The Mortgage Bankers Association (http://www NULL.mbaa NULL.org/NewsandMedia/PressCenter/75572 NULL.htm) says mortgage rates have continued to remain historically low, while mortgage volume has picked back up following a drop the week before.
The group says that 30-year fixed-rate mortgages during the week ending January 28 had an average interest rate of 4.81 percent, up just slightly from 4.8 percent the week before.
The MBA's weekly report also showed a sharp increase in applications compared to the previous week, which was skewed by the influence of the Martin Luther King holiday. Purchase applications gained more than 9 percent while refinancing numbers increased by nearly 12 percent.
"Applications increased this week relative to the holiday week," said Michael Fratantoni, MBA's vice president of research and economics. "Looking over the past two weeks, purchase applications are flat, and refinance applications are down about five percent."
However, interest rates aren't expected to stay low forever. The MBA's recent forecast for 2011 predicted that rates would be 5.3 percent by the end of this year, which would increase the cost for people looking to buy Houston homes.
Mortgages rates remain steady as applications bounce back
Senate passes Bailout – Making Sense of it All
The Senate passed the 700 Billion dollar Bailout of Freddie Mac and Fannie Mae today. I am curious if everyone out there knows what these companies do and why the Government stepped in to help out.
First, to help clear some of the confusion, these two companies are mortgage guarantors. Fannie Mae was created back in the Great Depression by Roosevelt’s administration to back loans by private banks in order to make homeownership more assesible. Years later the government allowed Fannie Mae to be privately managed. Freddie Mac was created by the government to keep Fannie Mae from becoming to big.
Fannie Mae and Freddie Mac guarantee more than $5 trillion in mortgages, almost half of those in the United States, With many of the mortgages defaulting, the companies are, in effect, bankrupt. These two companies are such a large part of our financial system that failure of one or both would be detrimental Nationally and Globally.
This takeover was put in place to protect us, the taxpayer. How, well the U.S. government will be creating more demand in the marketplace by buying Fannie and Freddie mortgage bonds, homeowners and buyers should start seeing lower mortgage rates. This may become one of the best times to purchase or refinance your home.
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