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URL:  http://boards.fool.com/government-backed-mortgages-could-be-gnmas-or-29247466.aspx

Subject:  Re: Retirement Financial Advisor Date:  4/19/2011  9:22 AM
Author:  Crosenfield Number:  68920 of 76106

Government-backed mortgages could be GNMAs or Fannie May or Freddie Mac. GNMAs are guaranteed by the government as to timely payment of principal and interest. FNMAs are less closely associated with a government guarantee. Your regular broker can probably provide these if you wish. Usually the interest rate you get is about 0.5% above the US treasury yield, which currently is pretty pitiful. Newly issued ones have potentially a 30-year life. Over the last few years, there has been much incentive to refinance mortgages at a lower rate, and when that was done, investors in GNMAs got their money back early. Now as interest rates will rise, mortgages will be refinanced only when people MUST move. There will be no incentive to refinance.

You can also get GNMA funds. They have no maturity date; as one matures or is paid off, the fund manager buys another at whatever the going rate may be. If you want a GNMA fund, simply buy it from Vanguard. You don't have to pay an advisor for that.

What do you want an advisor to do for you?

Best wishes, Chris
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