We have known for some time that artificially created low mortgage interest rates we have seen in 2009 wouldn’t last forever. The end to those low rates seems to be upon us now. There was a good article in the WSJ recently on some of the details. Here is a snippet from that piece:
The days of record-low mortgage rates are numbered.
The U.S. government is slowly extracting itself from the market for home loans, closing out several emergency measures put into place in the throes of distress last year to prevent a collapse of mortgage finance.
The Federal Reserve’s $1.25 trillion program to purchase mortgage-backed securities, considered the most critical support, will draw to a close in the first quarter of 2010. Fannie Mae, Freddie Mac and Ginnie Mae will then be without a government buyer of last resort for their home loans for the first time since the mid-1990s and will have to rely solely on private investors.