LIBORATION:

Unanticipated relief for anxious homeowners: Adjustable rates could go down (Jenifer B. McKim, January 10, 2009, Boston Globe)

Homeowners in fear that payments on their adjustable-rate mortgages will shoot up this year can relax. Their monthly costs will probably be the about the same, or even less, because interest rates have fallen to historic lows.

Nearly 17,000 borrowers in Massachusetts are among those across the country whose adjustable mortgages reset this year. But falling rates mean many who were worried about a crunch will now enjoy unanticipated savings. And others will see the specter of foreclosure ease, because their loans may not rise to unaffordable levels.

All this is good news for borrowers and for the economy.

"Being able to free up cash flow for folks will have a substantial positive effect on the economy," said Christopher Foote, a senior economist at the Federal Reserve Bank of Boston.

Thankfully the House GOP was beaten down.

Posted by Orrin Judd at January 10, 2009 9:19 AM