Fannie and Freddie is considering lowering the amount of loans that the can acquire and at the same time according to this Los Angeles Times article about $30 billion in home equity lines dating to 2004 are due for resets next year, $53 billion the following year and a staggering $111 billion in 2018.What that means is that when those dates kicks in for your loan you now have to pay interest like before and plus principal as well. If you have one of these loans it would be a good idea to find out how it will change your payment in the near future.
As with anything that limits the public’s buying power, it will reduce the available cash for those people to purchase other goods and services.
As far as property values, here in Santa Monica, I don’t know, I think the lowering of loan limits may have a bigger impact on values and volume.
Feel free to contact me should you have any questions, or just comment below.
Thank you to Kenneth R. Harney at LA Times for an excellent article.
What that means is that when those dates kicks in for your loan you now have to pay interest like before and plus principal as well. If you have one of these loans it would be a good idea to find out how it will change your payment in the near future.