Our research team releases regular monthly housing trends reports. These reports break down inventory metrics like the number of active listings and the pace of the market. In light of the developing COVID-19 situation affecting the industry, we want to give readers more timely weekly updates. You can look forward to a Weekly Housing Trends View near the end of each week along with weekly coverage from our Housing Market Recovery Index and a weekly video update from our economists. Here’s what the housing market looked like last week.

Weekly Housing Trends Key Findings

• National Recovery Index: The realtor.com Housing Market Recovery Index reached 92.0 nationwide this week, the highest index value since the middle of March when COVID-19 disruptions began. This week’s jump also represents the largest weekly increase in four weeks, taking the index just 8.0 points below the pre-COVID baseline.
• Local Recovery: An additional two markets have crossed the recovery benchmark this week, taking the total number of markets above the January baseline to 10, the highest since the COVID onset. The overall recovery index is showing greatest recovery in Seattle, Denver, Boston, Jacksonville, and Philadelphia, Regionally, the West (99.6) continues to lead the recovery with the overall index now virtually at the January benchmark. The South (93.9), which led the early recovery, is beginning to lag relative to other regions as we head into the summer, with both the Northeast and Midwest (94.5 and 93.6) catching up.
• New listings are down 19 percent. Buyer interest in the housing market has more than fully recovered whether we’re using online traffic or purchase mortgage applications as a gauge. In comparison to buyers, the pace of sellers coming back to the market is lagging which is helping market balance measures such as price and time on market move in a seller-friendly direction. New listings are a crucial pre-cursor to home sales, particularly in an inventory-light market. 
• Median listing prices are now growing at 5.6 percent over last year, more than a percentage point above pre-COVID pace.
• Time on market is now just 13 days slower than last year. While it takes longer to find a buyer and complete a sale compared to this time last year, the gap is shrinking as buyers return and have to move faster to compete for a limited number of homes for sale.
• Total inventory was down 29 percent. The number of homes for sale continues to shrink at a bigger pace relative to last year because buyers outnumber sellers in this unusual summer season.    

Data Summary

	Week ending June 20	Week ending June 13	Week ending June 6	First Two Weeks March
Total Listings	-29% YOY	-27% YOY	-25% YOY	-16% YOY
Time on Market	13 days slower YOY	16 days slower YOY	16 days slower YOY	-4 days faster YOY
Median Listing Prices	+5.6% YOY	+4.6% YOY	+4.3% YOY	+4.5% YOY
New Listings	-19% YOY	-20% YOY	-21% YOY	+5% YOY

Weekly Housing Trends View — Data Week June 20, 2020

Our research team releases regular monthly housing trends reports. These reports break down inventory metrics like the number of active listings and the pace of the market. In light of the developing COVID-19 situation affecting the industry, we want to give readers more timely weekly updates. You can look forward to a Weekly Housing Trends View near the end of each week. Here’s what the housing market looked like last week.

Weekly Housing Trends Key Findings

• Total inventory was down 23%. Signs are pointing to rising home buyer interest, and steeper declines in inventory are on the horizon unless more sellers list homes for sale.  
• Time on market was 17 days slower than last year as it takes longer to find a buyer and complete a sale in the current markets.
• New listings down 23%. With fewer sellers returning to the market compared to a week ago, the yearly declines in new listings remain roughly steady, suggesting that while the general trend is toward improvement, it’s a bumpy road and seller confidence is not quite back to normal yet.  
• Median listing prices have maintained momentum and growth is now closer to pre-COVID levels.

Data Summary

	Week ending May 30	Week ending May 23	Week ending May 16	First Two Weeks March
Total Listings	-23% YOY	-22% YOY	-20% YOY	-16% YOY
Time on Market	17 days slower YOY	16 days slower YOY	15 days slower YOY	4 days faster YOY
Median Listing Prices	3.1% YOY	3.1% YOY	1.5% YOY	+4% YOY
New Listings	-23% YOY	-20% YOY	-28% YOY	+5% YOY

Weekly Housing Trends View

New listings: On the slow path to recovery. Nationwide the size of declines held mostly steady this week, dropping 23 percent over last year, a slight increase over last week but still an improvement over the 30 percent declines in the first half of May. 

More properties will have to enter the market in June to bring the number of options for buyers back to normal levels for this time of the year, nationwide and in all large markets. 
In the first two weeks in March (our pre-COVID-19 base), new listings were increasing 5 percent year-over-year on average. In the most recent three weeks ending May 16, May 23, and May 30 the volume of newly listed properties decreased by 28 percent, 20 percent, and 23 percent year-over-year, respectively. The continued declines in newly listed properties mean we’ve yet to see the full wave of spring sellers return to the market. However, recovery could be on the horizon as three quarters (36 of 99) of large metros continue to see smaller declines this week, including New York and Chicago.

Asking prices: Price gains keep momentum as the mix of homes for-sale continues to revert back toward pricier properties.

In the first two weeks of March (our pre-COVID-19 base), median listing prices were increasing 4.4 percent year-over-year on average. In the most recent three weeks ending May 16, May 23, and May 30, the median U.S. listing price posted an increase of 1.5, 3.1 and 3.1 percent year-over-year, respectively. While current price gains remain below pre COVID-19 levels, we expect them to continue accelerating in the weeks to come as more sellers regain confidence and inventory remains limited relative to buyer interest. Locally, 81 of the largest 100 metros saw asking prices increase over last year.

