Mortgage Originations Plunge To Lowest On Record

Tyler Durden's picture

New mortgage originations fell over 23% month-over-month and a stunning 47% year-to-date according to Black Knight (formerly LPS). As they show in their detailed presentation, with a 65% year-over-year drop, new mortgage originations are at their lowest since their records began and what is perhaps more concerning is prepayment speeds signal further declines are ahead and the ratio of serious deterioration to foreclosure (along with huge numbers of loan mods due to reset) suggest the housing market is anything but recovering fundamentally with the average loan in foreclosure now 2.6 years past due.



But apart from that - prices are up so that must be good right? as affordability for the average joe collapses.

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JJSF's picture

European housing market doing fine. But getting them to take loans has been difficult

Sudden Debt's picture

well the 30 years loans are gone and young people now need to deposit 75K before they can get a loan.

So now it's up to mommy and daddy to pay up for babygirl and boy.

y3maxx's picture

...Soon all of this USSA map will be awashed in "Red" pun intended.

Sudden Debt's picture

I see... a tungsten hammer in washington.... and I'm pretty certain there's a cicle forming also...

Vampyroteuthis infernalis's picture

People argue with me why am I a renter. I tell them the housing market is a seller's market that is way overpriced. It is best to wait about 3-4 years. When they are financially ruined, I will be living in their former house. Bitchez!!

NoDebt's picture

You may end up being right about that.

The biggest "trend" I see, is that it's not just "location, location, location".  It's now mansions vs. regular guy houses.  The high end is still cranking (it's just another investable asset in a world awash in printed money).  The low end, however, is flat on it's back and declining.  First time buyers are sparse.  Investors buying to rent don't pay full retail for those places, which also keeps the prices depressed.


Keyser's picture

You are correct. I made an offer on a upper-end home with some acerage over the weekend. Someone came in right after me and bumped the offer $20K over the seller's asking price. I won't get in a bidding war, so it's on to the next listing... Problem is that in my area the upper-end properties don't last 24 hours on MLS... 

MachoMan's picture

The opposite here.  Anything over $225k (5x+ avg fam income) sits unless it's perfect.  The mcmansions are starting to rot, country clubs opening up membership to the public, etc.

The low end is mercilessly bid (with middle of the road homes selling at a premium to 7 years ago)...  I presume stuffing hud tenants into it and making ~17%+ returns.  We're getting an incredible influx of indigents, as there are more people coming here than jobs.  Our infrastructure will be overrun within a decade at this pace, but it's still dramatically better for many folks than their present towns...  and anyone with any sense will have moved to the next town over before it goes down.


eatthebanksters's picture

I would really like to see some numbers...numbers of available borrowers during the liar loan phase and right now. I'd like to see the average loan amount for which these borrowers qualified then and now.  I'd like to see the difference total home values from 1996 to 2006 and same for total loans for then and for now.  I'd like to see a model that shows the impact of home prices based upon demand as a result of number of total borrowers, loose underwriting and qualifying conditions, interest rates and increasing home prices (past) and then the same model with tight underwriting critera and stable and/or deteriorating home prices.

Two things are missing from this equation today:  e-z loans (reducing the number of buyers dramatically), 2. Continued home price increases.  (Did I need to mention jobs ad income?)

I believe the Fed tried to resucitate a market that was dead and should have been buried.  I believe the amount of extra debt burden that was added to society was never going to be overcome.  The Fed tried to manipulate the situation but its catching up wth us.  It would have cost $4 to $5 trillion to write down the bad debt in 2008.  How many trillions have we thrown at the problem to fix it and its about to get bad again?

Something tells me that we are more underwater today relative to current market values vs. fundamental real values (in the stock market as well) and that our government is playing a very dangerous game and it is losing.

All that TPTB have done is kicked the can down the road....the great reset is coming and in the paraphrased words of Kyle Bass,"If we have a voluntary restructuring it will be painful, if we have an involuntary restructuring it will be VERY painful."

Any banker or politician that was complicit or lied about this ordeal from the beginning ought to be tarred and feathered, have all their assets taken away and they ought to be cast out in shame.  We have not seen the end of this mess and we won't until a real balance is found...and that means writing down trilllions of debt that was provided to suckers from vampire squid predators. If we'd have done it 6 years ago we'd be healing, but instead we are reopening a nasty wound.

KidHorn's picture

The reason nothing gets fixed is we've hit a critical number of people who have nothing to lose. If you have nothing and someone is willing to loan you money and you have no collateral, you take it. What do you have to lose? The politicians are buying your vote with promises that this will continue and it will continue as long as the gov't is the one making all the risky loans. You would think responsible people wouldn't allow it. They're now outnumbered and hence don't have a say any more.

