Executive Perspectives Blog
Refinancing is Freddie Mac's bread and butter in today's marketplace. Mortgage refinances represented an estimated 78 percent of our single-family purchase volume in 2011 and 80 percent in 2009 and 2010. In the last three years, we refinanced about $930 billion in mortgages – helping nearly 4.3 million American families lower their payments or shorten their mortgage terms.
This translates into real money for borrowers. For example, the borrowers we helped to refinance in 2011 will save an average of $2,700 in interest payments over the next year. That's about $2.7 billion that these homeowners will have to spend, save, or invest because we were there to supply the credit their lenders needed to close their new mortgages.
Mortgage fraud doesn't look like a TV crime scene with yellow tape and flashing lights. It generally doesn't show up on security camera footage or in the sort of dramatic photos that make the front page or go viral on the Internet. That's because mortgage fraudsters, like any predators, rely on camouflage to hide their intentions and lull their victims into a false sense of security.
Freddie Mac's fraud investigation team has over 20 years of field experience uncovering such "camouflage" and helping law enforcement agencies prosecute mortgage fraudsters.
Mortgage rates are at 50-year lows – the 30-year fixed-rate mortgage averaged 3.95 percent at the close of 2011 – making homeownership more affordable than ever for families with a stable income and good credit. But before you begin house hunting in earnest, it's important that you get the facts about buying a home in today's market. Because whether you're shopping for your first home or your third, there are some "rules of the road" you'll need to understand.
Here are four steps you should take as soon as you start thinking seriously about buying a home:
With the New Year fast approaching, ‘tis the season to assess the 2012 outlook for the macroeconomy and housing market. Here are five items from our crystal ball.
Economic growth will likely strengthen to about 2.5 percent in 2012.
U.S. economic growth appears to have accelerated in the waning months of 2011, with fourth-quarter growth expected to come in around 2.5 to 3.0 percent, annualized, by most forecasters. Evidence to support the pick-up was stronger retail sales, low inventory levels, and a 477,000 three-month gain in private non-farm payroll employment from August through November. Given the anemic 1.2 percent annualized growth over the first three quarters of the year, the final quarter could provide some needed momentum as we head into 2012.
Most discussions today about the future of the housing finance system begin with two related ideas: (1) private capital must return to the market; and (2) the role of the federal government should be reduced. These ideas are a sound starting point for the detailed reforms that must follow.
It's not Freddie Mac's role to advocate any particular position in the discussions about our future. Instead, our efforts are focused on helping the nation combat the housing and economic crisis – which is exactly what taxpayers should expect of us. Our role in the policy discussions, based on much specialized expertise, is simply to provide information and perspective.