Total Active Listings: Sellers have yet to come back in full force, limiting the availability of homes for sale. Total active listings are declining from a year ago at a faster rate than observed in previous weeks, and this trend could worsen as buyers regain confidence and come back to the market before sellers.

Weekly data show total active listings declined 23 percent compared to a year ago as the lack of sellers is currently outweighing the extra time homes spend on the market. Signs, such as more purchase mortgage applications than last week and a year ago, are pointing to rising home buyer interest, and steeper declines in inventory are on the horizon unless more sellers list homes for sale to meet rising demand. 

Time on market: While new listings and asking prices are gaining momentum, homes are still sitting over two weeks longer on the market than this time last year. It could take a few more weeks for time on market to reach pre-COVID levels as buyers come back to the market and the pace of sales resumes.
In the first two weeks in March (our pre-COVID-19 base), days on market were 4 days faster than last year on average. The trend in time on market began to slow in mid-March, but the indicator didn’t register an increase until April. Data for the week ending May 30 showed that time on market was 17 days or 30 percent greater than last year, the biggest increase in time on market since 2013. With fewer fresh new properties and buyers taking their time in this strange new world of home searching, sellers should be prepared to wait longer to find a buyer and longer for the transaction to close as well. It’s visible in local data as well as the national figures, with 85 of the largest 100 metros showing similar double-digit percent increases in time on market from one year ago. However, more markets continue to see smaller single-digit increases and could see time on market drop in June, including Dallas, San Francisco and Nashville.

Weekly Housing Trends View — Data Week May 30, 2020

The Covid-19 pandemic is wreaking havoc on the U.S. rental market. Approximately 9 million households have so far failed to pay their May rent, according to industry data. Last month, 1.4 million fewer households paid their rent compared with this time last year.

The country’s 44 million rental households are uniquely vulnerable amid the current public health and economic crises. Renters often lack financial security and legal protections, not to mention bargaining power vis-a-vis their landlords. Worse, many are now being hit by the worst economic downturn since the Great Depression. Low-income renters, especially, work in industries crippled by Covid-related job loss: retail, hospitality and leisure, restaurants, and construction. Data suggests that 16.5 million renter households have already lost income because of the economic shutdown.

Faced with the specter of massive housing loss, policymakers have taken some steps to keep tenants in their homes, not only to help the renters but also as a critical public health measure — after all, it’s hard to comply with a “stay at home” order if you don’t have a home, or to socially distance if you’re forced to move into tight quarters with family or friends. The CARES Act has temporarily protected many renters by providing billions of dollars for emergency housing assistance, significantly expanded unemployment benefits and halted some evictions through July. Dozens of states and cities have also temporarily halted evictions, and citiessuch as Los Angeles, Chicago and Philadelphia are providing emergency funding for tenants.

It appears these stopgaps are working, at least for now: We have not seen as severe a spike in nonpayment of rent as might otherwise be expected, and early rent payment figures from May look a bit more encouraging than April’s numbers.

But these remedies focus on the short term. Because of the scale of this downturn, many if not most unemployed renters will not have new jobs by the end of July. The federal government needs a long-term plan to prevent millions of unemployed renters from losing their homes when eviction moratoriums and unemployment sweeteners run out.

More shutdowns coming

Indeed, public health experts are predicting that the Covid-19 crisis will last well beyond the summer, and some government officials are bracing for waves of shutdowns that could continue for 12 to 18 months. It’s also likely that the U.S. will get hit with another, perhaps more deadly, wave of the virus next winter. When the economy does reopen, it will be in the throes of a deep recession during which millions of middle-income tenants will likely be unemployed and require housing assistance for the first time. Without smart, proactive policies to help millions of unemployed renters, we will be facing billions of dollars in rental debt, chaos at the eviction courts and overcrowded shelters primed for another outbreak.

Renters were struggling before the Covid-19 outbreak amid a well-documented affordable housing crunch. Nearly 40 percent of renter households are rent-burdened — meaning that they spend more than a third of their salary on rent — and two-thirds of renter households can’t afford an unexpected $400 expense.

On top of that, renters have few of the legal and financial protections offered to homeowners. Many states forbid renters from withholding rent even if their unit is in disrepair, most renters have no right to legal counsel during eviction proceedings, and once eviction judgments are handed down, renters can be evicted in a matter of days. And, partly as a result of the subprime mortgage crisis of 2008, federal housing policy heavily favors homeowners over renters. Congress spends approximately three times as much on mortgage-interest reduction as it spends on rental housing vouchers each year. Whereas mortgage holders are protected by the provisions of the Dodd-Frank Act, notably through creation of the Consumer Financial Protection Bureau, no analogue exists for renters.