You can move to another country, but they're all doing the same thing. At some point workers will get fed up and stop working. They'll see themselves as suckers for going to work. Who knows when that will happen.

Squid-puppets a-go-go's picture

at this stage in the cycle, if you got $50 or $75k for your deposit, you'd be an idiot to buy.

put that cash into physical gold + silver outside the matrix, wait 3-5 years, and you'll be able to buy your house outright.

Keyser's picture

I should have mentioned that I live in Texas to put things into perspective... The influx of people moving to Texas has placed a premium on properties. Especially folks that move here from California after selling their McMansion there... From the proceeds they can afford a new McMansion in Texas, plus all new furniture, 2 new cars and have some $$$ left over... I have run into more than one family with this exact story... This caused by the differential in property prices between Ca and Tx... A $1 million property in Ca can be a crackerbox, while in Texas it buys you one helluva house...

IREN Colorado's picture

We're seeing real increases in offers on the order of 5% per month right now in Colorado. A year ago the market was flat. What's changed?

Obamacare has been delayed. Okay; Real employment participation has never been lower, sure, but, International investors are landing with suitcases full of bearer bonds at DIA every single day (to invest in anything other than their home lands where the economies are even more sketchy than ours), so that represents an increase in demand; Western US oil interests and their employees are realizing solid income gains right here in the Rocky Mountain West, right, where there is fracking there is economic growth, no mystery there; Lots of area Vets coming home with VA benefits, more debt? roger that!........ 

Yes, in some markets the price increases might be justified, no, make that explainable, at least for a while. Is this healthy long term????????????????

I kinda think not............

  • Obamacare will be implemented and thus form a massive drag on the economy, sooner than later.
  • International investors will eventually dry up. When they get a sniff of a pull back in the Colorado RE market they'll run for another shelter. Whatever that is and where-ever that is.
  • The oil "bid'ness" is being crushed by the Feds through taxes and regulation and global warming BS. Also, oil demand drops in recessions/depressions. That income will dry up leaving US in the next Colorado bust.
  • Vets using their VA benefits to buy homes will loose them as soon as they are downsized out of the military as part of the upcoming rounds of cuts. Where else are they going to work in this economy? Their grandparents are working at Wally's world and McDonalds!

Asset Bubble much?

studfinder's picture


I know of a builder of high end homes.  Recently I was told the he is working on 5 right now and 2 of them are above 2 million.  I guess business is very good right now.

Professor Fate's picture

I'm with you Vamp.  Even though I'm a Vet and can get no money down financing, I still rent.  Prices are up 40% in my area of Florida and everyone can't understand why I don't buy.  I do buy...Morgan silver dollars every month.

Fate the Magnificent
"Push the Button, Max"

slightlyskeptical's picture

Why didn't you buy 3 years ago?

You could now have many more of those Morgan dollars.

Buying is actually cheaper than renting, especially over the long term, even at these ridiculous prices.

jbvtme's picture

i rent a house which would cost me twice to own (with taxes and maintenance). housing prices will be cut by at least half within five years.

Blankenstein's picture


"Buying is actually cheaper than renting, especially over the long term, even at these ridiculous prices"


False - this is a bunch of realwhore blather 

syntaxterror's picture

B-b-b-b-b-ut I got to write-off the $40,000 in interest I paid this year.

Iam_Silverman's picture

"this is a bunch of realwhore blather"

True, because in ten years or so when you decide to move, you'll get much, much more money back when you sell.

Oh, wait - did I get that wrong?  You mean that you cannot even hope to break even when you are tossed out at the whim of a landlord?

Squid-puppets a-go-go's picture

my father lives in a small town in new south wales that is about 150 years old that was bypassed by changes in industry or transport and other main sources of prosperity. Barely a new house has been built there in the last 30 years, no one spends on maintenance. You can buy a 3 bedroom house there for $100k. With builders wages and materials/taxes today, you couldnt build a house that meets regulation for less than $250k

If you think that the price will be higher by magnitudes in 10 years, you dont realise that the entirity of America is akin to that small town. We are 7 years into the downturn in places like Spain and the price of real estate there is STILL dropping and expected to go down another 10-20%

the US Govt missed its opportunity in 2008 to get back to honest markets, and so shall it share Spain's fate


goBackToSleep's picture

Looks like the drug cartels are holdin down the western border of mexico. Miami must be totally out of the import business.

derek_vineyard's picture

red states and green states---lets split this country in two using that criteria

KidHorn's picture

Better yet, let Florida and New York cede and form their own countries. That looks like it would eliminate 75% of the problem.

