The Federal Reserve lowered interest rates this week, which is good news for home buyers and owners. The National Association of Realtors released a statement saying that the lower rates make the dream of homeownership attainable again. “That is the lowest rate in nearly 50 years and will bring buyers back to the market,” NAR President Charles McMillan said. “We are pleased that the government heard our message and responded to our call for action.” Rates had averaged 6.3% in the third quarter, but have now fallen into the 4% range in some parts of the country, making it the lowest rate in nearly 50 years. That has enticed many homeowners to consider refinancing.

According to the Mortgage Bankers Association, mortgage applications rose 2.9% last week. Refinancing made up 76.9% of mortgage activity last week, bringing it to a five-year high. The average rate on a 30-year fixed rate dropped to 5.18% last week. What does that mean as far as potential savings? On a $165,000 loan, the payment would be $906 with current rates, down from over $1000 a month just a month ago.

So how do you know if refinancing is right for you? Try this Mortgage Refinancing Calculator. It will tell you what your new monthly payment will be as well as how much in interest you can save over the course of the loan. That way you will know if refinancing is right for you.

The times may be tight, but that doesn’t mean they have to be tight for you. Finding ways to save just a little money here and there will give you the opportunity to pay off your mortgage or other debts in record time. Just making two extra payments on your mortgage each year will allow you to cut your term by 1/3.

1. Tax Refunds - instead of spending your refund on something frivolous, put that money to work. Use it to make that extra payment (or two) on your mortgage.

2. Groceries - Keep a close record of what you are spending on groceries and work out a plan (using coupons and other techniques) to allow you to cut out $50 a month from your budget. Use your savings to make an extra payment on your mortgage.

3. Luxuries - pass on the manicures, expensive hair cuts or other special treats for just one full year. Use these savings to make a dent in your mortgage term.

4. Entertainment - utilize free and discount opportunities for family fun. Put aside the money that WOULD have been spent eating out, going to the movies and other things and use it to make an extra couple of payments on your mortgage or debt.

The money adds up quickly and the more you pay on your debt the faster it vanishes. The best part is that once the debt is gone then the savings will be available to spend in other (usually more enjoyable) directions.

There was a recent news story about Christians that were allowing homes to go into foreclosure rather than cut out the tithe to make the budget balance. The idea is that it is more important to give to God than it is to pay others what is owed them.

The tithe was set up in the Old Testament as a means of supporting the Levites (who did not work outside of the temple). When Christ came he fulfilled all of the laws. That meant that all the Christians were not obligates to follow the hundreds of rules, regulations and laws set up to guide the Jewish people - the Law was not to live inside each Christian.

Practicing the tithe is a way of training a person to freely give from what God has provided. Ideally the entire Christian world should be living off the 10% and giving the 90%, but I digress. It is important to support the Church and its missions, but a Christian that defaults on his finances will do more harm to the cause than the tithe could ever make up for.

Romans 13:7 is a reminder to ‘Give everyone what you owe him’

Now it is more important than ever for the Christian community to follow through on promises - whether it is a promise to pay a debt or just a promise to help with a school event. Why should the world trust someone who has proven to be untrustworthy?

It was just a few days past that the government declared the answer to the financial crisis was to let the government intervene. After a struggle between the House of Representatives and the Senate, a bill was passed and signed into law.

Apparently, the market did not get the memo. It is still moving along just like it was before the law was passed allowing government to take over some private enterprises. Maybe the market has less faith in the government than the government has in itself.

Since the market hasn’t responded the way the government thinks it should, the government is going to step in it even deeper. The announcement was made that the government is going to use its new found power to buy up eligible notes that (the worth of which is estimated over a trillion dollars). The goal is to start the lending market moving once again.

The concern that tax payers should have is that if private industry doesn’t want to invest in these loans - even at discounted prices - then why should these be considered such a great investment for the taxpayer?

The other day I stopped by my mortgage broker while I was making a deposit at the bank. I was curious to see if we could roll our mortgage over without reviewing our income status. We have recently become self employed and most lenders require two years of records before self employed individuals can secure loans.

It was nice to find out that the bank is still financially secure and still lending money. She said that lending practices had tightened up a bit and that income would have to be proven, so refinancing my loan is out. But what she said was encouraging for others that might be looking at a loan in the near future.

1. Income - you will have to be able to verify your income. Lenders usually prefer tax records from the last few years to establish income, but if you have recently received a raise then a letter from your employer or the last couple of pay stubs may also be acceptable.

2. Credit ratings - pay your bills on time, limit your credit applications and reduce your debts. Lenders are looking for consumers with high credit ratings because this usually will mean a lower risk for the lender.

3. Down payment - expect to put some money down on a home. There were several years when borrowers were getting by with a minimal down payment or NO down payment. Those days are likely gone for good (or at least until lenders forget about the economic woes of these last few months). Start saving today. Put aside the money that you would be paying on your mortgage payment each month. By the time you get ready to purchase your home you should be able to put down 10% or more to secure the purchase.

Lending is tight today but it is still going on. You can help smooth the way for your mortgage process by getting your paperwork together, clearing up your credit and saving for a down payment.