CSBJ Daily

Government intervention at Fannie Mae and Freddie Mac this weekend might finally give home sellers, Realtors and builders a light at the end of the mortgage and real estate tunnel.

Today, 30-year fixed rate mortgages dropped to 5.75 percent, and a 15-year fixed rate loan fell to 5.375 percent.

Conventional loan requirements had squeezed many formerly qualified borrowers out of the market during the past 12 months. In contrast, Ginnie Mae which provides government-secured FHA loans saw loan activity increase by as much as 19 percent in from July to August.

Wayne Bland, vice president and chief lending officer for Rocky Mountain Bank and Trust of Colorado Springs, said he expects to see an increase in both conventional and FHA/VA home loan applications based on the latest news.

“For those with good credit, the fact that the government has stabilized the market and enabled better interest rates could be a real incentive,” he said. “Here in El Paso County, I think the home prices have pretty much reached bottom. Like the rest of the country, we have suffered from buyer reluctance and tighter credit.”