NY Fed To Buy Fannie, Freddie Securities To Hold Down Mortgage Rates

The New York Federal Reserve bought $1.5 billion of mortgage-back securities, something that is supposed to end by late March. The statement reveals that a total of $170.631 billion has now been spent on similar bail-out ventures. The goal is to keep the mortgage rates lower and help the economy.

According to Reuters, dealers submitted "$5.52 billion of agency debt for consideration in the purchase." The N.Y. fed stated by the end of March, $175 billion of "agency securities issued by Fannie Mae (FNM.N) (FNM.P), Freddie Mac (FRE.N) (FRE.P) and the Federal Home Loan Bank system aiming to hold down mortgage rates and revive economic growth."

The housing market is obviously still in a state of recession. Reports on growth and reports on decline force the market values to be inconsistent and unreliable, which furthers consumers' lack of trust in property value.

Some states are fairing better than others, but California for example, is suffering from massive amounts of foreclosures, steep declines in home sales and dramatic drops in home prices.

Programs such as the Home Affordable Modification Program (HAMP) are attempting to halt the growing numbers of foreclosures across the nation. Tax incentives are also being enforced to encourage current or new homeowners to buy new homes. The amount of the tax incentives however, barely cover the cost of agent's commission.

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Written by Amy Munday
Huliq.com