Consumers will be able to calculate mortgage payments within Google searches.
Lenders who were unhappy with the Consumer Financial Protection Bureau’s new mortgage payment calculator will soon have a new target for their ire, Google (GOOG).
That’s because the internet search monolith began very quietly rolling out a mortgage payment calculator of its own on Tuesday. The built-in mortgage calculator will apparently appear when a user searches for terms like, “mortgage calculator,” “loan interest calculator,” and “interest calculator.”
The native mortgage calculator was first spotted by Searchengineland.com. HousingWire searched for Google’s mortgage calculator and found it on an Android-powered phone.
We also captured a screenshot of the tool in action:
While the roll-out of the Google mortgage calculator seems to be limited thus far, Google did share some news on the mortgage calculator on its Google+ page.
“Preparing for homeownership just got a bit easier,” Google’s post states. “Starting today you can ask Google things like ‘How much can I borrow at $200 a month?’ or ‘At 5% APR how much can I borrow over 10 years?’ You can even adjust the mortgage amount, interest rate, mortgage period and more to see which financial options fit your needs?”
Google’s foray into the land of mortgage calculation comes on the heels of the controversial “borrower education tool” from the CFPB. As part of the “Owning a Home” consumer tool, the CFPB included “Rate Checker,” which it touted as a tool to help consumers understand what interest rates may be available to them by using the same underwriting variables that lenders use on their internal rate sheets.
“In other words, we are giving consumers direct access to the same type of information that the lenders themselves have,” CFPB Director Richard Cordray said at the time.
The CFPB’s tool was met with angst from mortgage lenders, including the Mortgage Bankers Association. The MBA suggested the Rate Checker mentions rates and costs without including disclosure items TILA_RESPA rules and the CFPB mandate for borrowers – annual percentage rate, closing fees, etc.
Essentially, mortgage bankers said that if the Rate Checker were a lender advertisement or mortgage calculator, it would violate the CFPB’s disclosure rules.
“It sets borrowers up for severe disappointment,” David Stevens, president and CEO of the Mortgage Bankers Association, told HousingWire. “It should be taken down.”
Stevens says that the tool doesn’t inform borrowers of a host of other costs that lenders are required to disclose under TILA-RESPA, such as closing costs, APR, and other charges and fees, Stevens added.
“This tool has none of that. It gives borrowers none of that,” Stevens said. “It could allow lenders to rate bait the market.”
The third-party tool offers accurate but incomplete information, Stevens added.
The CFPB’s response, in a note to HousingWire, appeared unequivocal. The Rate Checker is not coming down.
“The Rate Checker is an educational tool, and part of a larger suite of tools to help consumers be more informed and effective mortgage shoppers. The Rate Checker does not connect consumers with lenders,” a spokesperson for CFPB told HousingWire.
Other details of Google’s mortgage calculator, such as whether if features details on closing costs, fees, etc. are currently unknown, but HousingWire will continue to monitor the situation to see if Google’s mortgage calculator becomes a permanent feature or just a flash in the digital pan.
By Ben Lane Reprinted from Housingwire
Other recent articles by the Professional Investors Guild:Read More
5.4M properties still underwater as of 4Q14
Some 1.2 million borrowers regained equity in 2014, bringing the total number of mortgaged residential properties with equity at the end of Q4 2014 to approximately 44.5 million or 89% of all mortgaged properties, according to CoreLogic (CLGX).
Nationwide, borrower equity increased year over year by $656 billion in 4Q14. The CoreLogic analysis also indicates approximately 172,000 U.S. homes slipped into negative equity in the fourth quarter of 2014 from the third quarter 2014, increasing the total number of mortgaged residential properties with negative equity to 5.4 million, or 10.8% of all mortgaged properties.
This compares to 5.2 million homes, or 10.4%, that were reported with negative equity in Q3 2014, a quarter-over-quarter increase of 3.3%. Compared to 6.6 million homes, or 13.4%, reported for Q4 2013, the number of underwater homes has decreased year over year by 1.2 million or 18.9%.
“The share of homeowners that had negative equity increased slightly in the fourth quarter of 2014, reflecting the typical weakness in home values during the final quarter of the year,” said Frank Nothaft, chief economist for CoreLogic. “Our CoreLogic HPI dipped 0.7% from September to December, and the % of owners ‘underwater’ increased to 10.8%. However, from December-to-December, the CoreLogic index was up 4.8%, and the negative equity share fell by 2.6 percentage points.”
Negative equity, often referred to as “underwater” or “upside down,” means that borrowers owe more on their mortgages than their homes are worth. Negative equity can occur because of a decline in value, an increase in mortgage debt or a combination of both.
For the homes in negative equity status, the national aggregate value of negative equity was $349 billion at the end of Q4 2014. Negative equity value increased approximately $7 billion from $341.8 billion in Q3 2014 to $348.8 billion in Q4 2014.
