I hope that the Federal Reserve's plans to pump liquidity into distressed financial markets will improve the situation of our rather neurotic loan market.
Last week, buyers of a townhouse listing of mine priced interest rates on Monday, and were quoted 5.5% (3 year fixed, then adjustable). On Wednesday, it was 6%; by Friday, 7% was the best that they could do. We negotiated an extra ten days on the close of escrow, hoping that this confusion in the mortgage market would iron itself out in the next couple of weeks.
If the rally in the stock market is any indicator, maybe the banks and investors that buy these "packaged" loans will also be reassured and some degree of normalcy will take place soon.
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