Mortgage, loan and property. What is a mortgage?

A mortgage is putting a property as a guarantee to a lender as a security for a mortgage loan.

While a mortgage in itself is not a liability or a dept, it is evidence of a debt. It is a transfer of an interest in property, from the owner to the mortgage lender, on the condition that this interest will be returned to the owner of the property when the terms of the mortgage have been satisfied or concluded.

In other words, the mortgage is a guarantee for the loan that the lender makes to the borrower. In all but a very few states, a mortgage creates a lien on the title to the mortgaged property.

Friday, December 5, 2008

1 in 10 real estate borrowers threatened in the U.S.?

One in ten real estate borrowers is potentially threatened with expulsion from his home in the United States, said Friday the Mortgage Bankers Association MBA.

The rate of outstanding mortgages in the United States jumped to 6.99% in the third quarter, after 6.41% in the second, the MBA said.

But the proportion of owners in difficulty in near 10% when adding those who are already the subject of a foreclosure: they were 2.99% during the quarter, against 2, 75% in the previous.

Among subprime households, considered from the outset as having a greater risk of default, the rate of unpaid reached 21.3% (against 21.0% in the quarter), if the loan is variable rate; it is still at 18% (against 16%) for fixed rate.

The rise of unpaid is also found among the most creditworthy households: the rate of arrears among those who chose a variable rate reached 8.2% (against 7.5% in the previous quarter), while it was 3.3% (against 3.1%) for those with a fixed interest rate.

Wednesday, December 3, 2008

Tough November for the private sector in the U.S.

The deterioration of the market continues to accelerate in the U.S., where the private sector has lost (destroyed!!) 250 000 jobs in November, according to a study made by the human resources firm ADP, released Wednesday.

The decline was much greater than analysts predicted, which was 200 000 job cuts.

ADP nevertheless says that his study does not take into account the impact of the return to work of 27 000 workers mechanics of the aircraft manufacturer Boeing, after an agreement ended their strike at the end of October.

The November survey "provides proof that the weakening labor market continues," says ADP.

The firm has revised its estimate of the number of destroyed jobs in the private sector in October to 179 000 (instead of the originally announced 157 000).

Tuesday, December 2, 2008

U.S. construction is spending less than expected

Construction costs in the United States fell by 1.2% in October compared to the previous month, extending the black series of economic statistics this month, according to figures released Monday by the Department of Commerce.

The decline in seasonally adjusted data, is more marked than expected by analysts, who relied on a decrease of 0.9%. But it is two times less than it was in July (-2.4%).

The evolution of spending in September was revised to stable from the previous month, instead of declining 0.3% like previously announced (good news!).

On a year, construction spending in October showed a contraction of 4.6%.

Private construction costs (71% of the total) are down 2% from the previous month and 8.8% in one year.

The residential construction costs (32% of the total and 45% of private construction), which fell by 3.5% over the month and 23.6% in one year, continue to weigh on the overall trend.

Expenditures for non-residential construction (hotels, commercial or industrial buildings, offices ...) are however virtually stable over one month (-0.1%) and up 8.3% year on year.

Among the non-residential private construction, spending on commercial construction rebounded (+1.2% on a month, -11.3% on a year), and offices continue to rise (+1.1% over one month 4.4% year on year).

The expenditure of public construction (29% of the total) are near their historic record of August, up in October by 0.7% from September and 7.4% in one year.

Those of the federal state grew faster (+5.5% compared to the previous month) than those of states and local communities (0.3%).