Mortgage Rates Declined Today

Mortgage rates have declined substantially today for the following reasons:
Investors of Mortgage Backed Securities have been reluctant to purchase FNMA and Freddie Mac securities over the past several months because of reported financial issues with both agencies.
There has always been an implied guaranty by the US Government, however foreign countries, the primary purchases of theses securities, have basically stopped purchasing because they did not feel comfortable with the "implied" guaranty for two agencies that were definitely in financial trouble.
As you know the Federal Reserve lowered their discount rate several times in the hope that mortgage rates would decline. This did not happen because investors were concerned about the credit quality and financial strength of both agencies. Therefore the spread or difference between the ten year treasury and mortgage backed securities widened to historical highs. Without this fear mortgage rates may have been up to a full point lower.
The actions by the Treasury have provided confidence in the agencies and buyers of the agency securities have stepped in dramatically today. As this is written prices have improved, it has brought interest rates below 6% today.
Please be aware there may be an increased level of volatility, ie rapid movements in rates, which typically occur when this types of dramatic changes occur in markets