For the moment, these renters are being kept afloat through a combination of short-term emergency cash, unemployment benefits and eviction bans. But it won’t last past the summer. On top of the one-time $1,200 stimulus check, the extra $600 per week added to unemployment insurance checks expires in July. Unemployment doesn’t cover everyone, notably our 10 million to 12 million taxpaying undocumented immigrants — many of whom are renters — and those working in the informal economy providing child care, cleaning and other services. Another 8 million to 12 million unemployed Americans haven’t even bothered to apply, due to a well-documented backlog of claims and the difficult application process.

It’s not clear what appetite Congress has for extending the current short-term stimulus measures. Lawmakers might choose to extend the $600 per week unemployment sweetener past July. An extra $2,400 per month is more than enough to cover rent for most Americans, and once unemployment offices dig out from the initial crush of claims, delivering this assistance would be an efficient and direct way to keep more people in their homes. Yet Republicans are concerned that these expanded benefits are discouraging people from returning to work, and any such proposal would have to survive tough negotiations.

Meanwhile, the $300 billion recently provided in the most recent stimulus package to keep small business workers on payroll is likely already gone. Temporary rental assistance remains underfunded by tens of billions of dollars, and need is only growing as layoffs continue.

Mom-and-pop landlords

While landlords should be encouraged to reduce payments or implement repayment plans, canceling rent isn’t a viable option for many of them. The prototypical rental unit might be inside a high-rise apartment building owned by a real estate giant, but in fact the overwhelming majority of rental properties in this country are single-unit homes owned by mom-and-pop landlords. These property owners rely on rent to pay their own mortgages, to finance repairs and upkeep of rental properties, and to pay property taxes.

So, protecting tens of millions of renters in the midst of a deep recession won’t be easy. But Congress needs to recognize the importance of keeping rent checks flowing. Delinquent rents could easily spiral into foreclosed units and a consolidation of rental stock similar to Wall Street buy-ups after the Great Recession. That means an increase in substandard housing, worse property management and more marginalized Americans. What’s more, evictions cost U.S. cities hundreds of million of dollars per year. That money should be helping to prop up a struggling economy instead.

But while difficult, it’s not impossible to prevent a rental-housing crisis. Congress needs to expand direct rental assistance. That means cash for rent, sent either directly to landlords or renters.

The National Low Income Housing Coalition estimates that $100 billion in rental assistance would support 15.5 million low-income households over the next year. The Urban Institute’s estimate is about twice that, and accounts for renters of all incomes. That line item’s a drop in the bucket compared to the total stimulus funding Congress anticipates pushing through this year, and will stabilize millions of Americans’ largest household expenditure.

Several mechanisms

There are several mechanisms Congress could chose for this. Cash could be directly provided for rent through the Department of Housing and Urban Development’s existing Emergency Solutions Grant network, in which local services providers administer funds to those at risk of homelessness, or through temporary expansion of the department’s Housing Choice Voucher program, through which local housing agencies pay landlords a portion of low-income tenants’ rent. While some housing agencies might face a flurry of new applications, most unemployed American renter households with zero income would easily qualify.

Alternatively, Congress could attempt to funnel money more directly to landlords. The benefit of this approach is that there are fewer landlords than tenants, and they’re easier to track down. The drawback is that this approach would involve creating an entirely new program. If Congress goes this route, it could model a program on the Treasury Department’s Home Affordable Modification Program (HAMP), focused on landlords’ non-owner occupied homes, or expand the Federal Reserve’s Main Street Lending program to allow lending to the rental industry.

The bottom line is that Congress needs to find a way to inject funding into the rental ecosystem — whether through unemployment insurance, rental assistance or direct payment to landlords. Protecting our renters won’t be cheap, and it won’t be easy. But ignoring the coming crisis will cost billions more down the line in the form of rental debt and landlord foreclosures, and could keep millions of Americans from safely sheltering in place. That’s something we truly can’t afford.

https://www.yahoo.com/news/rental-crisis-coming-avoid-163959843.html

Americans are returning to the housing market, as evidenced by a jump in applications for mortgages to purchase homes, though not at the same level as last year.

A seasonally adjusted index measuring purchase applications rose 6% in April’s last week, compared to the prior week, according to a report Wednesday from Mortgage Bankers Association.

Purchase volume increased for the third week in a row, led by strong growth in Arizona, Texas and California, according to Mike Fratantoni, MBA’s chief economist.

We’re still not back to where we were during last year’s spring market, he said, as about half of U.S. states begin resuming some level of economic activity amid the COVID-19 pandemic.

“Although purchase activity remains almost 19% below year-ago levels, this annualized deficit has decreased as more states reopen amidst the apparent, pent-up demand for homebuying,” Fratantoni said.

MBA’s overall index measuring purchase and refinance applications advanced 0.1% on a seasonally adjusted basis from a week earlier while the group’s refinance index decreased 2% from the previous week – though it remained 210% higher than the same week a year ago.

The refinance share of mortgage activity decreased to 70% of all applications from 72% the previous week, Fratantoni said.

Some of the decline in refi applications is due to pandemic-related job losses that restrict a homeowner’s ability to apply for a new loan, and some has to do with the terms of the mortgages lenders are offering.

“Despite lower rates, refinance applications dropped, as many lenders are offering higher rates for refinances than for purchase loans, and others are suspending the availability of cash-out refinance loans because of their inability to sell them to Fannie Mae and Freddie Mac,” Fratantoni said.

