Mortgage rates have fallen again in the last two weeks. Rates for 30-year fixed mortgages declined to 5.92%, down from 6.03% the week before, as stated on the Zillow Mortgage Rate Monitor, compiled by real estate website Zillow.com(R) 15-year fixed mortgages rates decreased to 5.69%, down from 5.76% while 5-1 adjustable rate mortgages rose to 5.87% from 5.85%.

The Zillow Mortgage Rate Monitor is compiled each week using thousands of mortgage rates quoted on Zillow Mortgage Marketplace  www.zillow.com) by mortgage lenders to borrowers who have submitted loan requests. State-level data is gathered for the top 20 states with the highest quote volume on Zillow.

Rates for 30-year fixed mortgages fell even further on Monday evening with the average rate on Zillow Mortgage Marketplace at 5.71%.

At a state level, the 30-year fixed mortgage rate in Pennsylvania saw the biggest decrease, falling from 6.06% to 5.88%. Rates on 30-year fixed mortgages were lowest in the states of Oregon (5.79%) and Georgia (5.81%) and, while Missouri (6.11%) and South Carolina (6.05%) had the highest rates. The table below shows the interest rates for the last 37 years.

There is a plan for the government to partially insure lenders, if they will agree to modify troubled borrowers’ loan terms that could help stabilize housing markets, restore confidence, and bring buyers back into the market.

Federal Deposit Insurance Corp. chairwoman Sheila Bair wants the Bush administration to provide incentives for lenders to do as many as 2.2 million loan modifications.

On Friday the F.D.I.C. unveiled a proposal (see http://www.fdic.gov/consumers/loans/loan…) that the government would pay servicers $1,000 for each loan modified to defray their expenses, and then agree to cover up to 50 percent of losses if a loan should re-default.

If we Assume one in three modified loans will re-default, the plan would cost taxpayers $24.4 billion, but prevent 1.5 million foreclosures by the end of next year, the FDIC said.

The plan and others intended to slow or stop foreclosures could help stabilize housing markets, but "speed is of the essence," said Paul Bishop, managing director of research for the National Association of Realtors.

NAR also wants Congress make credit more easily available to would-be homebuyers. One way to do that, the group says, would be to make permanent the temporary increase in the upper loan limits for Fannie Mae, Freddie Mac and FHA. The limits, boosted in February to $729,750 in high cost areas, are set to come back down to $625,500 on Jan. 1.

NAR has also been adamant that the Bush administration use at least some of the $700 billion earmarked for the Troubled Assets Repurchase Program, or TARP, the way it originally said it would: to buy up "toxic" assets like mortgage backed securities. But after earmarking the first $250 billion in TARP funds to buy shares in troubled banks, the Treasury Department now says it does not plan to buy any mortgage-backed securities.

The FDIC’s foreclosure prevention plan and the buyers incentives and access to mortgage credit advocated by NAR are complimentary in what they aim to accomplish.

Limiting the amount of foreclosures not only slows growth in inventory and slows price declines, but it also provides reassurance to would-be homebuyers who are reluctant to buy into a downturn.

Once that happens, the government must also make sure that buyers who are ready to get off the fence have the financing and incentives needed to make that happen.

First-time homebuyers are key to a recovery, because they are the the least encumbered. They don’t have a existing home to sell, and may be able to get out into the market more quickly than a homeowner who needs to sell a home first

Although the Bush administration was said to be weighing Bair’s plan, last week it rolled out a less ambitious loan modification plan involving Fannie Mae, Freddie Mac and the HOPE NOW alliance of 27 loan servicers (see story) http://www.inman.com/news/2008/11/11/new…).

The administration’s plan, which FHA Commissioner Brian Montgomery said might help "hundreds of thousands of borrowers," involves a streamlined loan modification process in which borrowers’ loan payments would be reduced to 38 percent of gross monthly income by lowering their interest rate, lengthening the term of the loan, or reducing principal and adding it to the back of the loan.

Having placed Fannie Mae and Freddie Mac in receivership, the government has a large say in how they are run. But while Fannie and Freddie own or guarantee about 58 percent of all single-family mortgages, those mortgages represent only 20 percent of serious delinquencies.

About 60 percent of seriously delinquent mortgages have been sold to investors in private-label mortgage-backed securities who may be less willing to engage in loan modifications.

The FDIC said that while foreclosures are costly to lenders, the pace of loan modifications continues to be "extremely slow." Only 4 percent of seriously delinquent loans are modified each month, the FDIC said.

