FHA Mortgages:  Try not to be one of the 40,000-50,000!


Above photo – courtesy of Matthew Staver/Bloomberg via Getty Images


(Photo by Justin Sullivan/Getty Images)

 

 

 

 

 

 

 

Home ownership is the key asset for most homeowners.  To help fund the purchase of a home, FHA (Federal Housing Administration) has been a vital mortgage program to help define middle-class status.

The mortgage crisis of 2008 forced many leaders to shut down.  However, it was the FHA program which became a safety zone for borrowers needing legitimate financing featuring low down payment.  It also allows lenders who were on the fringe to use the program to help stabilize their business.

 

Recently FHA made some changes to the program.  It has been the projected approximately 40,000-50,000 borrower per year will be affected and some in that population are in jeopardy in being able to ultimately qualify for a mortgage.  Due to current mortgage data there has been an increase in borrowers opting for cash-out.  Additionally, debt-to income levels have seen an increase and overall credit scores have declined.

 

“We have continued to endorse loans with more and more credit risk,” said FHA’s Chief Risk Officer Keith Becker. “We felt that it was appropriate to take some steps to mitigate the risks we’re seeing.”

 

Those factors are just three highlighted by FHA now requiring those who may be considered less creditworthy but still in the ballpark of qualifying for a mortgage will no longer be able to use automated underwriting.  Instead, due to their marginal circumstance, their loan package must now be manually underwritten.  For lenders going back to the traditional process will be costlier to them due to the time required to conduct the underwriting.  Due to the manual process, lenders may not be as eager to approve the loan fearful in the event of default their decision could be challenged and result in buy-backs or other negative impacts, which could affect their business.

 

“it’s likely that many of the loans flagged for manual underwriting won’t end up passing muster.”  Chief Risk Officer Keith Becker, FHA

So, while owning a home is still considering “the American Dream” the key to making it a reality is making sure your credit package is not part of the projected population.  Of course, for some they very well may be willing to take a chance and go through the manual underwriting gauntlet as some will be successful.

Donald Trump cleared by Mueller report


The long-awaited Special Counsel report produced by Robert Mueller was delivered to Attorney General William Barr this past Friday.  Donald Trump, his administration and band of supporters are claiming victory that the report did not find him conspiring with the Russia government during the 2016 presidential election.

But, did the Mueller report really clear him?  As predicted, Trump and his pundits which have flamed throughout media have misstated the conclusions reached by claiming he has been totally exonerated.

 

“Mueller did not find Trump or his campaign conspired with Russia, also did not exonerate him on obstruction”

The spin

WASHINGTON, DC – MARCH 24: (CHINA OUT, SOUTH KOREA OUT) U.S. President Donald Trump speaks to members of the media as he returns to the White House after spending the weekend in Florida March 24, 2019 in Washington, DC. Trump returns to Washington as Special Counsel Robert Mueller has concluded his investigation into allegations of Russian interference in the 2016 presidential election. (Photo by The Asahi Shimbun via Getty Images)

While team Trump spins the news that they have been absolutely vindicated by the report, a closer evaluation shows a much different summary.  Prior to Robert Mueller being pulled in to investigate allegations against Trump, for the most part his life was private, especially those related to his financial dealings.

No report would have been necessary…….

Once he summarily fired James Comey, he inadvertently triggered the investigation as we know it.  During that period of countless tweets, threats and other commentary never seen before by a United States president became an unfortunate side show.

 

Unfortunately for Trump, yes Mueller did not find a conspiracy with the Russian government.  But what Mueller did find and was crafty enough to move from his specific mandate, was uncover a long history of Trump behavior which have led to criminal investigations.  The Mueller report has completed and those actions will not be handled by the Special Counsel’s office.  Instead other jurisdictions have taken the baton which have more freedom in their pursuit of justice and the end result is Trump is now more vulnerable than if the report had not been initiated in the first place.

The bigger picture

So, while Trump’s opponents voiced dismay of the Mueller report not providing the results they were seeking, their thirst for a Trump take-down blindsided many from seeing the bigger picture.  Once they awaken from their nightmare of Trump escaping any of the Mueller indictments, they will see he actually did them a huge favor by sending the investigations to other jurisdictions.

Once Trump and his team finish their victory lap and admonishing those who they have defined as their enemies, a gauntlet of criminal investigations await them:

  • The hush money investigation
  • Trump’s inauguration funding
  • Pro-Trump super PAC
  • Trump Organization insurance policies
  • Trump Organization real estate deals
  • The Trump Foundation
  • Trump’s taxes
  • Trump’s golf club employing undocumented immigrants

CONGRESSIONAL HEARINGS

  • House Intelligence Committee
  • House Judiciary Committee
  • House Oversight Committee
  • House Financial Services
  • House Ways and Means Committee
  • House Foreign Affairs Committee
  • Senate Intelligence

Trump nominates Stephen Moore to Fed Board.  Does this spell trouble for Jerome Powell?


ABOVE CAPTION.  President Trump Announces The Nominee For Federal Reserve Chair Of The Board Of Governors
Jerome Powell, governor of the U.S. Federal Reserve and President Donald Trump's nominee as chairman of the Federal Reserve, speaks as Trump, left, listens during a nomination announcement in the Rose Garden of the White House in Washington, D.C., U.S., on Thursday, Nov. 2, 2017. If approved by the Senate, the 64-year-old former Carlyle Group LP managing director and ex-Treasury undersecretary would succeed Fed Chair Janet Yellen. Photographer: Andrew Harrer/Bloomberg via Getty Images

“It is my pleasure to announce that @StephenMoore, a very respected Economist, will be nominated to serve on the Fed Board. I have known Steve for a long time – and have no doubt he will be an outstanding choice! @realDonaldTrump “

If your ambition is to serve as part of the Donald Trump administration, it helps to be part of the FOX network, speak negatively about the Obama administration or communicate in the media your disdain for someone in the current administration who happens to be in “hot water” with Donald Trump or his acolyte’s.  This morning it was Steven Moore’s turn to see if he can parlay his loyalty to Trump and go through the nomination process.

