The Obama administration is revealing a brand new program that would help thousands of home buyers by providing support to both local and state housing agencies.
The new program was designed to help support low mortgage rates and to help provide hundreds of thousands of affordable mortgages to low and middle income families.
There are two main features to this program. First, there will be a new bond purchasing program that will support new lending by housing finance agencies and secondly there will be a temporary credit and liquidity program to help improve access by housing agencies to credit sources for their existing bonds.
The Treasury Department, the Federal Housing Finance Agency and the Department of Housing and Urban Development said in a combined news release that this new program will provide temporary support to local housing financing agencies and to further encourage them to return to relying on market sources for their capital.
The local and state housing finance agencies have had a very difficult time raising money to fund loans as a result of the housing crisis and credit crunch.
Treasury Secretary Timothy Geithner said, "This initiative is critical to helping working families maintain access to affordable rental housing and homeownership in tough economic times. Through this initiative, the administration aims to help (the housing finance agencies) jump-start new lending to borrowers who might not otherwise be served and to better support the financing costs of their current programs - key components in stabilizing the housing market overall."