Fannie Mae and Freddie Mac Status 09/11/2008

As you may have seen in the news lately our government in Washington DC has been busy (well kind of busy).

Just this past weekend the government announced that Fannie Mae and Freddie Mac (which own or guarantee about 50% of the nations $12 trillion in home loans) will come under direct government control.  This news  caused mortgage bonds to soar higher this week and interest rates on the average 30 Year fixed rate fell almost .75% (3/4 of a point)!  They also plan on putting over 150 billion more in home loans which may lower rates even further.

 This comes on the heals of one of the most rapidly approved bills in memory, when President Bush last month signed into law H.R. 3221, the "Housing and Economic Recovery Act of 2008," a sweeping $300 Billion rescue plan to hopefully help put the national housing market back on track.  Some of the highlights include the extension of higher loan limits at preferred interest rates and a new tax credit of $7,500 for first-time buyers.  Seller assisted down payments are set to expire Oct 1st,  but there is talk of putting them back - so stay tuned for more details on this.   These changes, along with lower home prices, makes today one of the best opportunities to buy in many years and we feel that we will look back and say what a great time it was to invest in a home for you or for an investment in real estate.