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Interest Rates Stop Falling and Start Rising

by Pistol Tingen

After a slow steady decline, interest rates started to head up this week. But they're still incredibly low and with home prices still down, it's a great time to buy.

U.S. Government to the Mortgage Rescue?

by Pistol Tingen

 

Before the weekend comes to a close, both FannieMae and FreddieMac may lose control to the United States Treasury Department.   Steven Adamske, spokesman for House Financial Services, stated, “We are waiting to see what the details are”.

Both FannieMae and FreddieMac currently buy and package mortgages for other investors, and together hold or guarantee $5 trillion in housing debt—a figure that represents nearly half of the nation’s total.  The financial health of these two mortgage giants is critical to the housing market.

FreddieMac and FannieMae  are chartered by the government but are shareholder owned—funded solely with private capital raised from investors on Wall Street and around the world. Without question, they are the nation’s main source of liquidity for home loans.  At the present time, neither mortgage company appears to be in imminent danger of failure.

The plan under consideration could place Freddie and Fannie under federal control, and could include steps to dilute common stock while sheltering the agencies from financial losses. 

Federal intervention could serve as a partial remedy to help correct the slumping housing market by easing fears about the solvency of FreddieMac and FannieMae.  Both Freddie and Fannie could then obtain funding easier, which could lead to lower interest rates on mortgages and provide a jolt to the housing market.

Mark Zandi, chief economist and co-founder of Moody’s Economy.com, commented, “It’s a bold move and it certainly has big plusses.  Mortgages rates would lower and more credit would be available.  Stepping in like this will be a big shot in the arm to the stock market and bond market.  It’s a very positive step.”.

Certainly these are some changing times in the entire real estate market.  Throughout the fluid housing market of Greenville, NC – Pitt County, The Pistol Tingen Team continues to offer unwavering, professional real estate service to the community. Whether buying or selling, please contact us (252) 321-6161 for all your real estate needs.

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BERKSHIRE HATHAWAY HomeServices Prime Properties,   Greenville, NC, 2625 Charles Blvd.

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