Of the 49.9 million residential properties with a mortgage, approximately 10 million, or 20%, have less than 20% equity (referred to as “under-equitied”) and 1.4 million of those have less than 5-percent equity (referred to as near-negative equity). Borrowers who are “under-equitied” may have a more difficult time refinancing their existing homes or obtaining new financing to sell and buy another home due to underwriting constraints. Borrowers with near-negative equity are considered at risk of moving into negative equity if home prices fall. In contrast, if home prices rose by as little as 5%, an additional 1 million homeowners now in negative equity would regain equity.
“Negative equity continued to be a serious issue for the housing market and the U.S. economy at the end of 2014 with 5.4 million homeowners still ‘underwater’,” said Anand Nallathambi, president and CEO of CoreLogic. “We expect the situation to improve over the course of 2015. We project that the CoreLogic Home Price Index will rise 5% in 2015, which will lift about 1 million homeowners out of negative equity.”
Here are some highlights:
- Nevada had the highest percentage of mortgaged properties in negative equity at 24.2%; followed by Florida (23.2%); Arizona (18.7%); Illinois (16.2%) and Rhode Island (15.8%). These top five states combined account for 31.7% of negative equity in the United States.
- Texas had the highest percentage of mortgaged residential properties in an equity position at 97.4%, followed by Alaska (97.2%), Montana (97.0%), Hawaii (96.3%) and North Dakota (96.2%).
- Of the 25 largest Core Based Statistical Areas (CBSAs) based on mortgage count, Tampa-St. Petersburg-Clearwater, Fla., had the highest percentage of mortgaged properties in negative equity at 24.8%, followed by Phoenix-Mesa-Scottsdale, Ariz. (18.8%), Chicago-Naperville-Arlington Heights, Ill. (18.5%), Riverside-San Bernardino-Ontario, Calif. (14.8%) and Atlanta-Sandy Springs-Roswell, Ga. (14.6%).
- Of the same largest 25 CBSAs, Houston-The Woodlands-Sugar Land, Texas had the highest percentage of mortgaged properties in an equity position at 97.7%, followed by Dallas-Plano-Irving, TX (97.1%), Anaheim-Santa Ana-Irvine, Calif. (96.4%), Portland-Vancouver-Hillsboro, Ore. (96.4%) and Denver-Aurora-Lakewood, Col. (96.2%).
- Of the total $349 billion in negative equity, first liens without home equity loans accounted for $185 billion aggregate negative equity, while first liens with home equity loans accounted for $164 billion, or 47%.
- Approximately 3.2 million underwater borrowers hold first liens without home equity loans. The average mortgage balance for this group of borrowers is $228,000. The average underwater amount is $57,000.
- Approximately 2.1 million underwater borrowers hold both first and second liens. The average mortgage balance for this group of borrowers is $295,000.The average underwater amount is $77,000.
- The bulk of home equity for mortgaged properties is concentrated at the high end of the housing market. For example, 94% of homes valued at greater than $200,000 have equity compared with 84% of homes valued at less than $200,000.
By Trey Garrison Housingwire
Other recent articles by the Professional Investors Guild:Read More
Nationwide total listings declined by 6.7% month over month and about 8.7% year over year.
“January’s inventory data suggest a continuation of the tightening trend we identified last month in the December data, and with a shortage of inventory typically comes increased home prices,” Smoke said. “Half of the 200 markets realtor.com tracks experienced year-over-year price increases of at least 6% in January.”
Despite a shortage of inventory nationally, data on the 200 largest markets found a handful of housing markets categorized as healthy and growing.
These markets include: New York-Newark-Jersey City, NY-NJ-PA,;Tampa-St. Petersburg-Clearwater, Florida; Jacksonville, Florida, and Pittsburg, Pennsylvania.
“These four markets are bucking the trend, showing notable increases year over year in total listing counts and median list prices as well as clear declines in median inventory age,” Smoke said. “We will likely see the most sales growth in these markets in the coming months.”
Key monthly indicators for the national housing market include:
- Median list price – $211,000 (Up 8.8% year over year)
- Total listing count – 1,591,853 (Down 8.7% year over year)
- Median age of inventory – 103 Days (Down 4.6% year over year)
By Trey Garrison Housingwire.com
Other recent articles by the Professional Investors Guild:Read More
Two similar pieces of legislation introduced last month in the House and Senate that would extend tax relief to homeowners who are underwater on their mortgage loans have been referred to committees and are waiting to be heard.
Congressman Tom Reed (R-New York) introduced the Mortgage Forgiveness Tax Relief Act of 2015 (H.R. 1002 on February 13, and that bill is now being heard in the House Committee on Ways and Means. Two weeks later, Senators Debbie Stabenow (D-Michigan) and Dean Heller (R-Nevada) introduced a similar bill (S. 608), which is currently in the Senate Banking Committee. Both bills would extend relief to homeowners on forgiven mortgage debt – the remaining mortgage balance when a borrower sells a home in a short sale to avoid foreclosure. The bills would allow homeowners to exclude the forgiven debt from federal income tax forms and not report it as earned income.
