It should have been hailed as good news. Instead, the move by 30 year mortgage rates back below 6% was largely overshadowed by other events:

• In quick succession, the government launched a huge mortgage bailout package and a half-point cut in interest rates, and considered direct intervention in banks.
• None of the above calmed financial markets, as stock market declines actually accelerated upon passage of the mortgage relief bill.
• Even the price of oil came under such pressure that OPEC called an emergency meeting.

So what is a mortgage shopper to do? Take advantage of lower rates, or stay on the sidelines until the world financial turmoil subsides?

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There’s an old saying that it’s an ill wind that blows nobody any good. It applied this week, as the whirlwinds on Wall Street had an unexpected benefit for mortgage shoppers.

• Insurance giant AIG became the latest addition to the string of financial failures, the taxpayer cost of which is rapidly rising
• Leading economic indicators declined by more than expected in August
• Along with a slowing economy, inflation also backed off rapidly in August
• Lower inflation gave interest rates room to fall, so mortgage rates took another impressive step downward over the past week

While mortgage shoppers should not ignore the gathering economic and financial clouds, those lower mortgage rates should remain their primary focus.

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An unexpectedly strong revision of second quarter gross domestic product (GDP) stood out amid an otherwise mixed bag of economic news of interest to home and mortgage shoppers.

In fact, this strong GDP number should be something of a wake-up call, or a call-to-action, for anyone who has been putting off buying a house. It may not pay to delay any further before starting to look for a house and compare mortgage companies.

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Even though stocks have rallied lately on improved economic news, mortgage foreclosures continue to hang like a cloud over the scene.

• An easing in unemployment gains and solid May reports from major retailers were the latest items that suggested the economy was continuing to avoid recession
• On the flipside, a mortgage report for the first quarter of 2008 showed that foreclosures and delinquencies continued to rise
• The foreclosure crisis was given its latest human face when it was reported that celebrity Ed McMahon was struggling to keep his mansion out of foreclosure
• Meanwhile, without fanfare, ten-year Treasuries ended May with a yield above 4.0% for the first time this year — a possible portend of higher mortgage rates to come

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