The share of applications for mortgages backed by the Federal Housing Administration fell to 11.1% from 11.5% a week earlier, the report said. The share for home loans backed by the Veterans Administration remained unchanged at 13.3%.

Americans are buying homes again, mortgage data shows

The average monthly payroll calculation is the most important part of the PPP loan application because it not only determines the size of the loan you can apply for, but it’s also the easiest area to make a mistake. We know this because Our Lendee has reviewed thousands of PPP applications in the past few days while discussing the final rule published by the SBAand the application itself with our bank partners. Here is a step-by-step guide as to how to accurately calculate the average payroll number used for the PPP application to ensure that your application is submitted successfully the first time and you get your funding as quickly as possible.

Step 1: Pull the necessary documents.

Although calculating an average monthly payroll number to enter on your application may not be difficult, banks need to see the backup documentation and they will likely prioritize applications that are complete and clearly organized. Payroll registers, tax documents, and even bank statements can be used as documentation for your average monthly payroll calculation. We recommend that you pull documents that are at the intersection of easiest for you and requested by the bank you’re applying to. Keep in mind that the SBA has confirmed that payroll records are sufficient documentation to establish average monthly payroll and we also recommend reading the FAQs published April 7 by the SBA and the Dept. of the Treasury.

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Payroll Documentation

Generally speaking, you’ll need to pull the annual payroll register by employee, either for 2019 or the last 12 months. The report should show gross wages, tips, vacation and benefits payments, and taxes. If you use a PEO or payroll processing software, many have special PPP reports they created specifically for this program. Additionally, while you’re in your payroll system, we recommend downloading a payroll statement for February as the SBA requires proof of payroll as of 2/15/2020.

Here’s our summary of the PEOs / payroll software providers that have provided tailored reports:

Payroll Provider	Link to Special PPP report
ADP	2020 CARES Act SBA-PPP Reports
Gusto	Paycheck Protection Program Report
Justworks	Paycheck Protection Program Report
Patriot Software	I need payroll data for the SBA PPP
Paychex	What Is the Small Business Paycheck Protection Program?
Paycor	Paycheck Protection Program (PPP)|Infographic|Payroll Protection
TriNet	Your Guide to the CARES Act: How to generate a report for your PPP application

Tax Documentation

In lieu of using payroll documents, some businesses have found it easier to use IRS forms 941, 944, 940 and for those self-employed forms 1040, 1099-MISC. Some banks have also been requesting these, especially Form 941. However, Form 941 has two key issues: 1. Many businesses will not have filed their Q1 2020 Form 941 if using the last 12 months period, and 2. if you use a PEO like ADP, Justworks, or TriNet, those organizations file Form 941 for the businesses they serve and those businesses will not have individual forms. 

In summary, most businesses will be better served using payroll documentation.

Step 2: Calculate your gross average monthly payroll and loan amount.

Now that you have your documents you’ll need to use them to calculate your average monthly payroll for 2019 or the last 12 months which determines the loan amount you’ll be eligible for.  If you’re lucky enough to work with one of the PEOs that has a PPP-specific report then you’ll either have the answer or all the required inputs ready to. No matter what documents you’re using, we created a calculator with references that you can use to help you find your loan amount.

Free PPP Loan Calculator – Google Sheets | MS Excel

Common Mistakes to Avoid

• Time period used: It is important to ensure you are using the correct timeframe when calculating average monthly payroll. Determine whether your business classifies as a regular, seasonal, or new business, and use the timeframe recommended on the PPP application under the “Instructions for Completing This Form” section to calculate your average monthly payroll. Most businesses will use calendar year 2019 but some will want to use the last 12 months—both are acceptable.
• Excluded Expenses: The SBA explicitly excludes the following expenses from being factored into average monthly payroll:
  • Any compensation of an employee whose principal place of residence is outside of the United States.
  • The compensation of an individual employee in excess of an annual salary of $100,000, prorated as necessary. More detail on this to follow. 
  • Federal employment taxes imposed or withheld between February 15, 2020 and June 30, 2020, including the employee’s and employer’s share of FICA (Federal Insurance Contributions Act) and Railroad Retirement Act taxes, and income taxes required to be withheld from employees.
  • Qualified sick and family leave wages for which a credit is allowed under sections 7001 and 7003 of the Families First Coronavirus Response Act.

• Employees earning over $100,000: The SBA has issued explicit guidance to exclude any wages paid in excess of $100,000 on an annualized basis to any individual employee. This means that for employees earning greater than $100,000 on an annualized basis, only $100,000 annualized pay ($4,167 on a bi-weekly pay period) can be included in the calculation of monthly payroll. 
• The multiplier: The PPP loan is issued to cover ~10 weeks of monthly payroll expenses (hence the multiplier of 2.5x). Ensure you are correctly calculating (monthly payroll expense x 2.5) to arrive at your requested loan amount.
• Supplemental Documentation: Our recommendation is to submit a brief summary of how you calculated average monthly payroll expense as a supplement to your application. This can be in the form of a simple table in Excel (such as the calculator we provide above). This document should help the bank processing your application to audit your calculation with the goal of expediting the time it takes to approve your loan.

