December 11th, 2008

Mortgage Rates Falling



Good news for loan shoppers: the rate on a 30-year fixed rate mortgage dropped to 5.49% Wednesday evening from 5 .54% on Tuesday. Fixed rates have continued to ease since the Fed announced their $600 billion initiative to buy Fannie and Freddie debt and mortgage-backed securities (MBS).

The Fed’s plan to purchase $100 billion in F&F’s debt will serve to tremendously ease their costs. The central bank’s guarantee to purchase $500 billion in MBS has generated a new buyer in the market, accomplishing the goal of allowing fixed rates to drop further.

If you caught wind of the rumor that the Treasury Department was working on a program to lower rates to 4.5%, you would have noticed there has been little to no mention of it since. Media outlets broadcasted it as a possible initiative, when in reality it was merely just a topic of discussion. If you’re interested in reading more about it, be sure to read our post “More Isn’t Always Better.”

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About the HSH Blog's daily blog focuses on the latest developments in the mortgage and housing markets. Our mission is to relate how changes in mortgage rates and housing policy, as well as the latest financial news, impacts consumers, homebuyers and industry insiders alike. Our 30-plus years of experience in the mortgage industry gives us an edge as we break down the latest changes in an ever-changing market.

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Tim Manni

Tim Manni is the Managing Editor of and the author of their daily blog, which concentrates on the latest developments in the mortgage and housing markets.

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