4.5% interest - don't expect it soon.
As we wrote hear previously, The Fed has indicated that they would like to buy Mortgage Backed Securities in an attempt to trick the market into having lower fixed rates right now. Talk has been of about 4.5%.
The rumors of this action has caused many people to wrongly sit back and wait.
At this time, this plan is little more than talk.
The is no plan, no indications whatsoever that it is ever going to happen, no direction as to who may qualify, under what terms and guidelines, and is it just purchase transaction, or refinances too.
Many of the legislative "savior" actions recently are really thinly veiled jokes. Programs like FHASecure, and Hope for Homeowners, which sounds good in 15-second clips of Rep. Barney Frank praising Congressional action, are in reality, gigantic failures. They help very few people because of all the restrictions to the programs, and the unfunded hope that others (like banks) will participate. The Hope for Homeowners program is so bad, many in the industry have been calling it "Hopeless for Homeowners".
To make it worse
Many lenders are calling people and pretending like 4.5% is coming soon. There are telling people to get their "application started" and to "send in your pay stubs". Clearly these people are not whom you should be making some of the biggest financial decisions of your life with.
Bottom line:
If it makes sense for you to take advantage of TODAY'S real historic rates, DO NOT HESITATE to act NOW.
Joseph: Nice post! I'd like to follow-up with the thought that even if there are 4.5% rates, it may not make a difference. We're in an economic funk right now and only time will get us out of it. Plus, credit is so tight that alot of people hoping to get loans will not be able to.