MADISON, Wis. (9/9/08)--The government's bailout of mortgage giants Fannie Mae and Freddie Mac may impact credit unions' mortgage portfolios with a slight slowdown, according to Bill Hampel, chief economist at the Credit Union National Association (CUNA).
On Sunday, the U.S. Treasury announced it would place Fannie and Freddie into a government conservatorship because failure of either would be chaotic to the market
"The Treasury's action will restore some normalcy to the conforming segment of the mortgage securities market," Hampel said.
"In particular, conforming mortgages will become more available than they have been in the past several weeks.
"The rates at which credit unions will be able to sell loans to Freddie or Fannie will come down a bit, and other lenders will become more active than they have been recently," Hampel told News Now.
"This might slow the demand for mortgage loans slightly at credit unions," he said.
Fannie and Freddie own or guarantee nearly half of the $12 trillion in U.S. mortgages. (USA Today Sept. 8).
courtesy of cuna.org