Step 3: Fill in your application and submit.

You can apply through Muevo using our online application and we’ll submit your application to one of our partner banks.  If you have an established relationship with a bank that is accepting applications we encourage you to consider submitting your application through them.

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The housing market is in uncharted waters as COVID-19 continues to upset every aspect of the industry, from see-sawing mortgage rates to canceled open houses due to social distancing rules.

With the chaos and confusion comes a certain amount of unpredictability, a recurring theme among the experts asked to forecast trends for the second quarter of 2020.

The possibilities of what might happen with the housing market, as well as the economy, run the gamut. The answers will be dictated by the virus itself.

— Greg McBrideCFA, Bankrate chief financial analyst

What is certain is that the spring homebuying season will look different than the business-as-normal situation that everyone anticipated at the beginning of the year. Here experts break down five trends consumers should keep an eye on going into the second quarter of this pandemic-plagued year.

• Trend 1: Homebuying will dip for spring
• Trend 2: Homes values will hold steady if COVID-19 is short-lived
• Trend 3: Mortgage rates will likely drop even more
• Trend 4: Refinances will continue to increase
• Trend 5: Digital technology will become even more relevant

Trend 1: Homebuying will dip for spring

The spring homebuying season is headed for a slowdown that will last, at minimum, until summer, experts predict. As the housing gears grind to a halt, fewer people are applying for home loans, a trend that will deepen as Americans stay home by the tens of millions.

Purchase loans fell 10 percent from last week and 24 percent from this time last year in the week ending March 27, according to data from the Mortgage Bankers Association’s (MBA) weekly mortgage applications survey. This drop in purchase loans comes as no surprise as people are asked to shelter in place making it difficult to complete the homebuying process.

Meanwhile, the refinance share of mortgage applications shot up by 26 percent, reflecting the eagerness of homeowners to lock in low rates amid a volatile mortgage environment. In some of the COVID-19 hotspots, mortgage applications were up, but most were likely refinances given the drop in purchases, according to a spokesperson for MBA. New York saw a 16 percent increase and California was up by 18 percent.

The reasons for an anticipated Q2 slowdown are both logistical and economical.

Currently, 75 percent of the country, or 250 million Americans, have been asked to shelter in place. This makes the homebuying and selling process difficult, if not impossible.

Mortgage originations depend on multiple parties, including government entities (which are involved in everything from recording deeds to title searches); so, closed government offices can mean stalled sales.

“If the title companies are unable to record the mortgages and complete their required work due to county and state office closures, loans may be unable to close,” says Heidi Lombardi, licensed mortgage loan originator for American Mortgage in Tampa, Florida.

Likewise, as COVID-19 continues to spread, more appraisers and inspectors will be forced to stop visiting sites, which means lenders won’t be able to fund mortgages.

In strong markets, like Manhattan, which has been one of the hardest-hit areas, listings were down 85 percent at the end of March compared with the same time last year, according to data from UrbanDigs.

“I expect to see a significant decrease in the second-quarter numbers, as will the majority of other businesses, too,” says Rich Schulhoff, CEO of Brooklyn MLS. “Open houses are not allowed and showings have gone virtual. Appraisals are proceeding with limitations. Some appraisers, if allowed by the homeowners, are going into homes while maintaining their distance.”

But the damage may be short-lived

The economic impact will also play a major role in a weak spring homebuying season. A record 3.33 million Americans had filed for unemployment benefits by March 21, and the numbers keep rising. Mass layoffs have created uncertainty, which will trigger lender pullback as well as force some potential homebuyers out of the market, at least for the time being.

The pandemic has penetrated almost every industry, throttling major companies, which has impacted workers all over the country. Marriott, one of the largest hotel chains in the world, is furloughing tens of thousands of workers, and airlines are issuing temporary layoffs of up to 90 percent of their staff.

“While the majority of workers who are being hit hard by the abrupt shutdown of economic activities are generally hourly workers who would not necessarily be in the market to buy a home, the impact has been spreading to salaried workers as well,” says Selma Hepp, deputy chief economist at CoreLogic. “It seems that potential homebuyers who were working in the industries that were most affected will most likely put off the homebuying decision. Also, the volatility in the financial markets will have a negative wealth effect on the higher-earning population.”

The market was strong prior to the pandemic, which could mean that the usually hot spring homebuying season isn’t canceled, but pushed back to autumn, says Lawrence Yun, chief economist at the National Association of Realtors.

“Worth noting that, unlike 2008, there is no subprime lending and overproduction by home builders. Sales will tumble for a few months but prices will hold on. With the stimulus package, any lost sales are likely to show up as a delayed transaction in the second half of the year,” Yun says.

Trend 2: Homes values will hold steady if COVID-19 is short-lived

Homeowners have seen their property value steadily rise, amassing record levels of home equity. In 2019, homeowners with mortgages (approximately 63 percent of all properties) got a notable 5.4 percent year-over-year bump in their home equity, totaling about $489 billion since the fourth quarter of 2018. An average family, with a mortgage, had a total of $177,000 in home equity at the end of 2019, according to data analysis by CoreLogic.

