Mortgage rate lock volume increased by 14% in December

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1. Freddie Mac introduces $2,500 credit for low-income homebuyers

Freddie Mac is introducing a $2,500 credit for low-income homebuyers aimed at easing down payment and closing costs.

“Today’s announcement is a vital lifeline for would-be homeowners, as studies show that down payment and closing costs are among the largest barriers to homeownership for very low-income homebuyers,” said Sonu Mittal, SVP and head of Single-Family Acquisitions at Freddie Mac.

Effective March 1, 2024, this credit will be available to very low-income borrowers who meet specific criteria and are earning 50% or less of the area median income while purchasing a home.

Funds can be used in several ways, including down payment, closing costs, escrow, and mortgage insurance premiums. The credit will be applicable across Freddie Mac's Home Possible® and HFA Advantage® mortgage products.

2. Mortgage rate lock volume increased by 14% in December

Mortgage lock volume increased 13.96% in December compared with November, according to Mortgage Capital Trading (MCT).

It was the first time since June 2023 that MCT observed a month-over-month rate lock increase in total volume, purchase volume, rate/term refinances, and cash-out refinances.

These figures come as the Federal Reserve has decided to maintain interest rates at the current level, with indications that a March rate cut may be unlikely as the Fed persists in its pursuit of achieving 2% inflation.

Maxwell’s Q4 2023 Lending Report Shows Signs of Market Recovery

Wondering what to expect from 2024’s market? Maxwell’s brand new Q4 2023 Lending Report shows powerful signs of market recovery.

In a major reversal, loan volume in Q4 grew year-over-year for the first time since 2021. Plus, the report reveals areas where lenders are finding opportunity, such as through outside-the-box offerings like HELOCs.

To gain exclusive data and learn how to get ahead of the market reset, click here to download Maxwell’s Q4 2023 Mortgage Lending Report.

3. Catch up quick

ℹ️ A 3% mortgage sounds too good to be true. In many cases it is. A deeper look into assumable mortgages. (The Wall Street Journal)

❄️ Here's when rates will fall enough to unfreeze the housing market. (MarketWatch)

💸 Finance of America raises Blackstone borrowing level to $85 million. (BNN)

⚖️ First National Bank caught ignoring Black, Latino neighborhoods in NC. (Fortune)

4. Banks report tightened lending standards

According to a Federal Reserve survey released on Monday, Banks reported having tightened lending standards across almost all categories of residential real estate loans over the fourth quarter of 2023 amid an elevated interest rate environment.

• The survey showed that nearly 15% net share of banks reported having tightened standards on non-qualified-mortgage (QM) jumbo residential loans (14.6%) and QM jumbo loans (15.4%) in the fourth quarter.

• A moderate net share of banks tightened standards on HELOCs (13.7%), non-QM non-jumbo (12.5%), subprime (9.1%), and QM non-jumbo, non-government-sponsored enterprise (non-GSE) eligible loans (11.5%).

In contrast, only modest net shares of banks reported tightening standards on GSE-eligible (5.6%) and government loans (3.8%), for which standards remained basically unchanged.

5. Court blocks Florida law barring Chinese citizens from owning property

A federal appeals court blocked a controversial Florida law restricting Chinese citizens from buying land from being enforced against two people who sued the state, with one judge saying the law “blatantly violates” protections against discrimination.

The 11th Circuit Court of Appeals in Atlanta on Thursday said the Chinese immigrant plaintiffs, represented by the American Civil Liberties Union, have shown a “substantial likelihood of success” in proving their case against the 2023 state law championed by Gov. Ron DeSantis.

Lawmakers in several states including Texas, Louisiana, and Alabama are considering similar restrictions on Chinese citizens owning property. China's foreign ministry said last year that such laws "violate the rules of market economy and international trade rules".

6. Do you know a guy?

☀️ You’re all caught up. See you on Friday!

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