Your name saw this post on The ActiveRain Real Estate Network and thought it might be of interest to you. Please see the link below to review the post.

Federal Funds Rate Drop v.s. 30 Year Fixed Rate Mortgages
One of the biggest misconceptions in the mortgage and Real Estate industries is the fact that the when the Federal Funds Rate is dropped that it also means there will be a corresponding rate drop in 30 year fixed rate mortgages. People wake up - It does NOT! In fact many times the exact opposite occurs.
I can't even tell you the number of times I have been hearing lately people making the comment "Hey the Fed is thinking of dropping the rates again...Mortgage rates should be heading down". What can be even more shocking is when Realtors don't realize how things work either! A good Real Estate agent should have at least a basic understanding of how the mortgage market works - Many do not!
The underlying belief is that lower 30 year fixed rates stimulate sales. This of course is true but there is a disconnect between this happening when the government cuts the Federal Funds Rate.
Since January the Federal Funds Rate has been cut a number of times. In January of 2008, 30 year fixed rate mortgages stood at around 5.5%. In March they have been moving around between 6.25% and 6.5%. So since January when the Federal Funds Rate was cut ... more

__________________________________________________
Are you on The Rain? Grow Your Network!