In Freddie Mac's results of its Primary Mortgage Market Survey the 30-year fixed-rate mortgage (FRM) averaged 6.40 percent with an average 0.6 point for the week ending August 21, 2008, down from the previous week when it averaged 6.47 percent. Last year at this time, the 30-year FRM averaged 6.67 percent.

The 15-year FRM this week averaged 5.93 percent with an average 0.6 point, down from the previous week when it averaged 6.00 percent. A year ago at this time, the 15-year FRM averaged 6.12 percent.

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 6.03 percent, with an average 0.6 point, down from the previous week when it averaged 5.99 percent. A year ago, the 5-year ARM averaged 6.35 percent.

One-year Treasury-indexed ARMs averaged 5.33 percent with an average 0.7 point, up from the previous week when it averaged 5.29 percent. At this time last year, the 1-year ARM averaged 5.84 percent.

"Interest rates for fixed-rate mortgages continue to drift down as reports of economic weakness persist. July's leading economic indicators fell by more than the market consensus and manufacturing slowed in both the Philadelphia and Richmond regions. ARM rates, on the other hand, rose slightly after the Federal Reserve's Open Market Committee hinted it might increase the overnight bank lending rate in its August 5th minutes," said Frank Nothaft, Freddie Mac vice president and chief economist.

However, the housing front is providing some encouraging signs. The pace of home price declines slowed down for the fourth straight month in June and the number of metro areas exhibiting monthly gains rose from seven to nine, according to the S&P/Case-ShillerŪ 20-city composite index. There are also signs more buyers may be getting ready to return to the market. The Conference Board says the share of households planning to buy a home within six months is now at its highest level since March. At the same time, the supply for unsold new homes is down to 10.1 months, the lowest since February, as single-family existing homes (excluding condos and co-ops) start to sell more quickly. Although, when condos and co-ops are included, the resale inventory did edge up."

How to Improve and Maintain Good Credit

Credit is a fickle creature. The smallest change can make it go up and down without warning and can make you the happiest person in the world, or the most disappointed. Why is that? For starters, credit follows you from the moment you start applying for secured or unsecured loans and credit cards or pay bills. Not paying bills or revolving balances on time can keep you from owning a home later down the line. Needless to say, it is very important to keep up with your finances and monitor your credit on a regular basis.

Knowing this, what's on most consumers' minds probably is "how do I improve and maintain good credit?" It can be simple, but the hard part is probably correcting past mistakes. A lot of people get in trouble with credit cards at a young age, mostly college age, and spend a large portion of their twenties trying to raise their credit scores. What should be emphasized to students, even before college, is to beware of credit card debt.

Consumers should only make purchases that can be paid off at the end of the month and pay their bill on time every month. That can increase your credit score dramatically and in a short period of time. Also, balances should never be more than 30 percent of the credit limit. So remember maxing out credit cards can hurt your score and keep you from buying a home in the future.

Another thing consumers can do to improve their score, or maintain a good score, is to pay bills on time. This includes utility bills, medical bills, and cell phone bills. Even if debtors do not report to the three major bureaus (Equifax, Experian, TransUnion), if you don't pay a bill they can send your debt to a collections agency and that can be detrimental to your credit score. Remember, it can take at least seven years to remove a collection from your credit report. This is a negative mark against you when you try to apply for a home loan.

Knowing what's on your report is crucial. Many times credit reports are not correct. According to Loan Toolbox, it is proven that nearly 80 percent of all credit reports contain errors of some kind. Make sure all your accounts are yours and the amounts are correct. If you find a discrepancy or an outdated item, dispute it to the three credit bureaus. They, by law, they must investigate and correct any discrepancies in thirty days. A mistaken debt on your report could be the reason your score isn't as high as it should be.

Existing-Home Sales Hit 5-Month High

Existing-home sales rose in July to the highest level in five months, although they continue to be well below the numbers from last year at this time, according to the National Association of REALTORSŪ.

Existing-home sales – including single-family, townhomes, condominiums and co-ops – increased 3.1 percent in July to a seasonally adjusted annual rate of 5 million units from a downwardly revised level of 4.85 million in June. Sales were 13.2 percent lower than the 5.76 million-unit pace in July 2007.

NAR President Richard F. Gaylord, said the up-and-down pattern may break soon.

"We hope the new tools in the hands of home buyers from the recently enacted housing stimulus package will spark a sustained sales uptrend in the months ahead," he said. "Buyers who've been on the sidelines should take a closer look at what's available to them now in terms of financing and incentives. Given some of the inventory on the market, we also strongly encourage buyers to get a professional home inspection."

Avoid Surprises: Know Your Homeowner's Coverage

Most of us sign up for a homeowner's insurance policy when we purchase a home not only because of the protection it offers us, but also because of the "required reading" aspect of it to our mortgage lender. Those institutions lending us the money to make homeownership possible cover their bases by making sure their own financial investments are protected in case of fire or natural disasters. But how much does the average homeowner know about what the typical homeowner's policy covers?

The typical homeowner's policy includes coverage for perils and losses due to fire, lightning, tornadoes, windstorms, hail, explosions, smoke, vandalism and theft. Those owning homes in coastal areas may want to pay special attention to the restrictions their coverage places on wind damage protection, however.

Just as you would scrutinize the terms of your medical insurance, the nuances and details of your homeowner's policy should be examined seriously. Too often, homeowners sign up for a policy and go on autopilot regarding its terms and coverage without taking new acquisitions, risks, and increasing value of their homes into consideration.