Fannie/Freddie Bailout Improves Interest Rates… a lot
Yesterday the government announced its takeover of Fannie & Freddie, which are the (formerly semi-private) institutions responsible for insuring the bulk of our country’s home loans. There is a lot of controversy over whether this was the right call, and speculation about how the dust will settle in the longer-term economic outlook.
Meantime, check out what happened to rates this week:
- For loan amounts below $417,000, rates dropped .625% to 5.625%, representing savings of up to $217 per month!
- For loan amounts below $697,500, rates dropped .625% to 5.75%, representing savings of up to $363 per month!
The technical term we use for this type of event is, well… bitchin’.
While I do see rates climbing significantly over the next couple of years, I have no idea whether this rate level is sustainable for the short-term. To see how this affects your own refi, purchase, or sale scenario, feel free to ask Seth.