Lobbyists are trying to get the Treasury Department to consider a proposal to buy mortgage-backed securities from Freddie Mac and Fannie Mae with the hope that this plan will drive the rates down as low as 4.5%. This would enable homeowner’s to refinance their homes at a lower rate, making it easier for investors to get into the housing market.

While lowering the interest rates would entice new buyers and give more money to those who refinance their homes, it offers little help to those homeowners that are facing foreclosure. As the credit standards are so high at the moment, the chance for troubled borrowers to refinance and take advantage of these lower rates is slim to none.

We should know more on this proposal as early as next week.