Archive for February, 2017

Flipping Out: House Flips Reach Highest Level Since 2006

Posted on February 28, 2017 by Laura Lam

A tactic that helped define the height of homebuying madness in the U.S. in the years before the market collapsed is rearing its head again.  Home flippers, who buy homes as a speculative bet on short-term price appreciation, accounted for 6.1% of U.S. home sales in 2016, according to Trulia, which defines a flip as a property sold twice in a 12-month period in arm’s-length transactions. That’s the highest share since 2006, when flips accounted for 7.3% of sales. Flipping has made a strong comeback in cities that were battered by the foreclosure crisis. That includes Las Vegas, where 10.5%…

Should You Finance Business Equipment?

Posted on February 27, 2017 by Laura Lam

The vast majority (78%) of U.S. businesses lease or finance their equipment.  The Equipment Leasing and Finance Association (ELFA) has released a new infographic highlighting why this method of equipment acquisition is so popular.  The infographic showcases a variety of ways businesses can use equipment finance to their strategic advantage, including: Finance 100% – Arrange 100% financing of your equipment, software and services with 0% down payment. Save cash – Save your limited cash for other areas of your business, such as expansion, improvements, marketing or R&D. Keep up-to-date – Keep up-to-date with technology by acquiring more and better equipment than you could…

What Does the Average American Spend on Housing?

Posted on February 24, 2017 by Laura Lam

While the cost of college has climbed at an alarming rate over the past 20 years, there remains no purchase more significant — financially or, perhaps, emotionally — than a house. While some have rightly questioned whether the American Dream is worth pursuing, the fact remains that we all need a place to rest our heads at night. According to the Bureau of Labor Statistics’ (BLS) 2014 Consumer Expenditure Survey (CES), the average American household spends about $1,030 per month on rent or mortgage, inclusive of property taxes, insurance, and utilities (not including telephone). That’s roughly 21% of the average household’s income…

2017 Will Bring Modest Economic Growth

Posted on February 23, 2017 by Laura Lam

The Mortgage Bankers Association (MBA) has looked into the future, and they are not complaining.  “We’re expecting steady, modest growth in the U.S. economy,” said MBA Vice President of Research & Economics Lynn Fisher at the MBA National Mortgage Servicing Conference & Expo. “We’re seeing real economic growth in a number of indicators.” Fisher noted that as federal unemployment rates decline, employers may find difficulty in attracting workers to meet specific skill-sets. “This in turn is going to drive up wages,” she said. “Over the next two years, unemployment will fall to around 4.5%, suggesting further tightening on the labor front.” Fisher…

Cybercriminals Target Online Lenders

Posted on February 22, 2017 by Laura Lam

Financial organizations are being increasingly targeted by cybercriminals looking to capitalize on alternative lending and payment models. Although the entire financial services industry is a hotbed for cyber crime, online lenders are particularly vulnerable. They differentiate themselves based on their ability to process loan applications quickly – making them a soft target than some of the larger established banks.  According to the latest ThreatMetrix Cybercrime Report, 1 million cyberattacks targeted online lending transactions throughout 2016, and this number will continue to grow in 2017. The total value of these transactions is estimated at approximately $10 billion. This emerging trend in online lending…

Will Household Debt Hit New Record in 2017?

Posted on February 21, 2017 by Laura Lam

Americans’ debt balances rose “substantially” in the final quarter of 2016, according to the Federal Reserve Bank of New York.   Household debt totaled $12.58 trillion as of December 31, 2016, according to the New York Fed’s latest quarterly report on credit.  Total debt increased by 1.8%, or $226 billion, in Q4. That lifted household debt just 0.8% below the peak reached in the third quarter of 2008 as the US economy was mired in recession. According to the report, Americans borrowed the most money since the recession to pay for new houses or to refinance their mortgages. Mortgage originations in the fourth quarter totaled $617…

Underwater Home Loans Sink to New Low

Posted on February 20, 2017 by Laura Lam

At the end of the year, 2016 held 1 million less seriously underwater properties than the year before, according to the Year-End 2016 U.S. Home Equity and Underwater Report from ATTOM Data Solutions, a fused property database.  Rising home prices and low inventory prices caused home buyers to struggle, however current homeowners reaped the benefits of the increased equity. At the end of 2016, 5.4 million properties were seriously underwater, the combined loan amount secured by the property was at least 25% higher than the property’s estimated market value, according to the report. “Since home prices bottomed out nationwide in the first…

Most Americans Ruin Their Credit by Age 30

Posted on February 17, 2017 by Laura Lam

A whopping 68% of Americans make at least one major financial mistake, or “credit fumble,” before turning 30, leading to a negative mark on their credit report, according to a Credit Karma survey.  These mistakes include overspending on credit cards, missing payments, defaulting on a loan or having an account sent into collections, the survey found. The greater the offense, the longer it will reflect on your credit report, said Bethy Hardeman, chief consumer advocate at Credit Karma. In fact, it usually takes consumers 7 to 10 years to erase negative marks from their credit, thanks to the Fair Credit…

Consumers’ Attitude on Housing Brightens

Posted on February 16, 2017 by Laura Lam

The Fannie Mae Home Purchase Sentiment Index rose 2 percentage points to 82.7 in January, reflecting the more positive consumer outlook following November’s presidential election.  The index is based on the results of 6 questions from Fannie Mae’s National Housing Survey – 4 of the 6 components improved in January from the month prior. “Three months after the presidential election, measures of consumer optimism regarding personal financial prospects and the economy are at or near the highest levels we’ve seen in the nearly 7-year history of the National Housing Survey,” said Doug Duncan, senior vice president and chief economist at Fannie…

Home Sales Close Out 2016 on High Note

Posted on February 15, 2017 by Laura Lam

Hopes are high for this year as 2016 closed out pending home sales on a high note, however low inventory continues to dampen the high spirits.  Pending home sales increased in December by 1.6% to 109, up from 107.3 in November, according to a new report from the National Association of Realtors. That is an increase of 0.3% from December 2015. “Pending sales rebounded last month as enough buyers fended off rising mortgage rates and alarmingly low inventory levels to sign a contract,” NAR Chief Economist Lawrence Yun said.  “The main storyline in the early months of 2017 will be if…