One question for homeowners is what will happen to their property values during this crisis. The answer is uniform across the board: It depends on how long the pandemic lasts. In the short-term, experts agree that prices will flatten, but the long-term effects depend on how deep the shutdown from the virus cleaves into our economy, which could mean the difference between a recession and a depression.

If the impact is limited, with the level of infections dropping dramatically within the next four to six weeks, the recession should be six to nine months in length and the impact on home price depreciation limited,” says Pat Stone, executive chairman and founder of Williston Financial Group in Portland, Oregon. “Should the pandemic extend and homebuying remain depressed, we will see noticeable declines in home prices. In either scenario, once we regain upward economic momentum, home price appreciation will regain pace.”

Another possibility is that only the most afflicted areas will experience a hit to home prices, especially if that area’s economic drivers (hospitality, for instance) are distressed.

Signs are good, however, for a full rebound, Hepp says, citing pent-up demand and very limited for-sale inventory across the country as two indicators that the market is poised for a strong recovery.

Low mortgage rates will also help bolster home sales as activity resumes, which will help keep home prices up. Also, if sellers can wait to sell, then they might maximize their profit if the economy gets back on track by fall.

“For Q2, I expect much lower volume of course, but not an immediate dramatic impact to pricing,” says Todd Teta, chief product officer at ATTOM Data Solutions. “Some sellers will panic and take lower prices; some will take dramatic discounts; most sellers will wait it out.”

Trend 3: Mortgage rates will likely drop even more

Mortgage rates have been on a roller coaster, whipsawing experts and consumers alike. Untethered by normal market levers, such as following the plummeting yields of the 10-year Treasury note, rates have risen and fallen seemingly unpredictably. In retrospect, the reasons are more apparent.

With rates touching new lows, the lender pipelines became clogged, and lenders had to raise rates to stave off more business from people who wanted to refinance or lock in a purchase loan. The erratic rate movement in March occurred as lenders were shying away from mortgage-backed securities, or MBS. Lenders typically trade these securities to hedge their risk of rates changing between the time a borrower makes an application and the closing. The MBS market froze up as the financial markets cratered and buyers became scarce.

In response, the Federal Reserve has employed quantitative easing, or QE, by injecting billions into the MBS market, to ensure that mortgage rates stay low. The Fed has written a blank check, promising to buy billions in agency MBS, which come from Ginnie Mae, Fannie Mae and Freddie Mac.

Experts say this move will help put mortgage rates back into balance, helping to push them into the low 3 percent range during Q2.

“With many policies the Federal Open Market Committee (FOMC) has put in place to ensure the continuation of economic activity and market liquidity, mortgage rates are likely to reach new lows in the coming weeks and months,” Hepp says. “The recent stress put on the financial system led to a bump in rates in recent weeks, but the rates should drift down again. Heightened uncertainty is causing a large variance in mortgage rates forecast through 2021, though many expect the rates on 30-year fixed-rate mortgage to hover around 3 percent or fall lower.”

Trend 4: Refinances will continue to increase

As mortgage rates fall, the number of homeowners who can save money by refinancing expands.  If, for example, rates fall to 3 percent, some 19.4 million homeowners will be refi eligible, according to mortgage data analysis by Black Knight.

Moreover, the incentive to refinance climbs with the amount of money borrowers can save. Currently, 50 percent of outstanding mortgage debt has an interest rate of more than 4 percent, while 24 percent of borrowers have interest rates north of 4.5 percent, according to CoreLogic.

Prepayments rose by 8 percent in January as refinance activity picked up speed, according to Black Knight, and this momentum isn’t expected to slow.

“I’d summarize that the second quarter is going to continue to see a wave of refinancing applications,” McBride says.

Equity-rich homeowners might consider cash-out refinancing as an option if their income was impacted by the coronavirus, McBride adds, especially for those who are long on equity but short on savings.

However, lenders will still run credit and employment checks, so borrowers who are out of work probably won’t qualify for cash-out refinancing.

“COVID-19 could affect cash-out and home equity lending later in the year if housing prices decline because borrowers will have less available equity,” says Jerry Schiano, founder and CEO of Spring EQ in Philadelphia. “That said, program guides have been cut and if people have a cash need for future home improvements or major expenses like weddings or tuition, and they are still employed, I would suggest borrowing now. If they are unemployed the loans won’t close.”

Trend 5: Digital technology will become even more relevant

In a contactless society, contactless technology is king. Lenders and borrowers, forced to keep their distance due to COVID-19, are now relying on a host of remote technology options to conduct business.

It’s now more important than ever for both private companies and government agencies to begin adopting widely accessible online tools like e-signatures, mobile image capture, digital documentation, automated valuation models, remote online notarization and e-closings. Those who don’t will get left behind, experts warn.

“Given the surge in refi demand appraisers are high in demand. Inspections require creativity, like pictures along with a discount mitigation,” says Jarred Kessler, CEO at EasyKnock, a proptech company that offers sale-leaseback of homes. “The bigger, and more frustrating issue, is many counties have not adapted to e-signatures and there is no better time than now to approve it while some court systems are shut down.”

Buyers and sellers are also using video technology to show houses, which can be especially helpful for buyers who have to move due to job relocations, for example.

