What rescue means for mortgage interest rates

Bailout of mortgage giants should result in lower mortgage costs and make credit more available. But lending standards will stay tight and risky borrowers will still pay extra fees.

Sunday's federal takeover of Fannie Mae and Freddie Mac will likely translate into lower mortgage rates and greater availability of credit, experts said. Rates could drop by 1 percentage point from the stubbornly-high 6.39% for a 30-year fixed rate mortgage. The interest rates have dropped about .5% over the last two days. This is great news for buyers and anyone needing to refinance.

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Mark Thomason
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