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The first is collateral underwriting, which will be implemented by both Fannie Mae and Freddie Mac on January 26, 2015. This will include implementing an automated underwriting system, where appraisals will be fed through a pipeline to determine a rate based on 20 other comparable homes, instead of the typical 3. This will make the job of the appraiser much harder, because he will have 20 comparable homes to drive down rates and will make it harder for them to give higher rates.
The second change we are keeping an eye on is the re-gutting of the quality index. We predict an increase of 12% lesser quality quality loans in 2015, which will cause Freddie and Fannie to be cutting down a little bit on their control.
The 3rd thing we are keeping an eye on is a 12% increase in delinquency filing we saw in December compared to November. This will translate to additional foreclosures and short sales, but probably not until April or May.
Finally, we are keeping a close eye on mortgage interest rates this year. We've seen exceptionally low rates in 2015, but definitely expect rates to rise in the next year due to the Fed's decreased spending. We will be sure to keep you updated on the changes we see in the next year.
So there you have it, a quick market update on what we expect in the coming year. If you have any questions for us at all, feel free to send a quick email or give us a call. We wish you a happy, prosperous, and healthy 2015!
