U.S. weighing new mortgage plan

According to sources the government is expected to soon announce that $50 billion will be devoted to addressing the mortgage crisis.

The government is expected to announce soon that it will devote up to $50 billion to directly address the source of the financial crisis: bad mortgages and millions of homeowners at risk of foreclosure.

White House spokesman Tony Fratto said on Thursday that “no decisions” have been made on “a number of housing proposals” that the administration has been reviewing “for some time.”

But three administration officials indicated to CNN that the new program would be designed to prevent foreclosures by having lenders reduce delinquent borrowers’ mortgage payments to affordable levels. In exchange the government would guarantee some percentage of each loan to backstop lenders if borrowers re-default on modified mortgages.

At this point, the integrity of the markets is critical.  Investor confidence is ever so important.  So, any injection of economic fuel into this economy will benefit real estate investors.  Keep an eye on this one.  There are certainly some positive benefits from this that could go into the pockets of real estate investors.  Hopefully very soon.

30 year mortgage rate - Bullish for real estate investors

I found this great article, giving me an indication not everything is bad in the real estate sector:

Rates on 30-year mortgages dropped sharply this week, falling to the lowest level in five weeks.

Mortgage giant Freddie Mac reported Thursday that 30-year, fixed-rate mortgages averaged 6.04 percent this week, down from 6.46 percent last week. The sharp decline pushed 30-year rates down to the lowest level since they stood at 5.78 percent the week of Sept. 18.

Analysts attributed the decrease to an easing of inflation concerns which now have been replaced with rising worries that the country could be headed for a prolonged recession. Interest rates generally fall in periods of economic weakness.

While this change may be good for investors, it is still concerning me that this is occurring, primarily, because economists fear that we are sinking into a recession.  Naturally, that is a great cause of concern.  Regardless, it is always good to see something for real estate investors to at least be enthusiastic about.