Mortgage Rates: Drops Trigger Strong Activity

Tumbling interest rates are setting off a mortgage-refinancing scramble among homeowners and pulling undecided buyers into the market.

Applications are up in part because of a federal refinancing program through Freddie Mac and Fannie Mae that is part of the Obama administration’s housing rescue plan.

Rates have been driven down by the Federal Reserve’s decision to buy up to $300 billion of long-term government bonds and $750 billion in mortgage-backed securities held by Fannie and Freddie.

Homeowners who had been waiting to refinance say they’re now getting great deals.

Low prices on foreclosed homes are luring buyers into the market. Up to 45% of existing home sales in February were distressed properties, according to a report by National Association of Realtors.

What about you? Are you thinking of refinancing (if you’re already in a home) or buying a home now, due to record low interest rates? We’d love to hear from you. Click the comment link below and sound off. Your email address will never be published here.