Mortgage Rates A Gift For First Time Home Buyers

Now the 30-year mortgage rates drop to record low. This makes sense. Just yesterday the Mortgage Bankers Association informed that the mortgage application have fallen 18.1 percent last week. "The Mortgage Bankers Association (MBA) yesterday released its Weekly Mortgage Applications Survey for the week ending April 24, 2009. The Market Composite Index, a measure of mortgage loan application volume, was 960.6, a decrease of 18.1 percent on a seasonally adjusted basis from 1172.2 one week earlier despite very low mortgage rates. On an unadjusted basis, the Index decreased 17.4 percent compared with the previous week and increased 62.7 percent compared with the same week one year earlier."

The government hopes that the all time low mortgage rates will bring more first time home buyers into the real estate ownership, thus boosting one of the most important sectors of U.S. economy, the housing market. However, the question is, how many first time home buyers will take or are in a position to take advantage of the low mortgage rates. We so above that the application for mortgages are not rising yet.

Time is running out for home buyers looking to purchase their first home and qualify for the $8,000 Federal tax credit. According to the National Association of Home Builders (NAHB) first time home buyers looking to purchase a new home in 2009 and take advantage of the $8,000 first time home buyer tax credit, should do so immediately in order to qualify. The Federal tax credit is contingent upon closing the home sale prior to the November 30th deadline.

How long will the mortgage rates stay this low no one really knows. However, some say the mortgage rates are expected to rise after FED stops buying.

Currently the benchmark 30-year fixed rate mortgage rate is down to 4.78% from last week's 4.80%. A year ago the 30-year mortgage rate was 6.06%, shows the Freddie Mac's weekly mortgage survey.