I have been hearing rumors about this for a long time and now it has finally become a reality. We the people of United States of America, now own the two biggest backers of mortgages in America, Fannie Mae and Freddie Mac.
This means that all of the tax payers will now be footing the bill to help keep these two companies afloat, during these wicked times.
I’m not sure how I feel about this event. I do believe in a free market, but at the same time I think we are at a major financial cross road. What happens if we don’t bail out these big companies? Huge job losses? The world withdraws all of their money out of our economy?
Truth is that no one really knows. All I can do is trust the people who are in place and hope that they have American’s best interest in mind, rather then the upper 1% of Americans.
What does this mean to the mortgage market?
Not much will affect the average consumer, besides that mortgages will still be available to the public, because if these two companies went out of business, mortgages would be really hard to come by for a long time. It might also help to stabilize rates, because now the treasury is backing the debt.
