Fannie Mae and Freddie Mac were taken over by the government yesterday, a financial bailout that will ultimately be paid for by taxpayers. The takeover was to avoid a massive failure of a private enterprise that would have far reaching, negative affects on the financial markets and the US economy. The intent is to stabilize the financial and real estate marketplace, providing financial and psychological stability to investors

What are the ramifications as real estate professionals and to our purchasers & sellers?  At present, it is uncertain.  The following is just conjecture:

-The takeover will probably stabilize the company's bonds, providing a short term rate drop or stabilization.
-The takeover will cost a lot of money.  Banks may be eventually charged more to sell loans to generate more income for the entities, thus, passing higher rates to the consumer

-The takeover will mean that loan underwriting standards may eventually change, maybe more conservatively.
-Foreclosures and workouts will most likely be more "consumer friendly"

The system is still working and money is still available.  Rates are at 2008 lows!  Stay tuned.

As always, never hesitate to contact me with any questions!