On December 4^th details of a Treasury intervention to bring mortgage rates down to 4.5% was leaked.  This news was not supposed to be released as the plans are still under discussion.  I have not commented on this topic because I wanted to see if more concrete news was going to be released but at this point nothing new has come out and I feel it's my job to give my opinion on the topic.

First, at this point the plan is just speculation, so I'm remaining central on the issue. 

From what we're hearing the plan will only be eligible for first time homebuyers (people who have not owned a home within the past 3 years).  The 4.5% will not be available for refinancing or buying an investment property.   In my opinion the plan should included refinance loans.  For the people whose budgets are tight the drop in rate to 4.5% would allow for more spending thus help the economy.

Going into the New Year and new leadership I think the 4.5% would be great for the Denver housing market.  As a relatively strong market the 4.5% would incent more fence sitters to buy homes.  The more buyers we have in the market the less supply Denver has which will level home prices out if not drive them up. 

I plan on updating readers on this topic as often as news is released.  If you are interested in refinancing or buying a home in the near future this news directly affects you.  To be added to my email list send me an email: mshotnik@summit-mortgage.com