Credit Score
By Carrie Bay | 04/06/2012
Mortgage lenders remain cautious in terms of credit quality, down payments, and valuations, as evidenced by the findings outlined in the new Origination Insight Report generated by Ellie Mae. The report series tracks the current lending environment for refinance and purchase mortgages, and it indicates the average credit score for loans approved and closed is steadily rising, while acceptable loan-to-value (LTV) ratios are declining. Ellie Mae says mortgage loans closed in February carried an average credit score of 750, with an LTV of 76 percent.
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By Carrie Bay | 03/28/2012
With today's economic conditions, investors and lenders should expect defaults on mortgages currently being originated - both prime and nonprime - to be 28 percent higher than the average of loans originated in the 1990s, according to the latest UFA Mortgage Report by University Financial Associates. Currently, mortgage default risk is significantly lower than the worst vintages of this cycle - from 2006 to 2008. Loans made over that three-year period are 125 percent more likely to default than loans extended in the 1990s.
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By Carrie Bay | 03/05/2012
Consumer credit data suggests spending will increase and the housing market will begin to emerge from its slump this year, according to Equifax and Moody's Analytics. Both companies note that as key market data align with pre-recession totals, consumers should anticipate steady economic growth for major credit sectors, including auto, bank card, and consumer finance. While the mortgage lending sector continues to see the highest percentage of delinquencies, it too is showing signs of increased traction in the coming months.
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By Esther Cho | 02/15/2012
Overall, the addition of 683,000 new jobs and the best credit picture in more than 15 years helped improve the financial health for the average U.S. household, but these gains were offset somewhat by a decline in net worth and tight household budgets, according to the Q4 2011 report from CredAbility. A score below 70 indicates financial distress, with U.S. households scoring 67.6 on the 100-point scale for this quarter, a smidge higher than the previous quarter, which was at 66.7.
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By Krista Franks Brock | 01/24/2012
Capital Economics expects the housing crisis to end this year, according to a report released Tuesday. One of the reasons: loosening credit. The analytics firm notes the average credit score required to attain a mortgage loan is 700. While this is higher than scores required prior to the crisis, it is constant with requirements one year ago. Banks are also loosening loan-to-value ratios (LTV), which Capital Economics denotes "the clearest sign yet of an improvement in mortgage credit conditions."
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By Carrie Bay | 10/26/2011
The economic environment of the last several years has added to the ranks of first-time defaulters. According to a survey conducted earlier this year by Deloitte, 11 percent of bank customers fall into this category, meaning they have experienced their first default or serious delinquency because of the recent financial crisis and recession. Deloitte contends that servicing and default management strategies should be tailored to match these customers' needs to capture what will likely be a profitable segment over time.
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By Carrie Bay | 10/03/2011
CoreLogic has launched a supplemental consumer credit report to help lenders mitigate risk by uncovering additional debt obligations, as well as increase new lending opportunities by identifying previously hidden credit behavior that could improve a consumer's credit profile.
CoreScore consumer information is merged with traditional credit data into a single, integrated report. The supplemental data is sourced from CoreLogic's proprietary databases, which include nearly 1 billion consumer transaction records.
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By Krista Franks | 08/12/2011
Mortgage delinquencies remain elevated while other aspects of the consumer credit picture, such as bankcard performance, are improving, according to a new report from Experian. The credit bureau says instances of 60-day mortgage delinquencies have risen by 25 percent from 2007, prior to the recession, while 60-day credit card delinquencies have decreased 20 percent since that time. Portland shows the greatest increase in missed mortgage payments, almost double since 2007.
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By Carrie Bay | 07/11/2011
As the second year of CMBS 2.0 begins, credit ratings agencies say they are taking stock of where credit quality stands and where it may be headed from here. With that assessment, conflicting views persist on the strength of the underwriting behind new commercial mortgage-backed securities (CMBS). While the real estate and financial crises invoked a tightening of credit and lending criteria, some say questionable practices, particularly related to appraisal assessments, have begun to make their way back into the picture.
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By Krista Franks | 07/05/2011
Conditions across multiple financial sectors suggest economic stabilization and growth. It's the housing market that's holding back economic recovery, according to the credit bureau Equifax. The company's latest analysis of national credit trends points to shadow inventory and REOs as major mortgage market depressors. Growth in these areas has led to bigger write-offs. Equifax says write-off dollars for home finance in 2010 more than doubled that of 2006 and 2007 combined.
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