Fannie and Freddie taken over, mortgage rates down sharply

September 8, 2008 | Leave a Comment

With the federal goverment seizing control of Fannie Mae and Freddie Mac , it should be no surprise that mortage rates are down sharply.

Actions by the Treasury were meant to stabilize financial markets and ensure mortgage availability and affordability. Mark Zandi, Chief Economist at Moody’s Economy.com said, “Effectively, the federal government has now become the nation’s mortgage lender. This takes a major threat off the table.” He notes that 30 year mortgage rates, currently averaging 6.35% nationwide could dip to 5.5% because investors will be more willing to buy the debt issued by Fannie and Freddie – and at lower rates – since the federal government is now explicitly standing behind the debt.

I just got a new rate sheet from one of my preferred lenders quoting a 30 year fixed rate mortgage at 5.625% with a one percent origination fee and at 5.875% with no origination fee, both rates are down sharply from just last week.

Technorati Tags: Fannie Mae, Freddie Mac

Posted by Howard | Filed Under Blog, Mortgage / Finance

A look behind the numbers

September 5, 2008 | Leave a Comment

The doom and gloom headlines in foreclosure and mortgage delinquencies are being strongly influenced by what is going on in just two states, California and Florida.

“The national foreclosure numbers continue to be driven by the hardest hit states continuing to get much worse. The increases in foreclosures in California and Florida overwhelmed improvements in states like Texas, Massachusetts and Maryland,” said Jay Brinkmann, the Mortgage Bankers Association’s Chief Economist and Senior Vice President for Research and Economics. “For the quarter, a majority of the states saw relatively little change one way or the other. California and Florida alone accounted for 39 percent of all of the foreclosures started in the country during the second quarter and 73 percent of the increase in foreclosures between the first and second quarters.” (emphasis added)