ParkAveFlasher's picture

I should hope that this time around the Confederacy makes to point to invade, not simply to secede.

OH10DESERTER's picture

when Mommy and Daddy have sucked up all the wealth through medicare, SS, and Pensions...there be no funds left for da chitlins to earn


OldPhart's picture


I love fucking up a bank's plans.  My thirty year is at a twenty five year now...a little at a time suddenly makes a hell of a difference.

Parabox's picture

turned my 30 year into a 5 year.  Now I only pay rent to the government.

Sudden Debt's picture



Sudden Debt's picture

I don't know... using dollar bills to build a house... sounds expensive...

Emergency Ward's picture

Those wouldn't last long in Venezuela.

Hubbs's picture

We should ask the three little pigs: Straw, wood, or brick.... and see if the wolf concurs.

Obama_4_Dictator's picture

Burn bitch...burn....can't say I feel sorry for these loser real estate fucks.  Eat shit fags!

Headbanger's picture

Now don't be holding back on us here..

Obama_4_Dictator's picture

Well, it's unfair (yes, I know the world is unfair), all I'm asking for is the same pain and punishment for everyone.  Real Estate losers do nothing but lie, I think there is special place in hell for them, then if you are unwater you get to live for free! But if you have an ounce of equity, boom, you're gone!  Bullshit! No more rewarding the losres and punishing the smart folks. And Justice For All!

Oldwood's picture

But there has never been a better time to buy!

ChargingHandle's picture

What trade is a fair way of life based on your analysis? 

syntaxterror's picture

A fair trade? 

It probably won't involve YellenCoin.

onewayticket2's picture

the bluer the state, the redder the chart....

TruthInSunshine's picture

All of Florida is lit up like a Roman Candle.

New Tel Aviv...I mean New York has a tremendous number of schnorrers.

asscannon101's picture

Guy I work with lived in his house and didn't make a mortgage payment for 4 years.

FreeNewEnergy's picture

I live in NY, inherited dad's home when he died in July 2009. Coming up on 5 years. In FC over 4 now. Crickets all I get from BofA.

Here is what I did:

Year 1: Played a lot of golf, drank heavily, kept house up minimum of repairs, bought some silver.

Year 2: Drank a little less, started thinking about possible windfall, did lots of research (lots of help from ZH Thanks!), figured I was in a good spot. Blew a lot of money on a broad in the country, bought more silver.

Year 3: Steady drinking, started actually paying down debt, looking at other RE options, couldn't believe I was still living rent and tax free (bank pays prop taxes), started paying down my own debt (CCs and HE on my original home that I began renting in year 2), moar silver.

Year 4: Really picked up the pace on paying down debt (all CCs closed out, zero balances, HE cut in half), sued bank for fraud, have their nuts in a vice and am seriously looking at getting the house F&C within 2 years (SOL runs out on the bank). Still drinking a good amount for mind balance.

Long story, short, if I had known I'd be here five years, I'd have begun saving and paring debt faster, and played less golf. Would not have been searching for alternatives, rather, putting the house to work (maybe do more repairs and rent out a room). I'd probably still be drinking, because I like it, but my finances would be much better. As it is, no CC debt (wiped out about 5K), and cut a hole in my HELOC while continuing to collect rent on my former home. I'm far ahead, but the holy grail is getting the FC action dismissed for failure to proceed and citing case law that their action did not stop the SOL clock. Either that or forcing them forward on my fraud case and negotiating a settlement at 1/3 the original amount.

The only questions now are: 1. How much will I pay for the house, if anything? 2. How much more pain can I inflict upon the bank?

As we used to say, I fell into some good shit. I'm above average on length of time in FC, even in NY state, and propects for whipping BofA are excellent, all without a lawyer (other scumsuckers).

dontgoforit's picture

If what you say is true, you're a piker and are at least part of the reason things are in the shape they're in.  You are then as 'bad' as the ones you are cursing.  I'm sure your deceased dad is proud...

Clycntct's picture

You forgot to add. Don't forget to go to church on Sunday and pray for the BankWankers.

Offthebeach's picture

At least he's maintaining the house. All I do is fix up fc flip houses. Typical shlock fake bling mcmansions. Poorly built and poorly painted when new. Never maintained by first and nothing done by the bank. No heat for years. Burst pipes from scam winterizing plumbers. Black mold. Mercenarially we do minimum slop repairs for quick buck flip speculators.

Kind of sad. When I was a kid a finished house was an accomplishment. Lots of old trade artists. Now? Might as well be doing meth, third shift Jack'n Box.

Peter Pan's picture

So are we getting more QE or is the FED going to wake up to the fact that QE is not a perpetual motion machine but a steroid with lethal consequences?