This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Fed's QE3 Should Soften G-fee's Impact

Gumbinger expects that there could be downward pressure of as much as 25 basis points on rates because of QE3. In case originations slow down to the extent that the Fed controls a larger share of the market, there could be an even bigger impact on rates.

Credit is more of an issue

For the week ending September 28,'s weekly mortgage rates survey found that the average rate on a conforming 30-year fixed-rate mortgage was down to 3.50 percent. As of Monday, October 1, that average fell to 3.41 percent.

But as Gregg Busch, vice president with First Savings Mortgage Corp. in McLean, Va., points out, at this point it is not so much about interest rates as it is about access to lending.

"Until underwriting guidelines loosen up a little bit more, the housing market will just continue slowly and gradually improving," says Busch. "Lenders have tightened up their guidelines considerably. So right now I don't see 3 percent interest rates being any better than 3.5 percent because people just can't get mortgages."

Borrower options

For borrowers who would like to avoid any impact as a result of the upcoming g-fee hike, one option might be to turn to portfolio lenders. These lenders, such as banks that don't sell their loans to Fannie Mae and Freddie Mac, will not be impacted by the g-fee hike. receives compensation from lenders when readers choose to request mortgage quotes. This article is provided by an external partner that is solely responsible for the content.
2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free


Chart of I:DJI
DOW 17,131.86 +47.37 0.28%
S&P 500 2,014.89 +15.91 0.80%
NASDAQ 4,838.6430 +8.1730 0.17%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs