Supcoffconstructionlaw's Weblog

Current State of the Mortgage Market
December 2, 2008, 2:06 pm
Filed under: News Clippings, Residential Real Estate

The Federal Government has taken important steps to increase mortgage activity, including increasing loan limits for Fannie Mae, Fredie Mac and the FHA and agreeing to buy $600 billion of mortgage debt from Fannie and Freddie.  The latter announcement resulted in mortgage rates on government backed loans dropping by a third of a percentage point.  However, self-employed borrowers and nonconforming or “jumbo” loan borrowers (loans in excess of $417,000 to $729,000, depending on the market) are finding it difficult to obtain a bank loan, even with good credit and savings, because lenders are relying heavily on loans gauranteed by Fannie Mae and Freddie Mac and the FHA.    The Personal Journal of today’s Wall Street Journal has an informative article on this situation including some tips from mortgage brokers on how borrowers can improve their chances of obtaining mortgage financing.