Obama Plan for Troubled Housing Market
Today, President Obama unveiled his plan to help the US to stabilize its housing market by pledging up to $275 billion in an effort to help ward off a wave of home foreclosures. By the end of 2008, over 9 percent of home loans in the US were either in arrears or already in the foreclosure process. It is estimated that up to 16 percent of all households with mortgages could fall into foreclosure by 2012.
Yes, it is a tough pill to swallow, but bailing out overextended homeowners with taxpayer dollars appears to be a better scenario to an all-out collapse in the housing markets.
The plan also calls for a $75 billion fund to reduce mortgage payments for up to 4 million Americans that are stuck in subprime mortgages that they cannot afford.
For the rest of the refinancing public that have current adequate equity, good credit scores, and manageable payments, mortgage rates are still at historic low levels. Those in current mortgages at 6.25% and higher stand to benefit with significant savings by refinancing into lower rates or into lower terms. For those that want, or need to consolidate debts, this is a great time.
The key for the current awesome refinancing loan options, (I know, I sound like a broken record), is your home’s current market value. All of this foreclosure activity, combined with tighter lending standards has done a number on home prices, depending upon the area that you live. Getting a solid handle on your home’s “real” market value will help you to choose the proper refinance program, or help you to avoid a potential non-benefit situation by getting pre-qualified with an inflated home price.
Refinance rates have been relatively flat over the past week, which is actually a good thing at current levels. We’ll have to wait and see whether Obama’s plan for the housing market will relieve some fear (reduce risk) in the mortgage lending market. If this is the case, the risk premium could drop a bit and home loan rates could fall a bit more.
The economy is still a mess and there is no end in sight, so treasury yields will likely stay in the 2.5 to 3.0 percent range for the immediate future (a good thing for mortgage refinance rates).
Let’s look on the bright side. The economy stinks, many have lost jobs or anticipating a job loss, salaries are on the decline, retirement accounts have been slashed, and the housing market is colder than Alaska in January, but at least mortgage rates are low! Hey, you have to take good news where you can get it!
May the Mortgage Refinance Rates be with You!
Refinance Tool Box
Yes, it is a tough pill to swallow, but bailing out overextended homeowners with taxpayer dollars appears to be a better scenario to an all-out collapse in the housing markets.
The plan also calls for a $75 billion fund to reduce mortgage payments for up to 4 million Americans that are stuck in subprime mortgages that they cannot afford.
For the rest of the refinancing public that have current adequate equity, good credit scores, and manageable payments, mortgage rates are still at historic low levels. Those in current mortgages at 6.25% and higher stand to benefit with significant savings by refinancing into lower rates or into lower terms. For those that want, or need to consolidate debts, this is a great time.
The key for the current awesome refinancing loan options, (I know, I sound like a broken record), is your home’s current market value. All of this foreclosure activity, combined with tighter lending standards has done a number on home prices, depending upon the area that you live. Getting a solid handle on your home’s “real” market value will help you to choose the proper refinance program, or help you to avoid a potential non-benefit situation by getting pre-qualified with an inflated home price.
Refinance rates have been relatively flat over the past week, which is actually a good thing at current levels. We’ll have to wait and see whether Obama’s plan for the housing market will relieve some fear (reduce risk) in the mortgage lending market. If this is the case, the risk premium could drop a bit and home loan rates could fall a bit more.
The economy is still a mess and there is no end in sight, so treasury yields will likely stay in the 2.5 to 3.0 percent range for the immediate future (a good thing for mortgage refinance rates).
Let’s look on the bright side. The economy stinks, many have lost jobs or anticipating a job loss, salaries are on the decline, retirement accounts have been slashed, and the housing market is colder than Alaska in January, but at least mortgage rates are low! Hey, you have to take good news where you can get it!
May the Mortgage Refinance Rates be with You!
Refinance Tool Box
Labels: business, economy, finance, money, mortgage rates, refinance, refinance rates, refinancing
posted by Jim Bisnett at
11:39 AM
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