Without such legislation, distressed and underwater homeowners would be required to report the amount of mortgage debt forgiven in a short sale as taxable income.
“It is bad enough that so many families in Michigan are faced with mortgages that now exceed the value of their home,” Stabenow said. “But to add insult to injury, without this bipartisan legislation, families willing to work with their lenders will have to pay hundreds or thousands of dollars in additional income tax when they sell or refinance their home. That’s just wrong.”
This is not the first time Stabenow and Heller have introduced legislation to help distressed homeowners. In June 2013, the two Senators introduced a similar bipartisan bill to give distressed homeowners tax relief on forgiven mortgage debt.
Just before Christmas last year, President Obama signed into law H.B. 5771, which retroactively extended 55 tax provisions – including one for distressed homeowners similar to the one that the bills recently introduced by Reed, Stabenow, and Heller. One of those 55 provisions was an extension of the Mortgage Forgiveness Debt Relief Act of 2007, originally signed into law by President George W. Bush, which relieved distressed homeowners from having to pay taxes on forgiven mortgage debt for the three calendar years of 2007 through 2009. That tax exemption was extended three more years until the end of 2012 with the Emergency Economic Stabilization Act of 2008, and it was extended until the end of 2013 with the American Taxpayer Relief Act of 2012. H.B. 5771 retroactively extended the tax break on forgiven mortgage debt until the end of 2014.
The current legislation that has been introduced would extend tax relief to underwater homeowners through the end of 2016. According to a press release on Heller’s website, nearly 17 percent of American homeowners (approximately one out of every six) are underwater on their mortgage loans, which means they owe more than their house is worth. The goal of the bill introduced by Reed is the same as that of the bill introduced by Stabenow and Heller, to “amend the Internal Revenue Code of 1986 to extend for two years the exclusion from gross income of discharges of qualified principal residence indebtedness.”
“Unless Congress acts, those who are underwater in their homes and have received financial relief for their mortgage could be forced to pay a tax on income they never received. This makes no sense, and the legislation Senator Stabenow and I introduced ensures it won’t happen,” Heller said. “As a member of the Senate Finance Committee I look forward to finding a vehicle to pass this important legislation.”
At least one state is attempting to adopt similar legislation for distressed homeowners on state income taxes. Earlier this week, a committee in the North Carolina House of Representatives approved an amendment to bill that would permit homeowners to exclude forgiven mortgage debt when reporting income for state taxes.
Posted By Brian Honea DSNews
Other Recent Posts by the Professional Investors Guild:Read More
Both the delinquency rate and the foreclosure inventory rate in Q4 2014 for residential mortgage loans fell to their lowest levels since 2007, according to the Mortgage Bankers Association’s National Delinquency Survey released Wednesday.
The delinquency rate, which includes loans that are at least one payment past due but not loans in foreclosure, fell to a seasonally-adjusted rate of 5.68 percent in Q4 for all mortgage loans outstanding at the end of the quarter, the lowest level since the third quarter of 2007. The delinquency percentage in Q4 represented a decline of 17 basis points from the previous quarter and 71 basis points from the same quarter a year earlier.
The percentage of loans in foreclosure for Q4 also experienced a sharp decline, down to 2.27 percent – the lowest foreclosure inventory rate since the fourth quarter of 2007. The foreclosure inventory rate for Q4 was down 12 basis points from the previous quarter and 59 basis points year-over-year.
The percentage of loans on which the foreclosure process began ticked slightly upward by two basis points quarter-over-quarter in Q4, up to 0.46 percent. This was still a decline of eight basis points year-over-year, however. The serious delinquency rate – percentage of loans either 90 days or more past due or in foreclosure – fell to 4.52 percent, a drop of 12 basis points quarter-over-quarter and 89 basis points year-over-year.
“Delinquency rates and the percentage of loans in foreclosure decreased for another quarter and were at their lowest levels since 2007,” said Marina Walsh, MBA’s Vice President of Industry Analysis. “We are now back to pre-crisis levels for most measures. The foreclosure inventory rate has decreased every quarter since the second quarter of 2012, and is now at the lowest level since the fourth quarter of 2007. Foreclosure starts ticked up two basis points, after being flat last quarter, largely due to state-level fluctuations in the speed of the foreclosure process. Compared to the same quarter last year, foreclosure starts are down eight basis points.”
According to Walsh, 45 states experienced a quarter-over-quarter decline in foreclosure inventory rate in Q4. Fewer than half of the states saw an increase in 30-day delinquencies, and foreclosure starts jumped in 28 states during the quarter. The foreclosure inventory was roughly three times in judicial states compared to non-judicial states during Q4 (3.79 percent in judicial states compared to 1.23 percent in non-judicial states, according to Walsh. States that used both judicial and non-judicial foreclosure processes reported a foreclosure inventory rate of 1.43 percent.
Posted By Brian Honea DSNews
Other recent posts by the Professional Investors Guild:Read More