U.S. mortgage rates fell Wednesday, boosting government efforts to bring mortgage rates down to levels that will spur demand and help the hard-hit housing market begin to recover.

Interest rates on 30-year fixed-rate mortgages fell more than 0.40 percentage points to 4.79 percent, according to the Zillow Mortgage Rate Monitor, compiled by real estate Web site Zillow.com.

The sharp drop came after the Federal Reserve on Wednesday said it would more than double its planned purchases of mortgage-related securities.

The Federal Reserve said it would buy long-term Treasuries as well as more mortgage-related securities as part of its ongoing efforts to bring mortgage rates down to stimulate borrowing in order boost the U.S. housing market, which is currently in the throes of the worst downturn since the Great Depression.

The Fed said it would buy an additional $750 billion of agency mortgage-backed securities, bringing total purchases to up to $1.25 trillion this year, as well as double its potential purchases of agency debt securities to up to $200 billion.

Thirty-year mortgage rates had mostly been on a downward trend since the Federal Reserve unveiled a plan in late November.

In the original plan, the Federal Reserve said it would buy as much as $500 billion of mortgage securities backed by Fannie Mae , Freddie Mac and Ginnie Mae, and entailed buying up to $100 billion of debt issued by Fannie Mae, Freddie Mac and the Federal Home Loan Banks.

According to the Zillow Mortgage Rate Monitor, in the week ended March 15, mortgage rates for 30-year fixed mortgages fell for the first time in a month, down to 5.21 percent from 5.28 percent the week prior.

The battered U.S. housing market is both the source and a major casualty of the credit crisis. (Reuters)