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WASHINGTON, April 9 (Reuters) - Interest rates on typical home loans will continue to fall from their current, record lows, the top U.S. housing official said on Thursday.
“I think you will see them continue to come down, based on everything that we’re doing, but recognize that they’ve already started to make a big difference,” Housing and Urban Development Secretary Shawn Donovan said on CNBC.
Donovan was speaking after a White House press event where President Barack Obama touted his plans to rescue the housing market.
Mortgage rates climbed from record lows in the past week and settled at 4.87 percent for a 30-year loan, said mortgage finance company Freddie Mac. A year ago, the rate was 5.88 percent and officials hope that drop will coax more prospective buyers into the market.
In late February, the White House announced a plan to help 9 million homeowners win lower mortgage rates or lower their monthly bills to a more affordable level.
“Home purchases are up about 20 percent since we announced the plan so we are already beginning to see a difference,” Donovan said.
Still, most of the program is still on ice as officials work through the details and try to win concessions from the mortgage investors who now hold many troubled loans. (Reporting by Patrick Rucker; Additional reporting by Lynn Adler in New York)