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Monday, September 8, 2008

Gov't backing Fannie and Freddie

Mortgage Bonds are soaring higher today on this weekend’s announcement that Fannie Mae and Freddie Mac will come under control of the government.

The government’s move to create a line of $200 billion to back all Fannie Mae and Freddie Mac loans at all costs is great news for homeowners. First, it ensures the continued liquidity of conforming loans nationwide and, second, it ensures that buyers of this type of Bond have a safe investment going forward. There’s no doubt that this will help the US housing market move through the current crunch that we’re in.

This announcement has reduced rates significantly. With conforming and jumbo (30) year fixed rates below 6.000% - who knows how long this window will last.

The above is today's published loan rates from First Capital Mortgage.

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