“Right now, no one wants people in their homes, so interest in video tours has shot up while open houses have been canceled,” says Ilyce Glink, the author of “100 Questions Every First-Time Home Buyer Should Ask.” “Closings are now happening virtually or in drive-by mode, where buyers don’t even get out of their cars. I think you’ll see a lot more of that.”

https://www.bankrate.com/real-estate/housing-trends/?pid=email&utm_campaign=ed_ho_housingtrends&utm_medium=email&utm_source=email&utm_adgid=1121881

Economic Injury Disaster Loan (EIDL) Existing Program 

• Click Here To Apply
  Loan Amounts up to $2,000,000
• 3.75% Interest rate for For-Profit Businesses
• 2.75% Interest rate for Non-For-Profit Businesses
• Loan Terms will not exceed 30 Years 
• Collateral required is only when the loan is over $25,000
• Credit History: Must be acceptable to SBA and show the ability to repay.
• Only available in states with SBA approved declarations of disaster.  Check to see if your area is on the list, click here.
• If you receive the EIDL, you will not be eligible for the SBA 7(a) Relief Loan

*Our sources indicate that there are currently over 25,000 applications submitted so far, with at least 3-weeks  for approvals to be processed. It can be assumed that approval times will only increase as more applicants apply

Get a $10,000 Emergency Advance 

You can get up to a $10,000 grant from the SBA for your small business while you wait for your larger CARES Act Paycheck Protection Program (PPP) Loan or SBA Economic Injury Disaster Loan (EIDL) Follow the below steps:

• Go to https://covid19relief.sba.gov/#/
• Fill out the application
• On the page titled “Additional Information”, make sure to click on “I would like to be considered for an advance of up to $10,000”
• Complete application

*This grant provides an emergency advance of up to $10,000 to small businesses and private non-profits harmed by COVID-19 within three days of applying for an SBA Economic Injury Disaster Loan (EIDL).  

**If you’ve applied for CARES Act PPP financing with us, your place is safe in our queue. Although your application is on-hold pending SBA guidance, we are working diligently to complete your file for an assignment, underwriting, and funding as soon as possible.

SBA 7(a) Relief Loan (Paycheck Protection Program) New Program – CARES Act 

• Click Here To Apply
  Loan amounts up to $10,000,000**
• .5% Interest rate for For-Profit and Non-For-Profit businesses
• 2 year full payout loan, and payments may be deferred for 6 months
• Unsecured and no personal guarantee
• No minimum credit score requirements
• Eligible for loan forgiveness***
• Can only be used for payroll support including medical leave, costs related to health benefits, employee salaries, mortgage payments, rent, utilities, insurance, and any other debt payments incurred before 2/15/2020
• No prepayment penalties
• SBA guarantee fees and lender fees are waived

*A borrower with a current EIDL loan can only also receive the SBA 7(a) Relief loan if the EIDL loan is unrelated to COVID-19

**The maximum loan amount is the lesser of $10,000,000 or the product obtained by multiplying average total monthly payments for payroll costs during the 1-year period before the loan is made by 2.5. So if the loan was made on April 1, 2020, and average monthly payroll costs for the period April 1, 2019, to April 1, 2020, were $1,500,000, the maximum loan amount would be $3,750,000. Payroll amounts over $100,000 per person, will be excluded from the calculation

***Small businesses that take out these loans can get some or all of their loans forgiven. As long as employers continue paying employees at normal levels during the eight weeks following the origination of the loan, then the amount they spent on payroll costs (excluding costs for any compensation above $100,000 annually), mortgage interest, rent payments and utility payments can be combined and that portion of the loan will be forgiven. Any loan amounts not forgiven at the end of one year are carried forward as an ongoing loan with terms of a max of 10 years at 4% interest. The 100% loan guarantee remains intact.

Lending Terms

Muevo Investments is dedicated to working with real estate investors, contractors, REO Agents, rehabbers and commercial property owners to help them acquire real estate financing. Our Lender’s make underwriting decisions based on the individual merits of each loan request, not on applicants’ past credit history. As a commercial lender, any loan application will be considered that is backed by a commercial property.

Length of Loan

Flexible loan terms from 9-36 months.

We also have longer term loans available with 30-year fully amortized fixed rate loans.

Borrowing Entity

All borrowers must close in the name of an LLC

Lien Position

First mortgage position.

Loan to Value

Up to 80% of contracted purchase price for purchase transactions

Up to 75% LTV of the as-is value for refinance transactions

Interest Rate

Rates ranging from 6.75 to 12%, and long term products with rates that start at 4.49%.

Loan Size

$25,000 to $10,000,000

Loan Advances

Funds will be forwarded in draws of 1 to 4 advances to be determined by us. Funds will be wired by direct deposit into an account provided by the investor. An on-site inspection to determine current progress of the project may be required prior to release of funds. A sub-contractor guarantee may be required.

Prepayment Penalties

No prepayment penalties.

