a year ago.
Although the housing market is beginning to heat back up this spring, fewer buyers waived financing and inspection contingencies in May than a year earlier. In May, 14.6 percent of successful offers submitted by Redfin agents waived the inspection contingency, down from 19.8 percent a year earlier. Meanwhile, 11.7 percent of successful offers in May waived the financing contingency, down from 13.2 percent a year prior.

Waiving the inspection and financing contingencies are common strategies buyers use to make their offers more competitive by ensuring the seller that the deal will close and close on time without unforeseen hangups and negotiations. The inspection contingency allows the buyer to cancel the deal if they find an issue during the inspection period that they consider to be a deal-breaker. A financing contingency allows the buyer to cancel their purchase agreement if their financing falls through, for example if the appraisal comes in below the purchase price or the buyer’s finances change before closing. These contingencies are built into standard home purchase agreements as protections for the buyer, so waiving them gives the seller more control and assurance. Read more from Redfin.
Buying Homes in Better School Districts Top Priority for Parents
Fifty-eight percent of parents are willing pay a higher rent or mortgage in order to live in an area that has better schools, according to T. Rowe Price's 11th Annual “Parents, Kids & Money” survey.

While this doesn’t come as a surprise to anyone with school-aged children, there are implications when it comes to overall financial health and long-term home-value appreciation. Read more at Mortgage Professional America.
Mortgage Rate Update
Mortgage Rates Hold Steady
Mortgage rates were mostly unchanged from last week due to easing of trade tensions with Mexico which helped stabilize markets. These historically low rates should provide continued opportunities for current homeowners to refinance their mortgages – which combined with new home buyer activity – will help sustain the momentum in the housing market in 2019.
We hope you enjoyed this week's Market News. For more information about how PMA can help you, please contact us.

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Information and analysis is obtained through third parties and is deemed accurate but not guaranteed. Philadelphia Mortgage Advisors is a licensed mortgage lender by the PA Dept. of Banking and Securities, NJ Dept. of Banking & Insurance, the state of DE, the Florida Office of Financial Regulation, MD Mortgage Lender #23004 and VA State Corporation Commission #MC - 6797. NMLS #128570.
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