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Fed Cuts Mean Higher Rates???

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Mortgage and Lending with First Time Home Buyers, Pre-approvals, Fixed Rates 172223

Yep...been know to happen.  And when it does it's a fun one too explain to clients.  If you were to ask, 90% of the people buying or refinancing a home would tell you they assume that when the Fed cuts rates, mortgage rates should drop.  But the fact is the Fed is NOT cutting mortgage rates.  The tendency is that when the Fed makes a move the loan rates generally follow suit, but there have been SEVERAL instances when the Fed cute actually meant HIGHER mortgage rates. 

This is an article from Yahoo Finance, it doesnt do a phenomenal job of putting it in layman's terms, but if you have that curious client that doesnt understand, you may want to share it with them.

http://biz.yahoo.com/usnews/080430/30_what_fed_moves_mean_for_mortgage_rates.html

 If nothing else it does give a list of some of the true indicators that effect mortgage rates. 

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Comments (1)

Abiud "Abi" Montes
EWM Realtors - Fort Lauderdale, FL

Chad thanks for the info. I will check it out. It looks informative.

Thanks again.

May 01, 2008 10:16 AM