OFHEO Assists to Alleviate the Credit Crunch

OFHEO Steps Towards Alleviating the Credit Crunch and Improving The Housing Market

By giving Fannie Mae and Freddie Mac more flexibility to address problems in the mortgage market it will benefit the housing market. In providing the ability to make a two percent adjustment to the portfolio limit formula for Fannie Mae, like Freddie Mac currently has, OFHEO has provided another tool to help borrowers with more sub-prime loans and others having problems refinancing their mortgage.

We are seeing that it is becoming a better time to buy a home. With both houses of Congress to reform FHA programs, and the Federal Reserve to decrease interest rates, should make borrowing more affordable and money more available. With reduced housing prices and increased housing inventory, interest rates that are near historic lows, and now with Fannie’s and Freddie’s increased ability to lend, we may see positive movement in the housing market.