So…Be prepared to pay a little more for conforming mortgages in the coming weeks and months. Fannie Mae and Freddie Mac have decided to increase their fees to lenders in response to the massive losses they have posted over the past few weeks. So what does this mean for you, the consumer?

It means that not only have tighter mortgage regulations been put into place – i.e. higher credit scores required for the most competitive of interest rates – but that risk evaluation has become a much bigger part of the decision process, and borrowers are being scrutinized like never before – making FICO scores a larger part of the underwriting/decision process.

Gone are most of the higher LTV (Loan to Value) mortgage options – with the exception of FHA. The ability to not provide documentation of income or assets with higher LTV’s has also disappeared. Borrower ability and the scrutiny of that ability are what the mortgage market is all

I was recently contacted by one of my blog readers with a great question. Why is it that certain areas in Raleigh seem to be doing quite well, even though we constantly are hearing and reading about the declining national housing market?

Well, as many of you are aware, when discussing Real Estate one must focus on the true local aspect of the property – not just same region or town – but sometimes the actual street can mean a big difference. The main reason for that is simply price point. Obviously in a tighter housing market, there will be certain segments of the market – for reasons known and unknown – that will sell at a faster or slower pace. The Raleigh market has been rated nationally as one of the better markets in the country for growth – this due to strong infrastructure of education, local government, diverse business climate etc.

Certain neighborhoods may be located near a strong business and may be priced just right for those

The US Senate passed H.R. 3221 (also known as The Housing and Economic Recovery Act of 2008) this morning 72-13 in a rare Saturday session. The legislation now moves to the desk of President Bush, where it’s expected that he will sign the bill sometime this week as an added show of confidence for the nation’s housing and mortgage markets.

This is an historic piece of legislation and it helps not only consumers, but the housing and mortgage industries alike…

Here are a few of the highlights of the Act in its current state...

• Raises FHA loan limits to the lesser of 115 percent of the local area median home price or $625,500 (up from $362,790).

• Authorizes $300 billion in loan guarantees through fiscal year 2011 for a voluntary program to help at-risk borrowers refinance into viable mortgages.

• Permanently increases cap on mortgage loans Fannie Mae and Freddie Mac can purchase (“conforming loan limit”)

This past week was quite the roller coaster ride for the GSE’s (Government Sponsored Enterprises) – Fannie Mae and Freddie Mac. As all of us in the industry knew that there was never a doubt as to whether the Federal Reserve would step in to bail out the GSE’s - but national media certainly tried to spook the consumer. All at a time when consumer confidence remains at record low levels.

While the internals of the GSE’s may be ripe for a change – and due for a change – the outcome as to how it influences main street with respect to mortgage origination is minimal at best. So what does this mean to us here in the triangle housing market? Really nothing at this point.

However, expect to see more transparency at the corporate level for Fannie and Freddie – even making them potentially part of the Fed at some point. Given the fact that Fannie and Freddie ARE the irrigation system and fertilizer for the housing market –

As if Consumer Confidence hasn’t already been hit hard enough, the GSE (Government Sponsored Entities) stock price story this morning should really impact consumers across the board. The two main purchasers of home mortgages in the US had their stock prices hit hard today on concerns that liquidity is becoming a problem for even the most stable of entities.

Wow – if Fannie Mae and Freddie Mac are having perceived issues, then who is safe these days in the housing market? Not only is consumer confidence at risk, but institutional confidence is at risk as well – the true foundation of the capital markets and housing industry.

The good news is that the Federal Reserve will not stand by and let the GSE’s fail or be put under intense pressure for any period of time. Systemic risk aversion is of the highest priority right now – for both industry leaders and consumers alike… but it’s important to realize that we must all be