Republicans Want Low Rate Mortgage in Stimulus – Obama Agrees
Posted on | February 4, 2009 | 8 Comments
Republicans want a bill of the $900 billion stimulus to include a stipulation that would drive mortgage rates to as low as 4%. This is thought to start the rebound in the housing market. Current rates average approximately 5.1% so the plan would cut over a full point off mortgage rates which would put a great deal of money back into the pockets of homeowners who refinance at the low rates. President Obama and his economic staff agree that getting mortgages lower is a good idea.
Estimates show that every percentage point drop in mortgage rates would spark half a million in home sales. While there is still a long way to go to recovery in this housing market, this would definitely be a great start. This will also help to reduce the amount of excess inventory in the struggling housing markets in the United States. Sadly, demand for housing has grinded to a halt in the last year so getting Americans excited about home buying would be great for the economy.
Democrats and Republicans agree that the economy needs a transfusion of federal aid, but the amount of aid and where the aid will come from has been a sticking point for the two sides. President Obama has stated from the beginning of his campaign that he wants to unfreeze credit and this would definitely be a start. Do you think lower mortgage rates will be part of the stimulus plan?
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8 Responses to “Republicans Want Low Rate Mortgage in Stimulus – Obama Agrees”
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February 5th, 2009 @ 12:25 pm
lowering mortgage rates is one of the best things that can happen now. IT WOULD FREE UP MONEY FOR MORE CONSUMERISM. IT WOULD HELP PEOPLE KEEP THEIR HOMES DUE TO A LOWER MONTHLY PAYMENT. It would help people get out of this panic mode.
February 5th, 2009 @ 12:35 pm
The problem is not the rates. The problem is no one is lending on purchase transactions. Until someone will finance home loans, we can have 0% and it won’t get the housing market moving again until someone lends. Prices will continue to plummet until buyers can obtain financing. You can still obtain a true conforming loan if you have a big down payment & great FICO scores. It’s the over $417K market that is getting hammered.
February 5th, 2009 @ 12:54 pm
I think that there is a better way to deal with our economy situation. What I recomend is for the government to pay directly to mortgages company a healthy percentage of every home owner mortgage loan and enforce that the bank readjust the loan without any fee charges and in top of that to switch the loan to a fix low rate. Also without adding more years to the loan modification/adjusted. For example those people who have left 15 years left on their loan don’t want to go back to a 30 years loan even if they know that they will save some money monthly. The mayority wants to finish their mortgage as soon as possible. If the government do it this way then they knows that the money went directly to the home owner mortgage. On the other hand the home owner will end having more money on their budget to expend it in the economy. Probably at this time they have money to boost the automobile industry because they probably have extra money to buy a car. Then for those who do not have a real estate property they can receive an incentive basically the same way that the government were doing in the past.
Ramos Luciano
February 5th, 2009 @ 1:57 pm
A great idea to get housing going again.
February 5th, 2009 @ 2:05 pm
i do think lower mortgage rate will be a difinate plus to stimulate the economy and will get people to want to purchase houses and refinance.
February 5th, 2009 @ 4:45 pm
we need to stop the foreclosures which are driving up the inventory and creating a glut.There needs to be a moratorium on foreclosures for 18 months.This will also make the lenders more accountable.
February 5th, 2009 @ 5:22 pm
[...] Republicans Want Low Rate Mortgage in Stimulus – Obama Agrees [...]
February 5th, 2009 @ 5:32 pm
This won’t do anything for most of the people I know, in Az on my street everyone is upside down, houses with 225K mortgages are on the market for 84K and not selling and going to auction, other sold for 189K last yr and are now not selling at 74K We live in a poor neighborhood and people pay about 5K a yr in income taxes here, if the rate is cut to zero and so are taxes it won’t help us.