Morning Briefing: Mortgage lender upsets Twitter following Super Bowl ad

by Steve Randall08 Feb 2016
Mortgage lender upsets Twitter following Super Bowl ad
Super Bowl viewers took to Twitter in protest at mortgage lender Quicken Loans following a commercial for its Rocket Mortgage product. CNN reports that many people felt that the 60-second commercial was promoting irresponsible behavior among borrowers with comments such as: “Rocket Mortgage: explaining the 2008 financial crisis in one commercial.”

The backlash prompted the Consumer Financial Protection Bureau to tweet: Lots of financial #ads during the #Superbowl this year. Don’t worry, we still have #adfree resources available. Quicken’s president Jay Farner told CNN that the purpose of the ad was to promote the convenience of the firm’s app and that he agreed with the advice from the CFPB: "I think that everyone is realizing it's time for the housing industry to advance, in our mind that is about transparency.”

Here’s why millennials may not want to buy a home
Millennials may not be keen to settle down and buy a home even if they know they would save money compared to renting. According to Zillow the average millennial worker stays in the same job for an average of three years but in some housing markets it takes three years to break even on a home purchase; the national average is 1.9 years.  Although over 36 months they are likely to save thousands of dollars by paying for a mortgage rather than rent, many millennials value the freedom of renting.

"Even with record-high rents in job centers like San Jose, Boston and Washington, D.C., putting off a home purchase might be the best financial decision for a young person who has saved enough for a down payment, depending on how long they intend to stay in their jobs and homes," said Zillow Chief Economist Svenja Gudell. "Young workers face a lot of hurdles on the way to homeownership, including saving for a down payment in the first place and deciding where and when to settle down.

Zillow figures show that there is wide disparity across the nation when it comes to breaking even on a home purchase. For example, Dallas, Indianapolis, Detroit, Atlanta, Kansas City and Cleveland are among the areas where a buyer will, on average, breakeven within 18 months. However, those in Los Angeles and Washington will wait more than 4 years to breakeven.
New Arizona brokerage combines some top producers
Some of the top real estate producers in Arizona have joined together to form a new brokerage called Launch. Focusing on luxury real estate, Launch was created by local real estate entrepreneur John N. Vatistas and combines hand-selected top producers from Russ Lyon Sotheby’s International Realty, Berskhire Hathaway Home Services Arizona, Realty Executives, and Engel & Volkers.

“The buyer/seller/agent relationship is highly individual and personal. Launch celebrates that partnership and makes it centric to every part of the transaction,” Vatistas said. “Pulling this talent under one roof enables Launch to give its clients access to a broad network of industry expertise unrivaled in the marketplace and free of corporate bureaucracy.”

Launch is expected to have 50 invited agents as part of its team within 30 days and Vatistas says it will shake-up the standard brokerage model.
Mortgage credit availability dropped in January
The availability of mortgage credit was lower in January according to the Mortgage Bankers’ Association. Its index, which uses Ellie Mae data, decreased by 0.4 per cent to 123.8, indicating a slight tightening of lending standards. Conforming loans saw the largest decrease on the index at 1.5 per cent. Jumbo was the only one of the four component indexes to increase, by 0.2 per cent, indicating loosening lending standards.


Should CFPB have more supervision over credit agencies?