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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Jim McMannis who wrote (45574)	12/9/2005 3:37:16 PM
From: CalculatedRisk	Respond to of 306849

Mortgage Industry Job Losses May Rise With Interest Rates With refinancings declining, layoffs at Ameriquest could be followed by tens of thousands at other companies, experts say. latimes.com Excerpt: As interest rates have risen, refinancings have faded and applications for loans to purchase homes have begun to decline, according to the Mortgage Bankers Assn. Many borrowers already have taken out equity from their homes through refinancings and second mortgages. If home prices level off, as many predict, these homeowners will have less equity to extract and less incentive to refinance. Mortgage Bankers Assn. economist Doug Duncan said jobs would be lost as some companies pared their staffs and others were acquired or went out of business. The number of job reductions will depend on how high rates go, he said, with as many as 80,000 positions eliminated should 30-year fixed rates climb to 8.25%, up from 6.32% currently. In addition to layoffs, experts also expect a shakeout in the ranks of mortgage brokers, the independent loan originators whose numbers have swollen along with the home-lending boom that began in 2001. These brokers aren't counted in the payroll surveys conducted by the government. John Marcell, president of the California Assn. of Mortgage Brokers, believes that they now total about 25,000 in the state, but predicts that's about to change radically as ill-trained brokers who got into the business during the boom now find it harder to make a living. "I would say probably half of what's out there today could wash out," Marcell said.