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Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

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Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#281

Post by doctoboggan »

mbesto wrote: post #191
doctoboggan wrote: post #170

My wife and I will be moving to Chicago soon and we intend on buying a house when we get there. How screwed are we by the current housing situation and interest rates?

I grew up in Chicago and love Chicago, so I'll try to say this as politely as possible - don't expect your property to hold any value in IL. Anecdata - I have friends that lived there for 8+ years, then moved to the south in the last 2 years and their property value barely budged.

I honestly won’t be too upset if that happens especially if it means people aren’t treating housing as high return investment vehicles. Hopefully that means house prices will be more reasonable.

Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#282

Post by oliwarner »

refurb wrote: post #79
oliwarner wrote: post #55

Earlier quoted context omitted.

Whole-term-fixed rates are pretty uncommon in Europe. Fixes of 2, 5 sometimes 10 years are products most providers offer, but as the term increases, the rate shoots up, to offset rate uncertainty. My question is: why would you fix for 30yr when you know you're paying multiple points to offset market uncertainty? Remortgaging every couple of years takes a bit of time, and shopping around, but is much cheaper.

The 30-year fixed mortgage (the entire amortization period is at one fixed interest rate) is a government created product. It would never be offered by banks, at the low rates they are, if they had to hold them on their books. The "normal" mortgages in the US prior to the FHA were 50% down and 5-year terms. https://bebusinessed.com/history/history-of-mortgages/ Fannie and Freddie basically agree to "back" those new m…

> at the low rates they are

Low rates?! BOA is offering me 4.9% on 400k/800k, fixed for 30yr. But they still want 4% for a 5year ARM. Even after income tax deductions, how the hell do Americans afford houses with this sort of nonsense.

I guess that's what TFA is really driving at. It's getting hard to lend money on housing in the US.

Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#283

Post by JetAlone »

ilikehurdles wrote: post #216
JetAlone wrote: post #101

Earlier quoted context omitted.

There are 3 good replies to this one giving a decent analysis for why I might want to reconsider my position. It's hard to pick which one to answer to. Would you say that mortgage is probably driven down 8% because just can't afford the down payment anymore, or people like me who seem to have an irrational aversion to it?

Is 8% referring to Rocket Mortgage layoffs? Over the last two or so years, mortgage rates hit historic lows, which meant the demand for cheap mortgages increased significantly, both from people wanting to enter the market and those refinancing. Consider that the $500k mortgage that would have cost $2300/mo in 2019 suddenly costs like $1600/mo in 2021. Absolutely I jumped on that train, as many others did. Lenders wer…

It wasn't the right time to buy for me, for a handful of reasons, got no resentfulness over it. I don't know what my local market is like, or is going to be like.

Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#284

Post by simulate-me »

tristor wrote: post #269
simulate-me wrote: post #239

Earlier quoted context omitted.

The IRS does not consider a refinance (even a cash-out refinance) to be a capital gain. The IRS also allows for 250K (500K if married) of tax-free capital gains on the sale of a primary residence. Maybe you misunderstood your friends’ situations.

This is only true for a primary residence located in the US. If it’s a foreign asset, it’s taxed normally. The IRS deeply screws expats.

I just looked this up and you're right. If you're subject to the expatriate tax then you're automatically disqualified from the exemption. From my reading, it seems like there is a small loophole. You can sell a foreign property if you move back to the U.S. and meet all the other primary residence conditions.

Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#285

Post by doctoboggan »

onlyrealcuzzo wrote: post #173
doctoboggan wrote: post #170

My wife and I will be moving to Chicago soon and we intend on buying a house when we get there. How screwed are we by the current housing situation and interest rates?

How soon? If trends continue, prices will start falling. You might be able to offer under asking, too. I bought 15% under asking in October of last year. Chicago didn't really go crazy like Phoenix or Palm Springs...

Hoping to buy in the next few months.

Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#286

Post by gbasin »

agent008t wrote: post #273
gbasin wrote: post #227

Earlier quoted context omitted.

Housing [land] prices have been grinding higher long before the Great Decline in interest rates https://fred.stlouisfed.org/graph/?g=kYEb

That chart seems to only go back to 1987, which is after the decline in interest rates started: https://fred.stlouisfed.org/series/REAINTRATREARAT10Y

Here you go https://observationsandnotes.blogspot.com/2011/07/housing-pr...

Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#287

Post by nsteel »

tristor wrote: post #269
simulate-me wrote: post #239

Earlier quoted context omitted.

The IRS does not consider a refinance (even a cash-out refinance) to be a capital gain. The IRS also allows for 250K (500K if married) of tax-free capital gains on the sale of a primary residence. Maybe you misunderstood your friends’ situations.

This is only true for a primary residence located in the US. If it’s a foreign asset, it’s taxed normally. The IRS deeply screws expats.

Exactly. And what's even more brilliant is that it entirely depends on the exchange rates at the start and end of the period. So a zero gain (or even a loss) over that period in the UK can still result in US tax owed.

Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#288

Post by eli_gottlieb »

xadhominemx wrote: post #207
hans1729 wrote: post #19

Earlier quoted context omitted.

I mean, it's not really a burst, we're just hearing the hissing noise of the obvious leak. The true demand from people with the intend to actually live in the estates has been constantly decreasing since around 2000; the real salarys dropped since then, so did the buying power. The only reasons people found buyers at x3-x10 (!) prices were a) that there is a class of people wealthy enough to still afford the purchase…

> The true demand from people with the intend to actually live in the estates has been constantly decreasing since around 2000; the real salarys dropped since then, so did the buying power. > When 90 (?) percent of people simply lack the buying power to participate in the real estate market, but the other 10% happily sell each other estates, that's not a bubble, the real estate market just stopped interfacing with th…

>Nonsense. The home ownership rate is 65%, in-line with the long term average and the same as it was in the year 2000

The homeownership rate is counted in terms of households, no? So it can be kept artificially high just by having 20-somethings no longer move out of their parents' houses.

Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#289

Post by mywittyname »

ssharp wrote: post #160
streblo wrote: post #134

Earlier quoted context omitted.

Most people don't do the math and realize that over a long enough time horizon a 30 year fixed mortgage will cost you less than purchasing the home outright. This assumes you take the money you would have sunk into the home and instead invest it at a higher rate of return, which is an option available to most home owners.

Well most people aren't going to take the money and invest it at a higher rate of return, either. With 30-year rates around 6% right now, the math becomes a lot tighter as well. Where are you going to find 6%+ investments right now?

People who accumulate so much wealth that they are able to purchase a home in cash are very likely to be doing some kind of investing. Be that traditional investing, running a business, or finding careers in sectors which require lots of time & education. It's just not feasible for people to accumulate large amounts of cash otherwise; the people who do are lottery winners or people with large inheritances.

So the invest/pay off home trade-off is there for everyone. Even for people like doctors, whose investments might not necessary be market-based.

Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#290

Post by pdovy »

redshirtrob wrote: post #237

Has anyone actually used Rocket? Every time I (or a friend) have looked at them they have higher closing costs and wanted multiple points to close the mortgage. I was able to do way, way better by going with a local bank, as did my friends. The only thing I can figure is they are better for folks with "good" (not "excellent") credit and can maybe close the loan faster.

I used them, but only because they have a relationship with my brokerage that allowed me to get preferential terms.

If not for that I'd have preferred someone local, you could tell you were just a number over there, and there were a bunch of communication issues around scheduling the appraisal that were annoying to sort out.

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