All good things must come to an end.   After the Fed has pumped 1.25 trillion into the ailing mortgage market , it comes to an end on March 31st.    Mark Zandi, chief economist with Moody’s Economy.com states, “This spring and summer as  those policy efforts unwind, we most likely will see mortgage rates rise and more home price declines”.  

                                  

    The biggest change in the mortgage market has to do with mortgages formerly being held by Fannie Mae, Freddie Mac and Ginnie Mae, are now being purchased by the Fed, thus creating liquidity for home loan monies.   It is estimated that these funds will be returned to the Fed perhaps with a small profit but, at least close to the equity value.  This remains to be seen as several land mines that are now in place such as unemployment, commercial loan availability  and Europe’s financial problems materialize.

    It is clear that with Fed help still in place until March 31st and interest rates still at an all time low, a strong case can be made to get off the fence and buy that home you have been looking at, now.  If escrow has been started before March 31st, all good things still apply.  Estimates are that interest rates will rise from 5% to 6% when the Fed cuts off its’ program.

    Truckee, Lake Tahoe as well as Tahoe Donner still have properties that qualify for favorable treatment, but time is getting short.  Less than 6 weeks to act.

Don Schaller
Broker/Owner
Schaller Family Realtors
Dickson Realty, Truckee
Truckeehomefinder.com