The big news over the weekend is that Fannie Mae and Freddie Mac found themselves placed under government conservatorship. Due to concerns about a mortgage market collapse should Fannie and Freddie fail, mortgage interest rates have been higher than they should be.
Now, though, with the government assuring investors (especially foreign investors) that it will back up Fannie and Freddie, things are likely to change. Indeed, mortgage interest rates are already down a bit on the news. So that is likely to make the cost of a home mortgage loan lower.
Something that is not likely to change, however, is the tightened lending standards. Tredaily reports on Fannie, Freddie and the mortgage market:
Technorati Tags: Fannie Mae, Freddie Mac, interest rates, lending standards, mortgage blog, mortgage interest rates, mortgage loan, mortgage marketBorrowers, however, shouldn’t expect the ever-tightening lending
standards to ease. With defaults and delinquencies multiplying and home
prices falling, Fannie and Freddie will likely keep a close eye on
underwriting practices. Lenders are demanding credit scores above 700
these days, up from 620 in the past, and downpayments of 20%, up from
zero in some cases, experts said.
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