Real Estate News Flash
Fannie and Freddie: What the Bailout Means. Mortgage Rates Have Dropped & Buyers Are Buying!
The U.S. government takeover of Fannie Mae and Freddie Mac made history Sunday as they seized troubled mortgage giants Fannie Mae and Freddie Mac in a bid to help reverse a prolonged housing and credit crisis. Immediately Wall Street posted a huge rally Monday as investors reacted with enthusiasm to the government's actions. The Dow Jones Industrial average gained nearly 300 points in the day's trading. So, what do you know about these mortgage giants?
Think of Fannie and Freddie as hybrids. They are both government sponsored and shareholder owned. They do not have direct contact with consumers; instead, they work with lenders. The job of Fannie and Freddie is to buy mortgages from banks, savings and loans, credit unions, and other lenders to ensure that mortgage funds are consistently available. Together, they hold or guarantee about $5 trillion in home loans which is nearly half of the country's oustanding $12 trillion in home mortgage debt.
What spurred the governement bail out?
What's happening locally?
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