Saturday, September 13, 2008

Some good news for buyers and sellers!

In the past week there was a federal bailout of Fannie Mae and Freddie Mac suggesting that the mortgage market was in serious condition. If you listen to the “talking heads” on the cable news programs, they would have you believe that the US banking system is in serious jeopardy of systemic failure. It was also reported this past week that another investment bank- Lehman Brothers was in deep financial distress… again threatening the viability of the US banking system.

No wonder the average person hasn’t got a clue as to what to do next. If you were thinking about buying a house and have good credit, you are probably sitting on the fence regarding the purchase given all of the uncertainty in the economy and the mortgage market. In some cases, you may have been unable to qualify for a mortgage given that banks have dramatically tightened up their standards.

If you have been trying to sell your house and it has been on the market for more than 6 months, you are probably getting pretty discouraged and very concerned about what to do next.

The article in today’s Springfield Republican reported that mortgage rates have dropped significantly (from 6.00 – 5.75%) in the past week as a result of the Fannie Mae/ Freddie Mac bailout and are expected to go lower. Local real estate agents have reported an increase number of phone calls and mortgage applications this past week.

There is a new feature on the Real Estate Buzz at LongmeadowBiz blog that tracks mortgage rates. If you are looking for a home, keep an eye on these rates because a lower mortgage rate will result in a significant drop in monthly payments and help improve the “affordability” of homes up for sale.

The drop in mortgage rates is good news for both buyers and sellers.