Fixed Mortgage Rate Falls to Lowest on Record

This is the goal of the Fed's move to buy $750 billion in mortgage backed securities. The Fed's target is 4.5% or lower for 30 year fixed rate mortgages. I'm going to refinance when the rates hit the Fed's target. Lower mortgage rates is just what the housing market need to stabilze. Remember there is an $8,000 tax credit for first time home buyers this year.-Lou

Fixed Mortgage Rate Falls to Lowest on Record

March 26 (Bloomberg) -- The U.S. 30-year fixed mortgage rate fell to 4.85 percent, the lowest on record, on a government plan to increase purchases of mortgage-backed bonds and buy up to $300 billion of Treasuries.

The average rate is the lowest in the Freddie Mac weekly survey dating back to 1971, the McLean, Virginia-based mortgage buyer said today in a statement. The rate fell from 4.98 percent a week earlier, Freddie Mac said.

The Federal Reserve said March 18 it will purchase up to an additional $750 billion of mortgage-backed securities from Fannie Mae, Freddie Mac and Ginnie Mae to support home lending. The Fed is trying to lower rates by reducing the supply of outstanding mortgage bonds, boosting their price and lowering yields. That would allow banks to reduce the rates on new mortgages and still sell mortgage securities at a profit.

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