Effects of government’s mortgage overhaul to start early

The winding down of Fannie Mae and Freddie Mac will make a big impact in the next few months.While lawmakers in Washington are working to wind down Fannie Mae and Freddie Mac over the next five or seven years, real estate experts say the impact from those decisions will be felt well before those changes become final.

Mortgage experts told the New York Times (http://www NULL.nytimes NULL.com/2011/03/06/realestate/mortgages/06Mortgage-fannie-freddie NULL.html) that those looking to buy a home could see higher mortgage costs even within the next year. That's because while some parts of the plan require approval from Congress, others don't, and could be in place quickly.

"There's a lot of uncertainty in the process," Barry Zigas, the director of housing policy at the Consumer Federation of America, told the paper. "but you're probably going to get a better deal on a fixed-rate loan sooner rather than later."

Other analysts said that in the coming months, banks may try to promote adjustable-rate loans instead of fixed-rate mortgages, because they generally bring in more money.

However, that would not be the preferred choice of most people looking at Houston homes. A survey last year by Fannie Mae found that borrowers with fixed-rate loans were more satisfied than those with other mortgage types.

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