Comments on: How will the Fed’s rate cut affect my mortgage rate? http://www.mortgage--loans--blog.com/mortgage-loans/how-will-the-feds-rate-cut-affect-my-mortgage-rate A blog on mortgage loans Sun, 20 May 2012 12:35:35 +0000 http://wordpress.org/?v=2.7 hourly 1 By: did_di http://www.mortgage--loans--blog.com/mortgage-loans/how-will-the-feds-rate-cut-affect-my-mortgage-rate/comment-page-1#comment-928 did_di Sat, 21 Mar 2009 22:03:46 +0000 http://mortgage--loans--blog.com/mortgage-loans/how-will-the-feds-rate-cut-affect-my-mortgage-rate/#comment-928 <a href="">Pamela</a> ARM's by definition move with interest indexes (and the Fed's bench mark interest rate affects these indexes greately). Today the rate was cut by .5% and what that means is that the ARM portion of your monthly mortgage payment should go down in the short to mid-term. But there is no garantee for the future! And that's why you're getting a better deal today compared to say a 30 year fixed, you're sharing the risk along with your credit union... Now for the 17% ballon, I hope that you have a plan to pay it when it's due in 5 years. Otherwise, you might be forced to refinance if you have that option or else... Well I guess you heard the news like the rest of us... If I was you, I would make sure that the worse case senario is considered so you don't end up loosing your home like 45,000 People in Atlanta this year... Pamela

ARM’s by definition move with interest indexes (and the Fed’s bench mark interest rate affects these indexes greately). Today the rate was cut by .5% and what that means is that the ARM portion of your monthly mortgage payment should go down in the short to mid-term. But there is no garantee for the future! And that’s why you’re getting a better deal today compared to say a 30 year fixed, you’re sharing the risk along with your credit union…

Now for the 17% ballon, I hope that you have a plan to pay it when it’s due in 5 years. Otherwise, you might be forced to refinance if you have that option or else… Well I guess you heard the news like the rest of us… If I was you, I would make sure that the worse case senario is considered so you don’t end up loosing your home like 45,000 People in Atlanta this year…

]]> By: Zac http://www.mortgage--loans--blog.com/mortgage-loans/how-will-the-feds-rate-cut-affect-my-mortgage-rate/comment-page-1#comment-927 Zac Fri, 20 Mar 2009 08:35:39 +0000 http://mortgage--loans--blog.com/mortgage-loans/how-will-the-feds-rate-cut-affect-my-mortgage-rate/#comment-927 <a href="">Charlie</a> if the fed funds rate is lowered the mtg industry should see a quick effect but probably not in a weeks time Charlie

if the fed funds rate is lowered the mtg industry should see a quick effect but probably not in a weeks time

]]> By: Rick K http://www.mortgage--loans--blog.com/mortgage-loans/how-will-the-feds-rate-cut-affect-my-mortgage-rate/comment-page-1#comment-926 Rick K Thu, 19 Mar 2009 16:51:26 +0000 http://mortgage--loans--blog.com/mortgage-loans/how-will-the-feds-rate-cut-affect-my-mortgage-rate/#comment-926 <a href="">Tom</a> probably wont make that much difference but make sure you are ready to refi in 5 years Tom

probably wont make that much difference but make sure you are ready to refi in 5 years

]]> By: hoohawheehaw http://www.mortgage--loans--blog.com/mortgage-loans/how-will-the-feds-rate-cut-affect-my-mortgage-rate/comment-page-1#comment-925 hoohawheehaw Wed, 18 Mar 2009 04:07:38 +0000 http://mortgage--loans--blog.com/mortgage-loans/how-will-the-feds-rate-cut-affect-my-mortgage-rate/#comment-925 <a href="">Terry</a> Adjustable rates look real nice...now...(it's kind of like bait and switch) Terry

Adjustable rates look real nice…now…(it’s kind of like bait and switch)

]]> By: Andrew Wiggin http://www.mortgage--loans--blog.com/mortgage-loans/how-will-the-feds-rate-cut-affect-my-mortgage-rate/comment-page-1#comment-924 Andrew Wiggin Sun, 15 Mar 2009 18:47:21 +0000 http://mortgage--loans--blog.com/mortgage-loans/how-will-the-feds-rate-cut-affect-my-mortgage-rate/#comment-924 <a href="">Corey</a> It will have no immediate effect and probably no long term affect. Corey

It will have no immediate effect and probably no long term affect.

]]> By: Adam L http://www.mortgage--loans--blog.com/mortgage-loans/how-will-the-feds-rate-cut-affect-my-mortgage-rate/comment-page-1#comment-923 Adam L Sun, 15 Mar 2009 10:49:31 +0000 http://mortgage--loans--blog.com/mortgage-loans/how-will-the-feds-rate-cut-affect-my-mortgage-rate/#comment-923 <a href="">Shawn</a> Most likely it won't. The Fed rate isn't strongly correlated to mortgage rates. Mortgages are more strongly correlated to T-bill rates, such as the 1-year T-sec. These go up and down depending upon how much money the govt. lends and how many people want to buy our bonds. It's determined more by China and Saudi Arabia than the fed. The reason for the strong correlation is that mortgages 'compete' with T-bills for money. Both are long-term, relatively safe places to earn some interest income. -->Adam Shawn

Most likely it won’t. The Fed rate isn’t strongly correlated to mortgage rates.

Mortgages are more strongly correlated to T-bill rates, such as the 1-year T-sec. These go up and down depending upon how much money the govt. lends and how many people want to buy our bonds. It’s determined more by China and Saudi Arabia than the fed. The reason for the strong correlation is that mortgages ‘compete’ with T-bills for money. Both are long-term, relatively safe places to earn some interest income.

–>Adam

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