Fannie and Freddie have boosted loan modifications by 60 percent this year, but are still only averaging 4,600 a month. About 92 percent of borrowers Fannie and Freddie have worked with have been able to keep their homes.

Due to falling real estate prices and rising foreclosures on the West Coast, sales of existing homes rose to its highest level in 13 months and highest percentage increase in five years, according to a report released today by the National Association of Realtors (NAR). The increase resulted from buyers responding to improved affordability, the organization stated.

Existing-home sales-including single-family, townhomes, condominiums and co-ops-rose 5.5% to a seasonally adjusted annual rate of 5.18 million units in September from a level of 4.91 million in August, and are 1.4% higher than the 5.11 million-unit pace in September 2007.

Lawrence Yun, NAR chief economist, said more markets are seeing year-over-year gains. “The sales turnaround which began in California several months ago is broadening now to Colorado, Kansas, Minnesota, Missouri and Rhode Island,” he said. “The South was hampered by much lower home sales in Houston in the aftermath of Hurricane Ike.”

NAR President Richard F. Gaylord, a broker with RE/MAX Real Estate Specialists in Long Beach, Calif., said low home prices and low interest rates have been attracting buyers. “This is the first time since November 2005 that home sales have been above year-ago levels,” he said. “Credit tightened at the end of September, but the improvement demonstrates that buyers who’ve been on the sidelines want to get into the market to make a long-term investment in their future.”

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to 6.04% in September from 6.48% in August; the rate was 6.38% in September 2007.

Total housing inventory at the end of September fell 1.6% to 4.27 million existing homes available for sale, which represents a 9.9-month supply² at the current sales pace, down from a 10.6-month supply in August. This marks two consecutive monthly reductions since inventories peaked in July.

The national average existing-home price for all housing types was $191,600 down in setember 9.0% less than a year ago when the median was $210,500. “Compared to a fairly small share of foreclosures or short sales a year ago, distressed sales are currently 35 to 40% of transactions. These are pulling the median price down because many are being sold at reduced prices,” Yun explained. “The current market is not being dominated by speculative investors. Rather, 80% of current buyers are purchasing a primary residence, which is a bit higher than historic norms.”

Single-family home sales increased 6.2% to a seasonally adjusted annual rate of 4.62 million in September from a pace of 4.35 million in August, and are 3.8% above the 4.45 million-unit level a year ago.

Existing condominium and co-op sales were unchanged at a seasonally adjusted annual rate of 560,000 units in September.

Regionally, existing-home sales in the West jumped 16.8% to an annual rate of 1.25 million in September, and are 34.4% higher than September 2007. The median price in the West was $253,600, down 18.5% from a year ago.

In the Midwest, existing-home sales increased 4.4% to an annual pace of 1.19 million in September, but are 2.5% down from a year ago. The average price in the Midwest was $152,500, which is 7.9% lower than September 2007.

Existing-home sales in the South rose 2.2% in September to a pace of 1.90 million but stay 7.8% below September 2007. The average price in the South was $167,200, down 4.1% from a year ago.

Staging is all the rage across America right now. Whether you are selling a home or simply re-decorating, staging has simple principles that most people fail to grasp.

Most people cannot stage their own home. Their sentimental attraction to too many pieces will not allow them to minimize the space. A cute picture of their family together combined with a vase that they got at their wedding, though priceless to them, simply clutters the appearance of the room.

Staging is about clearing a room to show floor space. This means that the furniture needs to be off the wall. When was the last time that you visited a home and found that the couches were off the wall and pictures were on the wall? This is a huge part of staging.

True, staging does not care about groupings of like items. Staging incorporates sizes; the high, medium and low aspect of decorating and uses three or five items in each grouping.

Staging decorates every table for its function as if you are having a party now. Outdoor tables are set for dinner, game tables have games in action and tea sets are ready to go.

Fresh flowers are preferred instead of fake flowers, white towels are used instead of colored by preference, beds have way too many pillows and music is soft or jazzy instead of rock music. Also keep the TVs off.

Staging has played a huge role in getting homes sold quickly and for more money. The goal of staging is to make your home appeal to the broadest range of buyers by eliminating any offensive items or groupings of decorations that would detract a buyer’s attention. You want the buyer instead to be focused on the house and its elements that have attracted them to it.

Staging is a must for serious sellers. Don’t be fooled that you can do it yourself. Hire a professional.