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prime rate: FED Rate Cuts: How Low Can They Go? - 01/15/08 01:42 PM
Will Fed Rate Cuts Equal Lower 30 yr. Fixed Rates?
The Federal Reserve will be meeting on Jan. 29th & 30th to discuss the state of our economy.  Will they cut rates and if yes by how much?  Will the rate cuts lead to decreasing or increasing mortgage rates?
There's a lot of confusion about the Fed Funds Rate (FFR) and the typical 30 yr. fixed rate.  Do these rates move in the same direction or are they inversely related? 
First, let me provide a simplistic definition.  The Fed Funds Rate is the rate the Federal Reserve charges other banks for overnight deposits.  It … (2 comments)

prime rate: FED Cuts Federal Funds Rate by .25% - 10/31/07 04:12 PM
Contrary to what you'll be hearing in some of the media outlets, this .25% cut in the funds rates does not equal a .25% cut in long term interest rates.  Yes, it will affect short term rates like the Prime rate (this is the rate a lot of the Home Equity Lines of Credit - HELOC and credit cards are based on) and the LIBOR. 
In fact, since the announcement was made, the Mortgage Bonds are actually showing signs that fixed rates will be rising tomorrow.  Additionally, the expected non-farm jobs report to be released on Friday, 11/2/07 at 8:30 am EST is expected to … (1 comments)

 

Evan Vanderwey, The Cashflow Coach

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