Fannie, Freddie and Interest Rates

The federal take over of Fannie Mae and Freddie Mac have sent shock waves through the financial market and concerns not to be taken lightly by each of us taxpayers but what about the effect on the real estate market?

One nearly instant effect has been the 4 tenths of a percent drop in the interest rate on a 30 year fixed rate mortgage. Two weeks ago the 30 year fixed rate was hovering near 6.5% today a person can get the same loan at less than 6%.

Keep you eye on other developments that should be coming soon. Some other fees such as the up front delivery fee and "G-Fees" charged by Fannie and Freddie are likely to be eliminated or substantially reduced by the new management in the coming months.

This is good news for buyers in a market of lower home prices and should also be good for sellers with competitively priced homes.

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