Will the FED Cut affect consumer interest rates today?

December 12, 2007 | Brian Lebars

With the FED poised to cut the “Fed funds rate” today by a quarter to a half point what does that mean for your interest rate? Historically as a Mortgage Broker my phone will start ringing around 2:30pm after the 2:00pm announcement with clients asking to refinance their current mortgage stating, “Rates went down by a half of a percent today”. This is true to a degree, however, it is untrue that consumer rates went down by the half or quarter spread across the airwaves today.

History of the past two FED rate cuts shows that when the market approves and money comes out of the safety of the 10yr bond and into the stock market driving yields higher intern rising consumer rates. Here is a great article provided by CNBC with a description of how money reacts to FED policy.CNBC

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Filed Under: Mortgage

Tagged: CNBC, FED, Interest Rates, Market, Refinance

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Brian LeBars, Loan Consultant at Vintage Mortgage Group specializes in real estate loans, Jumbo homes loans, FHA loans, FHA 203k, first time home buyer loans, Community down payment assistance programs and Green Mortgage options. Green Mortgage Group is a source for information on real estate, homes, and Bay Area foreclosures and financing options. Green Mortgage Group provides you with all the resources you need to explore purchase and refinance options in the Tri-Valley, East Bay, and San Joaquin counties

Authored by Brian LeBars, Mortgage Broker and top producing Bay Area lender specializing in Refinance loans, Jumbo homes loans, FHA loans, FHA 203k, purchase loans, first time home buyer loans and community first time home buyer down payment assistance programs.