The Treasury Department and the Federal Reserve Board have been purchasing mortgage-backed securities from Fannie Mae and Freddie Mac for a little over a year. These efforts have helped bring down long-term interest rates and provide the housing industry with some price stabilization. Recently, some National Brokers have discussed the likeliness of the Federal Government backing away from this program and what effect that would have on the marketplace.

These brokers believe that even if Federal purchases of these securities were to go away, that interest rates would only rise negligibly — to maybe as high as 6%. That would still be an historically low rate and probably would not be enough of a hardship to slow down sales — especially if job losses continue to fall and employment begins to rise.

So if the economy continues in the right direction, consumers will begin to act and buy more houses, the brokers believe. They also believe that they would rather be selling houses than selling anything else in 2010!

This entry was posted on Thursday, February 11th, 2010 at 1:00 am and is filed under Mortgages. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.