In February, the limit on the size of home loans Fannie Mae and Freddie Mac could guarantee was raised from around $417,000 to as much as $729,750 depending on the market in that area. Theoretically, this would have lowered mortgage rates on jumbo loans. However, 6 months later the market is still the same, stuck. Before the law, the rate for a $500,000 30-year fixed mortgage was 6.73%, now it is almost the same at 6.69%.

Fannie and Freddie buy loans from banks and sell those to investors, which gives the banks more funds to lend to consumers, which maintains home buying afford ability. However, as Fannie and Freddie had a low loan buying threshold of $417K, it got more and more expensive for home buyers to get loans in places where the average market value was at $500K on up. This is why Congress raised Fannie and Freddie´s cap price. In doing this, the difference between the interest rates for buyers with loans below $417K and those up to $730K would narrow as in Feb., the difference was at 1.5%. Unfortunately, while the difference has lessened, it is only because the interest rates are higher for everyone buying under $417K. Those at $417K now have an interest rate at 6.57% and the larger loans at up by 0.12%.

Part of the problem is that publicly the press on Fannie and Freddie is still bad and everyone fears that they will need to be bailed out with taxpayer funds. Less investors want to buy bonds and the higher caps made Fannie and Freddie spread their capital even further. Also, Fannie and Freddie have added new fees, which only increases what borrowers have to pay. Steve Havetz, commented on this occurrence, saying that "Really the way it has translated is that by the time it gets to the borrower they get no real savings,".

There does not seem to hope for the mortgage rates to lower either. Fannie and Freddie have to replenish their capital; hence they have to make more money. Bob Auwaerter, the head of the Vanguard fixed income group, said "There are a lot of moving parts here, and none of them are moving in favor of lower mortgage rates,".