Freddie Mac has recently been in the news due to rising mortgage rates, which have reached their highest levels since late November 2023. This increase in borrowing costs has significantly impacted homebuyers, pushing many to the sidelines during a traditionally busy housing market. Experts predict that mortgage rates will remain above 6%, contributing to a decline in housing affordability across the U.S. and other nations, as highlighted by IMF data. The current economic climate, characterized by soaring yields on government bonds and a strong dollar, has further complicated the housing landscape.
The Federal Home Loan Mortgage Corporation, commonly known as Freddie Mac, is a public government-sponsored enterprise (GSE) established in 1970 to enhance the liquidity and stability of the U.S. housing market. Headquartered in Tysons Corner, Virginia, Freddie Mac plays a crucial role in the mortgage market by purchasing loans from lenders, thereby providing them with capital to issue more mortgages. This process helps to lower borrowing costs for consumers and promotes homeownership. Freddie Mac is also known for its involvement in the secondary mortgage market, where it securitizes loans into mortgage-backed securities.
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As mortgage rates fluctuate, lenders are adjusting their affordability criteria, potentially making homeownership more accessible. Santander has loosened its rules, allowing borrowers to access larger loans. Meanwhile, homeowners are considering refinancing options as interest rates decline, particularly in the UK and UAE.
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Mortgage rates have fallen to their lowest level since October, with the 30-year fixed rate at 6.61%. This decline has spurred a surge in mortgage applications, but concerns about inflation and tariffs may limit the longevity of this trend. Analysts warn of potential volatility ahead.
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As of April 2025, several southern U.S. cities, including Miami, Jacksonville, and New Orleans, are experiencing a shift to a buyers' market due to increased housing inventory and price reductions. This trend is attributed to a combination of high mortgage rates and economic uncertainties affecting buyer confidence.
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As of April 24, 2025, the average rate for a 30-year mortgage has decreased to 6.81%, down from 6.83% last week. This decline follows a period of fluctuating rates influenced by global economic factors, including U.S. Treasury yields and trade tensions. The 15-year fixed-rate mortgage also saw a drop to 5.94%.