M&T Bank agrees $64 million mortgage probe settlement
M&T Bank Corporation has agreed a deal with the US Department of Justice over alleged breaches of the False Claims Act between 2006 and 2011.
The DoJ claimed that the lender had violated the rules by knowingly underwriting loans which did not meet the criteria for insurance by the FHA
M&T has agreed to pay $64 million in settlement, the DoJ said Friday. The department also highlighted that it will continue to pursue lenders that submit loans to the FHA which do not meet HUD requirements.
First-timers’ budgets continue to expand
First-time homebuyers are expanding their budgets amid growing prices according to a report from BMO Harris. The average new buyer is setting aside $246,378, up from $193,197 in 2014. Despite needing a larger mortgage, first-timers are planning a 10 per cent downpayment compared to the 16.4 per cent average for 2014.
The report also shows that 80 per cent of respondents aim to be pre-approved for a mortgage before seriously shopping and the same percentage is confident of having their downpayment in place when needed.
"It's encouraging to see that first-time home buyers' budgets have increased and the intent to purchase has remained strong," said Kevin Christopher, Head of Mortgage Sales, BMO Harris Bank.
First-time buyers are well-aware of the risk of higher interest rates with 83 per cent of respondents planning to stress test their mortgages to take into account higher rates in the future.
Millennials’ finances have changed America’s housing market
Millennials are less well-off than previous generations and it’s having a real impact on the real estate market. A panel of experts at the Realtors Legislative Meetings and Trade Expo spoke in a session moderated by the chief economist of the National Association of Realtors, Lawrence Yun.
"America in the near future will look nothing like the America of the past," said Paul Taylor, executive vice president of the Pew Research Center and author of the book "The Next America: Boomers, Millennials, and the Looming Generational Showdown". "These shifts are creating big generation gaps that will put stress on our families, our politics, our pocketbooks, our entitlements programs and perhaps our social cohesion."
With uncertainty of the economy, flat wages, rising home prices and other factors, millennials are making the big life decisions later and 39 per cent still live with their parents.
NAR survey research chief Jessica Lautz said that despite the challenges for young Americans, their keenness to own a home is still strong, and the median age of first-time buyers is 31, largely unchanged from previous years.
"This means that they are ready and willing to buy if they can in fact break into the market. It's getting more difficult to get to that point, but the desire to do so hasn't changed," Lautz said.
She also noted that millennials are using real estate agents at higher rates, despite the increase in new solutions in the digital age.