Wednesday, August 15, 2012

Refi's Up - OrdNo's Up

Over this past weekend, I crossed paths with a friend who works locally for a regional bank.  He asked me what trends I was spotting from the registry.  When I turned the question on him, he was quite optimistic, especially about the volume of new mortgages being written, mostly for refinancings.  Our statistics corroborate his view.

In July 2012, there were 1340 mortgages recorded here at the Middlesex North Registry of Deeds which was a 75% increase from the 765 recorded in July 2011.  The first two weeks in August have seen a similar percentage increase.  The 616 mortgages recorded from August 1 thru August 14, 2012 were 75% greater than the 352 recorded in the same two weeks in 2011.

As good as the news of increased mortgage volume is, it is somewhat tempered by an almost equivalent increase in the number of orders of notice being recorded.  In July 2012, there were 85 which was a 63% increase from the 52 recorded in July 2011.  Similarly, the 56 recorded in the first two weeks of August 2012 where a 55% increase from the 36 recorded in the same two weeks in 2011.

My banker friend suggested that this uptick in foreclosures mostly involved large national banks clearing up a backlog of non-performing loans that had been deferred until the banks cleared up any questionable robo-signing type practices.  If that's the case and this increase is not evidence of a downward turn in the real estate market, then there very well could be reason for some (slight) optimism.

1 comment:

kad barma said...

Thanks, as always, for these great updates!!!

Sadly, a bump in refi's won't increase the amount of credit money available to would-be homeowners, (it's just shifting the deck chairs on existing loans and eating into bank profitability by reducing the rate they're receiving), nor helping to buoy the real estate market. (Nothing changing hands). It's absolutely great for folks getting a break on their monthlies, or gaining free capital for investment elsewhere, (food?), but it's still not getting capital to those parts of the market where it's most acutely needed. (Perhaps the people on the losing end of some of those OON's could use some cheaper credit).

In addition, the scope of under-performing (aka non-performing) assets on bank books is staggering, with continued potential to disrupt the economy as failed banks are brought into the clean disinfecting sunlight of fair valuation. I know of one particular property in Boston that was surrendered as part of a bankruptcy TWO YEARS ago for which the bank has yet to even stop sending cheerful mortgage bills and accept the deed, let alone recognize it's got a white elephant on its hands. I'm sure it'll become one of those OON's before it's finally auctioned off who knows how many years from now. But such sclerosis in the real estate chain will take years to resolve.

Good luck to all of us!