Posts Tagged ‘Rates’

The Federal Reserve recently announced that it intended to keep “interest rates” low through at least mid-2013. This unprecedented statement shocked the markets and helped drive mortgage rates down to match historic lows. As investors digested this information, many concluded the Fed is essentially stating that they believe our economic growth will remain stagnant for some time. Although the markets appreciated the transparency of the Fed’s statement and assurance that lending rates will remain low, it was a sharp contrast to prior predictions that our economy would be at a healthy growth rate by the end of 2011. The acknowledgement that our economic recovery has been “significantly slower” in the first half of 2011 than previously expected was more in line with what many on “Main Street” have been saying all along.

How Will this Decision Impact Mortgage Rates?

There are two interest rates that are controlled by the Federal Reserve – the Fed Funds Rate (a lending rate at which banks with deposits at the Federal Reserve lend money to other banks overnight) and the Discount Rate (the interest rate that an eligible depository institution is charged to borrow short-term funds directly from a Federal Reserve Bank). Both of these are very different from mortgage rates. A mortgage rate can be in effect for 30 years while a rate set by the Fed can change from one day to another. Therefore, this recent statement by the Fed does not guarantee that mortgage rates will stay in current ranges until mid-2013, only that it is likely short term rates will remain at current levels for the next two years (home equity rates, car loan rates, credit card rates, etc.).

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City Creek Staff,

Thanks for all your work in financing our new home. I know it takes a bit more work and effort to get financing for the self-employed and we are happy that you stuck with us. We love the house, the area and all about it. Here are some gift certificates for our company, Envision Cosmetic Surgery. Please feel free to use them as you wish. Love to see you soon.

Benjamin and Nalene Dunkley

Envision Cosmetic Surgery

Congratulations to Lori Kotter for winning our weekly Facebook contest. Lori won Dinner, Dessert, Movies and Popcorn. You can enter to win all of our fun prizes by going to www.facebook.com/citycreekmortgagecorp and liking our page. Good Luck!!!

Pay off the account with the smallest balance first regardless of interest rate. As each account is paid off, apply those payments to the account with the next smallest balance, and so forth. Watch your debt begin to disappear. This is one of the most liberating experiences my clients have. Is it time for you to snowball your debt? Call me if I can help!

Now I stumbled upon this video courtesy of our friends at Think Big Work Small. They took a clip from a hearing on Capitol Hill with Federal Reserve Chief Ben Bernanke. We’ve taken the liberty to post this video here, to show you that Knowledge is Key in any industry, but especially ours. You’ll clearly see that the Representative that is challenging Mr. Bernanke has no knowledge of what rates affect what. The scary part is that these Representatives are representing you and I. Now we know that many don’t know the difference between the Federal Funds Rate and the Discount Rate, but when you are at the highest levels of our government, you’d hope that they would have acquired that knowledge. Enjoy the Video! (Remember to turn the volume up just a bit.)