Stephen Moore, visiting fellow at the Heritage Foundation, listens during a Bloomberg Television interview in Washington, D.C., U.S., on Friday, March 22, 2019. President Donald Trump said he’s nominating Moore, a long-time supporter of the president, for a seat on the Federal Reserve Board. Photographer: Andrew Harrer/Bloomberg via Getty Images

Powell’s dilemma

The Federal Reserve is an independent body with the task of establishing monetary policy.  Currently there are two openings on the board.  Current Board Chair Jerome Powell has been in the crosshairs of Donald Trump for some time.  It doesn’t matter that Powell, a life-long Republican was recently nominated by Trump to his current post less than two years ago.  During that period the stock market hit some low marks.  Rather than blame himself for the policies he adopted which most economist indicated was the reason for the decline, Trump found a new foe in Powell and suffered the wrath and the blame.  Similar to so many officials Trump has appointed, many are independent and do not report or work for the White House.  Their role is to work on behalf of the citizens of the United States of America.   

Unfortunately as soon as whatever work they are doing intimates something Trump or the White House dislikes, they are admonished and chastised for not being a “team player.”

I only hire the best!

During the 2016 presidential campaign and leading up to naming key administration staff, Trump would boast, “he’d “surround myself only with the best and most serious people” — adding: “We want top-of-the-line professionals.”

That may result in a good sound-bite but the results to date have been a big flop.  More than a few people who had the aspiration to be part of team Trump has resigned, summarily shown the front door or indicted due to criminal behavior, while their dreams went up in flames.

Being a panderer has its benefits

In some circles, Moore has been viewed as the ultimate panderer known for making nervous smiles during his stint as a cable-news analyst.  He has demonstrated the willingness to support anything and everything spouted by Donald Trump.  His behavior has been very similar to those who are publicly interviewing for administration post’s knowing full-well of Trump’s appetite in spending as much time as possible consuming media.

The editorial

Up until this morning Moore was an analyst for CNN.

“Moore joined CNN as a contributor in early 2017. Given this news, he is no longer with the network, a CNN spokeswoman confirms.” CNN Chief Correspondent @brianstelter

He was known for his commitment to never admit anything negative about Donald Trump or his administration.  Despite tremendous documentation and evidence to the contrary, Moore’s would presents arguments that might result in an “F” grade in the most basic debate class.  His position was to always deny the obvious.

As mentioned, similar to other appointees Moore’s performance caught the attention of Trump.  But perhaps the thing that sealed his nomination was his March 13, 2019 editorial to the Wall Street Journal which blasted current chair Powell and blamed him for the concern about Wall Street.  This surely supported Trump’s attitude who in turn suggested to Economic Advisor, Larry Kudlow that Moore is just the type of person to fill one of the Fed vacancies.

Interestingly, many view the Federal Reserve as a prestigious organization where top economist who hold pHD’s wind up.  Moore’s resume does not compare to those who currently sit on the board.  Absent of a pHD, for the past three years his core employment was being a pundit for the Trump administration.

 

While Trump’s tweets are considered official communication, Moore indicated he has not received a firm offer.  Assuming it comes later today or within the next several days the next step is to go through the nomination process.  The big question is whether Trump is appointing Moore because he truly is competent and can improve the body or is he being positioned  to promote his views as articulated in his March 13th op-ed.

 

 

 

 

Trump Administration continues its attack on Cuba


 

Old American car drives near the Cuban telecommunications company ETECSA building in Havana, on February 28, 2019. – The European Union as well as Cuba faces a nervous wait as the countdown to US President Donald Trump’s March 17 deadline to activate sanctions against the Caribbean island nation approaches. Trump has broken with two decades of precedence in threatening to activate the Title III of the Helms-Burton Act, which extended the US embargo to apply to foreign companies trading with Cuba. (Photo by YAMIL LAGE / AFP) (Photo credit should read YAMIL LAGE/AFP/Getty Images)

On March 4th, Secretary of State, Mike Pompeo announced the United States has suspended Title III of the 1996 Cuban Liberty and Democratic Solidarity (LIBERTAD) against Cuba.

The move is another twist of the administration’s zeal to thwart any progress made by the Obama administration regarding rebuilding relations between the two countries.

Ironically, Title III had been waived by presidents since 1996 and had been renewed consistently until the announcement by Pompeo.  The act essentially allows Cubans who fled the country and landed in the United States following the 1959 revolution to sue in an attempt to reclaim land and property which was claimed by the government.  Whether they will be successful in court is undefined at this time.

 

While the move appears pretty straight-forward, many international experts have a different perspective.  Cuba is the largest country in the Caribbean and known for its independence and endurance.   In addition to being an ally to communist regimes, they have been a big supporter of Venezuela and their support of the Maduro government.

The 1959 Revolution resulted in those not supporting the new regime to flee leaving  property and other assets which the government used to rebuild the country.  No doubt the issue is controversial and bitter feelings still exist from those who were exiled.  However, some view the Trump Administration’s action as basic retaliation for the country supporting someone in another country who they do not support.  As mentioned Pompeo indicated the move will be revisited in 30 days.

Like many things with this administration, it is unclear how many lawsuits may be brought or their probability of success.