Massive Mortgage Changes Coming That Will Affect Home Loans | Sun Valley Real Estate



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Big news in the real estate world today!

Fannie/Freddie On Chopping Block –The white house came out with their mortgage reform options today, including the shut-down of Fannie/Freddie. There is a lot of analysis going on, here’s some from



The Obama administration laid out three broad options Friday for

reducing the government’s role in the mortgage market. All three would

almost certainly lead to higher interest rates and costs for borrowers making it even harder to qualify for a home loan.

The administration said in a report that the government should withdraw its support for the mortgage market slowly, over five years or more. The report describes a path for winding down the troubled mortgage giants Fannie Mae and Freddie Mac.


rather than making a single

recommendation, the administration offered

Congress three scenarios and

will let lawmakers shape the final policy.

The options are:

No government role, except for existing agencies like the Federal Housing Administration.

A government guarantee of private mortgages triggered only when the market is in trouble.


insurance for a targeted range of mortgage investments that already are

guaranteed by private insurers. The government guarantee would kick in

only if those private companies couldn’t pay.


private sector will assume a greater role in housing finance under all

of the options. The government currently owns or guarantees more than 90

percent of new mortgages.

The actual report – If you prefer to read things for yourself, below is the report,


to .

Windermere Real Estate, Sun Valley – Hailey, Idaho @ George Martin, Jr. Associate Broker

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