The government is working hard to make homebuying more affordable for buyers, from Congress working to expand Federal Housing Administration insurance to raising loan buyback limits for Fannie Mae and Freddie Mac. The Federal Reserve has lowered short-term target borrowing rates, which impacts consumer interest rates on credit cards, car loans, and mortgage loans among others. Housing is being widely and unfairly blamed for slowing the economy (the real issue is salaries) until recession has taken over inflation as a national worry. In other words, home buyers are getting what they asked for -- so what are they waiting for?

While mortgage applications have risen modestly on lower mortgage interest rates, many buyers are still being rendered inert by new headlines. "Fed's Bernanke Predicts Further Mortgage Turmoil", posted on MarketWatch , found that "more delinquencies and foreclosures can be expected in the subprime, adjustable-rate mortgage market as borrowers face interest-rate resets," Federal Reserve Chairman Ben Bernanke said Thursday.

To buyers, Bernanke's stance could easily translate as "wait to buy! As more homes come on the market, you could get a better deal!"

Or try this one. "Bush Cites 'Unsettling Times' in Housing Market ", an AP story covering President Bush's most recent speech addressing the economy. "President Bush on Thursday cited "some unsettling times" in the U.S. housing and credit markets as he sought to assure jittery Americans that the economy is holding up well despite worries about a recession" read the opening paragraph of the story. The story goes on to say that Bush was asked "about concerns by some economists that the housing slump and higher mortgage costs could lead to a recession even in spite of action earlier this week by the Federal Reserve to cut short-term interest rates by a half-percentage point." He responded, ""There is no question that there is some unsettling times in the housing market and credits associated with the housing market," the president said. "But he said he didn't see that spreading to the broader economy, wrote the AP.

If you were a homebuyer, would you feel reassured?

Then there's this one: "Fed Rate Cut No Quick Cure For Housing Mess" found on MSNBC . "And while the Fed’s rate cuts may have provided a psychological boost to the markets, many analysts and builders think it will take more cuts -- and more time -- before the housing market recovers," writes Senior producer, John W. Schoen.

"Maybe we should wait for more interest rate cuts," thinks the wily buyer.

It's easy to imagine that many buyers may continue to bench themselves in the hopes that interest rates and housing prices will go down, and they can make a killing.

Buyers will behave that way if they believe that the Fed lowered mortgage interest rates, which is not what happened at all.

"Mortgage interest rates are tied to mortgage backed securities or mortgage bonds," explains David Reed, real estate author and Realty Times contributor. "Not the Fed."

What makes mortgage interest rates go up or down is the prospect of inflation, not lower borrowing costs for banks. If that were true, why are cash advances on credit cards being charged at 28 percent by Chase and other banks?

"We've had a 48-hour window of lower rates, but they're right back where they were two days ago," says Reed. The reason is that when the Fed dropped short-term interest rates 50 basis points, the mortgage industry responded with an 1/8 of a percent cut in mortgage interest rates, but since then, "everybody sobered up and realized that's also a potential for inflation. Money's cheap, people buy more things, and prospects for inflation go up and that leads to higher rates."

While Reed says he believes rates will drift lower on a slower economy, that's not necessarily a good reason for buyers to wait. "Nobody can predict the future."

So here's what you can tell your buyers:

1. Interest rates may not come down at the right time for you.

2. Interest rates are at near-historical lows now. The only thing that will make them go lower is a recession and nobody wants that.

3. Interest rates may not get low enough for you to buy the home you want. If you want to buy, you should buy in a range that you can get with a fixed-rate loan, unless you know you are going to sell within two to five years. If you get an adjustable rate loan, pay extra on the principal with the savings you achieve on the interest rate. That's about $25 for every 1/8 of a point between the adjustable rate and the fixed rate you could have gotten.

4. There's no guarantee that the home you want will be available at the same time as the lowest interest rate is available to you.

5. Interest rates could sink to all-time lows, making you a genius. But that doesn't mean the home you want won't cost more in the meantime.