The Mortgage Bailout and You

With the U.S. Treasury's takeover of Fannie Mae and Freddie Mac, what are the implications for home owners and those looking to purchase a home?

  1. Mortgage rates are probably headed lower.  Shortly after the market open on September 8, the national average on 30-year fixed-rate mortgages dropped from 6.55% to about 6.2%.  The magnitude of the drop in rates and over what time period is far from clear.
  2. A turnaround in housing will take time.  While the massive oversupply of homes for sale won't be unwound merely by lower lending rates, they should be a helpful factor.

For additional details on these matters, please click here for an article from MarketWatch.