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THURSDAY, NOVEMBER 26, 2009
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Treasury May Lower Mortgage Rates to 4.5%

Rates could go as low as 4.5% to curb falling home prices

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(Newser) – The Treasury may try to bring new mortgage rates down to 4.5%—a full percentage point lower than current rates—to revitalize the housing market, the Wall Street Journal reports. Under the proposal, which is still in the early stages, the department would use Fannie Mae and Freddie Mac to lower the rates. The idea comes after months of struggling to hatch a plan to reduce foreclosures and stem falling prices without directly bailing out borrowers and lenders.

Troy Courtney stands on the porch of his foreclosed California home. Lower mortgage rates could revive the slumping housing market.
Troy Courtney stands on the porch of his foreclosed California home. Lower mortgage rates could revive the slumping housing market.   (AP Photo/Noah Berger)
The Treasury is devising a plan to curb falling house prices.
The Treasury is devising a plan to curb falling house prices.   (AP Photo/David Zalubowski)
A real estate agent stands outside a $1.5 million home in Florida. Lower mortgage rates could get the market moving again.
A real estate agent stands outside a $1.5 million home in Florida. Lower mortgage rates could get the market moving again.   (AP Photo/Marianne Armshaw)
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Shannonals
Dec 3, 08 4:44 PM CST
All talk until they do it. Reply
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justme
Dec 3, 08 7:42 PM CST
When does the government cross the line from encouraging the economy to running it (as in socialist-leaning countries)? Reply
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