Reaction to Fannie and Freddie takeover appears to be positive

I've been waiting on the sidelines to comment on the recent Federal receivership of Fannie Mae and Freddie Mac. I'm always leery of our government getting involved in the market and causing more harm than good. I am also suspect of the real motive of our politicians, many times they aren't taking action to fix the problems, but to score political points.

That being said, the effects of this action has been that rates have dropped dramatically in the last two weeks and now you can get that 30 yr fixed rate in the 5's. The market has reacted positively and the public is benefiting for now.

What I worry about is the next administration screwing up a system that has worked most of the time and has allowed home ownership to grow to its highest level in our history. I can easily see a congress with power to write laws changing down payments to 20% or something high enough to stop most new home purchases. This would shift the burden to FHA, but they have already changed their guidelines and are shutting out some groups of buyers.

If you're waiting on the sidelines trying to decide if now is the time to buy, it is! You may not have the opportunity to buy with low rates and low down payments after the new administration and congress is sworn in.