Home buyers rush in as mortgage rates fall
November 28, 2008
November 28 2008 - Telephones are ringing — and ringing — at mortgage brokers’ offices around the country after this week’s sharp drop in mortgage rates.
Average rates on 30-year fixed-rate mortgages fell to 5.97%, down from 6.33% the week before, according to Bankrate.com. Some brokers report rates as low as 5.25%.
Borrowers with a $200,000 loan, for example, would save about $63 a month if their interest rate dropped to 5.5% from 6%.
Credit the Federal Reserve’s announcement this week that it will buy $500 billion in mortgage-backed securities held by Fannie Mae and Freddie Mac, helping the two mortgage-finance giants increase the pool of money available to banks and other lenders to make new mortgages.
