Silicon Valley mortgage brokers could barely contain their enthusiasm as news leaked from Washington of a proposal to reignite the dormant housing market by driving down mortgage rates to the 4.5 percent range.
The plan, which reportedly could be announced as early as next week, has the potential to dramatically boost the housing market and the faltering economy by stimulating stagnant home sales and significantly lowering monthly mortgage payments for millions of Americans.
"It would be a dream come true," said Cathy Warshawsky of Bay Area Loan in San Jose, the president of the Silicon Valley chapter of the California Association of Mortgage Brokers.
At rates of 4.5 percent for a fixed, 30-year loan, "We would have everybody and their brother who had equity in their homes coming to refinance. That would be an amazing influx of loan applications. It would keep things going for a long, long time."
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