Today I’ve been thinking about who the winners and losers of the government bailout of Fannie Mae (FNM) and Freddie Mac (FRE) will be. It will take some time to sort the impact of unprecedented government intervention on the financial markets. However, the market is already betting on how this “black swan” event will play out. For first time buyers, knowing which types of loans are ideal for your personal situation can seem overwhelming. Differences in interest rates or seemingly insignificant terms can leave a home-buyer more savings in the long run. Instead of flailing in the wind, let an experienced lender help you with an Overland Park mortgage. We can help navigate you through each financing option that’s available. That way, we can make sure you get the best product for your specific situation. Metropolitan Mortgage, we are Kansas brokers that make the entire process a breeze. Helping potential buyers obtain the best loan terms on a fixed or adjustable rate. In addition, we will guide buyers through the new real estate purchase or refinancing process. We prioritize the perfect home loans at the lowest rates and closing costs, based on credit scores. You can click URL for Overland Park, KS Mortgage Lender. We all know that there are only two guarantees in life: death and taxes. Seeing as none of us are going to get out of here alive, it seems appropriate to discuss what happens when the last surviving spouse passes away when a reverse mortgage is secured by the property. This is a question that comes up with nearly every client of ours when discussing the option of a Grants Pass reverse mortgage. And there’s good reason for it. This loan is designed exclusively for older adults aged 62 or older. Seniors want to protect their estate and make sure that they are not making a decision that will harm their legacy when bequeathed to their heirs. So, what happens when the last surviving spouse passes away? The lender is generally notified of a borrowers passing by the family, heirs / estate, by “death audit” service, which compares the lender’s database against other databases including the social security death index, or other methods available. Once the lender has confirmed the death of the last surviving spouse, a letter is sent to all known heirs. The letter acts as a repayment notice that informs the estate / heirs that the mortgage is due and payable as well as all of the options available for satisfying the loan obligation.
Placing the two mortgage giants into “conservatorship” to ensure that each company maintains a positive net worth will boost investor confidence with GSE debt and mortgage backed securities. However, the Fannie Mae and Freddie Mac common stock and preferred shareholders are clearly the losers. Beyond these direct impacts, within minutes of the opening bell, the market was already voting on the perceived winners and losers of this major government takeover. Using the highest volume percent gainers and decliners in the stock market give us some insight into what the market is predicting.
Highest Volume Price Decliners
|Lehman Brothers (LEH)||14.15||111,389,898||-2.05||-12.65%|
|UAL Corp (UAUA)||10.92||54,654,898||-1.38||-11.22%|
|Continental Airlines (CAL)||17.10||26,362,100||-0.96||-5.32%|
|Fannie Mae Preferred S (FNM-S)||3.42||26,041,102||-0.96||-5.32%|
|Sovereign Bancorp (SOV)||9.02||24,732,699||-0.64||-6.63%|
|ON Semiconductor Corp (ONNN)||7.75||21,748,102||-0.51||-6.17%|
|Yamana Gold Inc. (AUY)||8.49||18,951,801||-0.73||-7.92%|
|Freddie Mac Preferred Z (FRE-Z)||2.87||18,535,900||-10.69||-78.83%|
|Potash Corp Saskatchewan (POT)||153.33||17,179,600||-8.72||-5.38%|
|RF Micro Devices (RFMD)||3.22||17,086,900||-0.38||-10.56%|
|Arch Coal (ACI)||37.75||15,636,800||-5.54||-12.80%|
|Barrick Gold (ABX)||29.41||12,703,200||-1.53||-4.95%|
|Peabody Energy Corp (BTU)||49.92||11,935,500||-3.38||-6.34%|
A quick review of the above list shows that GSE preferred shares and holders of GSE preferred shares (Sovereign Bancorp and potentially Lehman Brothers) will likely be losers of the bail bondsman. After you have been arrested and your bail conditions set, chances are that you may be unable to afford the amount that has been set and this calls for fast thinking as your freedom, and how fast you will get out of jail depends on it. 24 Hour Bail Bonds Financing agents may be able to offer you bail bond loans to cater to the financial distress that may have been caused by the amount demanded. 24Hour Bail Bonds Financing is the leading provider of flexible and affordable bail bond loans and bail bond financing across multiple locations in Connecticut. You can read more here about the 24 hour bail bondsman in new haven. As a bail bond financing company, we understand the importance of freedom and this is why we have set up shops in multiple locations throughout the United States with a mission to help people with affordable payment plans and bail bond financing. Our very professional bail bondsmen are knowledgeable, trustworthy, and will address you in the local language for ease of communication. We will also ensure that all of the bail bond loans and financing packages offered are those that have been designed to reflect your current financial standing thus giving you the flexibility needed to make other financial decisions.UAL looks like it was the victim of old news unrelated to the bailout, but the reaction to the old 2002 misdated bankruptcy goes to show you how jumpy this market is. Interestingly, there are quite a few gold names on the list above, I guess in reaction to the changing macroeconomic landscape. The decline of Potash Corp of Saskatchewan might indicate that the market expects a decline in the energy driven agricultural sector. It also looks like coal might also take a hit as indicated by the high volume declines in shares of Arch Coal and Peabody Energy Corp.
Highest Volume Price Advancers
|Citigroup Inc. (C)||20.32||170,433,906||+1.25||+6.55%|
|Bank of America (BAC)||34.73||164,211,391||+2.50||+7.76%|
|Wells Fargo & Co (WFC)||33.56||133,161,500||+2.36||+7.56%|
|Regions Financial Corp (RF)||12.24||40,576,000||+1.15||+10.37%|
|National City (NCC)||5.15||32,896,902||+0.33||+6.85%|
|Annaly Capital Management (NLY)||16.88||30,483,199||+1.56||+10.18%|
|Pulte Homes (PHM)||16.22||25,298,900||+1.64||+11.25%|
|Bank of New York Mellon (BK)||39.78||24,594,000||+3.44||+9.47%|
|Capital One Financial (COF)||48.73||21,247,400||+4.02||+8.99%|
|D R Horton (DHI)||14.11||20,345,799||+1.53||+12.16%|
|Suntrust Banks (STI)||50.93||16,366,800||+5.51||+12.13%|
|Zions Bancorp (ZION)||36.66||16,155,500||+3.69||+11.19%|
|CIT Group Inc (CIT)||11.53||15,412,601||+0.80||+7.46%|
|KB Home (KBH)||23.54||13,834,900||+2.93||+14.22%|
|Toll Brothers Inc (TOL)||26.47||13,723,300||+2.27||+9.38%|
The winners clearly appear to be the national and regional banks along with home builders. There are also several mortgage and credit providers on the list. I’m personally not quite convinced that home builders are in the clear yet. While the governments actions may have potentially helped lower the cost of mortgages, I still think there is too much home inventory out there. It will be tough for earnings to recover in this sector.
It is very unlikely that I will act solely on any of the information above. However, I believe looking at some of these big market days that have significant financial events helps me better understand some of the larger scale sector sifts that may be occurring. I can then try to understand some of these larger trends and focus my research on sectors that might yield potential value opportunities. It is also handy to preserve this market information for future reference. What is your take on yesterday’s market reaction to the Fannie Mae and Freddie Mac government takeovers?