UPDATE: Obama Hails 'Historically Low Interest Rates'

U.S. President Barack Obama Thursday hailed historically low interest rates, which he said could save homeowners who refinance their mortgages about $1,600 a year.

"Rates are as low as they've been since 1971," with the 30-year rate at 4.78%, Obama told reporters. He attributed the decline in part to "extraordinary actions" taken by the Federal Reserve, and in part to actions taken by his administration.

Lower rates are prompting a flood of mortgage refinancings, which rose 88% Obama said.

He noted that federal housing-finance giant Fannie Mae (FNM) refinanced $77 billion of mortgages in March, nearly twice the February amount, and their highest for a single month since 2003.

The President's remarks came as Wells Fargo & Co. (WFC) projected better than expected first-quarter earnings, fueled by $100 billion of mortgage applications, a 64% increase over the prior quarter.

Obama spoke to reporters after meeting homeowners from Washington, D.C. and northern Virginia who recently refinanced their mortgage loans. He estimated the average homeowner could pare hundreds of dollars a month, or an average of $1,600 a year, by refinancing, and urged homeowners who haven't refinanced to consider doing so.

"We hope that everybody takes advantage of it," Obama added. He said between seven to nine million homeowners might qualify to refinance their mortgages at lower rates, putting more money in their pocket each month. He advised those looking to refinance to check out an online government resource, http://www.makinghomeaffordable.gov.

Obama warned homeowners to avoid refinancing scams, saying that if they are asked to pay money up-front before a refinancing, "it's probably a scam."

The President declined to comment on piracy, telling reporters that he wants to keep the focus on the administration's efforts to keep people in their homes.

-By Judith Burns, Dow Jones Newswires; 202-862-6692; [e-mail]

(Tess Stynes contributed to this article.)