Rate Update September 9, 2008

Mortgage rates have now dropped .50% in two days following the announcement over the weekend that the government would takeover Fannie Mae & Freddie Mac. How long will the rally last?

Most analysts are of the opinion that mortgage rates are likely to continue to improve as foreign investors regain confidence in mortgage backed bonds. However, we don’t expect an improvement to occur in a straight line. There will continue to be oscillations.

In case you missed it yesterday I have created a you tube video and posted it on my blog explaining why this weekend’s announcement is helping mortgage rates.

Current Outlook: neutral short-term, floating long-term

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