I came across some information from the National Association of Home Builders this morning that indicates that some types of mortgage rates will be lower through 2009 than they had expected.  Another article they posted
described the current demand for housing is begining to stabilize and is being supported by federal programs and the decrease in mortgage rates.  Here is some of what they had to say:

The Stampede Toward Credit Quality Drives Down Home Mortgage Rates

The silver lining amidst the most recent round of financial market turmoil has been a massive flight to the Treasury securities market and to markets for securities that have strong federal backing, a flight that has driven prices of these investments upward, and their required yields downward.

In the mortgage market, the key beneficiaries have been FHA and VA loans that have the backup of the Ginnie Mae-guaranteed securities program, and prime conventional conforming mortgages saleable to Fannie Mae and Freddie Mac — companies that now have had the explicit backing of the federal government since Sept. 7.

Rates on these types of mortgages have fallen sharply in the past two weeks, and NAHB’s forecast shows a significantly lower profile of mortgage rates through 2009 than we had expected a month ago.


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