Loan Origination Fees

1 to 4 Points

Items for Underwriting

• Loan Application 
• Signed most recent year tax return
• Summary of work to be completed (if applicable)
• 2 months most recent bank statements
• 2 most recent pay stubs (if applicable)
• Rent rolls and copies of all rental agreements (if applicable)
• Form 4506-T
• Personal Financial Statement (We will provide form)
• Borrowers Credit Authorization form (We will provide form)

Additional Items Needed to Close

• Title Policy (obtained by borrower’s attorney) insuring marketable title
• Signed purchase & sales agreement
• Hazard insurance binder
• Current year property tax statement showing taxes paid in full through closing
• Appraisal (obtained by us paid by borrower)
• Borrower’s counsel’s opinion letter
• Voided check to set up ACH payments

All Loans Must Close in an LLC or a Corporation

• Articles of Incorporation/Organization
• Corporate / LLC resolution authorizing the loan, and the officer(s) authorized to execute the loan documents
• Corporate bylaws or LLC Operating Agreement (resolution required)
• Certificate of Legal Existence
• Copies of Partnership / Trust Agreement

• The average rate on the 30-year fixed loosely tracks the yield on the 10-year U.S. Treasury bond, but it is no longer keeping up. The 10-year plummeted to yet another record low overnight, but mortgage rates, while also at a record low, are slower to fall.
•  One borrower who called Bank of America on Saturday was told there would be a two-hour wait to speak with a loan officer.  
• “It’s absolute pandemonium,” said Matt Weaver, vice-president of sales at Cross Country Mortgage. “The industry right now is certainly inundated with requests. Let’s put it this way, we are like Home Depot during a hurricane.”

A sharp drop in mortgage interest rates has sparked a sudden and unexpected refinance boom that has lenders large and small scrambling to handle the volume.

That stress on the lending market, as well as increased risk to mortgage investors from all those refinances, is actually keeping mortgage rates higher than they could be.

The average rate on the 30-year fixed loosely tracks the yield on the 10-year U.S. Treasury bond, but it is no longer keeping up. The 10-year plummeted to yet another record low overnight, but mortgage rates, while also at a record low, are slower to fall.

Mortgage rates hit 3.11% on Monday, according to Mortgage News Daily.

“Demand has ramped up in a way that many lenders have never experienced,” said Matthew Graham, chief operating officer at Mortgage News Daily, which tracks rates every morning. “Some of them have taken to raising rates in order to deter new business.  Others have completely stopped accepting new applications.”

One borrower who called Bank of America on Saturday was told there would be a two-hour wait to speak with a loan officer.  

At Cross Country Mortgage, a small lender in Boca Raton, Fla, phones were ringing before 8 am Monday. They have increased hours and are trying to find more staff to handle the volume, which is now triple the usual.

“It’s absolute pandemonium,” said Matt Weaver, vice-president of sales at Cross Country. “It is a supply and demand situation. The industry right now is certainly inundated with requests. Let’s put it this way, we are like Home Depot during a hurricane.”

Weaver says his firm is able to lower rates more than the bigger banks, because it has less volume, but there are also unusual profit and risk scenarios at play.

“It’s very complicated as to why mortgage rates aren’t a lot lower. One reason is lenders are dragging their feet, more for profit reasons than for concerns about handling the volume,” noted Guy Cecala, CEO of Inside Mortgage Finance. “If a lender’s costs of funds – either from MBS (mortgage backed securities) pricing or deposits – moves lower, but they keep mortgage rates higher than they normally would be, they profit off the larger than normal spread.” 

Weaver agrees that lenders have to watch their profit margins, along with the added volume.

“In these low times of course lenders have the juggling act of balancing margin vs. market demand, vs. the 10-year Treasury,” said Weaver, who added that his firm needs to handle pricing in a way that makes sure “profitability still remains there.”

At the big banks, rates are slightly higher than at smaller lenders. While no one we contacted would comment on why, they did speak to the enormous volume.

“We’ve paused email marketing campaigns on refinancing due to the thousands of customers who are already aware of the low rates and applying for them on Chase.com,” said Amy Bonitatibus, Chief Marketing Officer, Chase Home Lending. 

A Wells Fargo spokesperson said they are ramping up staff to deal with the onslaught.

“We continue to hire underwriters, processors and closers into our fulfillment group and we’re also executing on opportunities to shift team members from other non-fulfillment groups into our fulfillment operation,” said Tom Goyda, a spokesman for Wells Fargo.

And as for rates: “Lenders look at a lot of factors when setting mortgage rates and they are most directly tied to MBS yields, which have seen a widening spread relative to the 10-year Treasury yield,” added Goyda.

Investors in mortgage-backed bonds are at increasing risk because so many people are refinancing. When a loan is refinanced, it is paid off early, and the investor loses out on several more years of interest rate payment returns. As the risk rises, they will pay less for those bonds and therefore the yield on MBS rises – and mortgage rates rise.

“Investors are so spooked about what is going on that they don’t care about yield and are ignoring MBS and sticking with just Treasury bonds,” added Cecala.

It will take “time and market stability,” to get mortgage rates back to following the 10-year Treasury, said Graham. 

“If these Treasury yields become common, lenders can gradually lower mortgage rates without risking rampant refi activity,” he said.  “Eventually, mortgages would return to a normal distance from Treasuries.”  

https://www.cnbc.com/2020/03/09/mortgage-rates-could-be-lower-but-lenders-struggling-to-keep-up-with-demand.html