New mortgage rate incentive for home buyers

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By Tami Hoey By Tami Hoey

PHOENIX - If there was ever a time to buy a home, mortgage experts say it's now. This comes on the heels of an announcement by mortgage giants Fannie Mae and Freddie Mac.

Home loans are being offered with down payments as low as 3 percent, under a new program that's largely geared towards first-time home buyers. "We know there's a lot of interest in buying, but having a really high credit score has been a common denominator that we have seen," said Patricia Garcia Duarte with the Neighborhood Housing Services of Phoenix.

The new lending guidelines will enable credit-worthy borrowers who can afford a mortgage, but lack the resources to pay a substantial down payment, get a mortgage with just 3 percent down. "It's a really good move because now people who have the ability to repay their mortgages will be able to borrow," said Garcia Duarte.

The loan must be fixed rate. Experts say it's still not clear how many Valley lenders will sign on to the initiative but added the incentive is certainly there. Meantime, the nation's home ownership rate had sunk to a 19-year low of 64.4 percent in September.