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What the Fed Rate Hike Means to you?

We wish everyone a happy and safe holiday season and thank you for your continued support and referrals, we sincerely appreciate them.

Today, eight years after a devastating recession opened an era of loose U.S. monetary policy, the Federal Reserve raised the Federal Funds Rate (FFR) by 0.25% in a sign that the world’s largest economy has overcome most of the damage done by the global financial crisis.

The FFR is the rate one bank charges another bank to borrower money overnight. Let’s say you want to buy a home, in theory, the less expensive it is for banks to borrower money, the more likely they will lend to consumers at lower rates. Lower mortgage rates translate to greater purchasing power. As the Federal Reserve raises rates gradually, there are four things to keep in mind.

  1. Don’t expect all interest rates to rise immediately, it could take a while for consumers to see a change in rates
  2. If you have an adjustable rate mortgage (ARM), your monthly payment will increase with the increase in the interest rates. If you currently have an ARM loan, you may want to seriously consider refinancing and locking in what are still some of the lowest rates in history.
  3. Payments on your Home Equity Lines (HELOCs) and credit card debt will likely increase as rates move up. You may also want to start paying down these types of debt quickly.
  4. Bank Deposits: There is a silver lining with the rise of interest rates as your savings accounts should also see higher interest rates!  Smaller banks tend to react more swiftly than larger banks and we anticipate they will raise rates on savings accounts to attract new money and retain current deposits.

Give us a call if you are thinking of refinancing or are looking at purchasing a home. We will gladly provide you a no obligation free quote and Pre-Approval letter.

2016 Preview: We anticipate lots of new loan products and enhancements to our current product offerings to accommodate an increase in rates. Stay tuned…

What people are saying…check out our testimonials

Current Conforming Rates (Pmyts based on a average loan amount of $250,000)

Loan Program Monthly Pmyt Rate APR Points
30YF $1,175 3.875% 4.00% 0
20YF $1,482 3.75% 3.99% 0
10YF $2,385 2.75% 3.00% 0
15YF $1,711 2.875% 3.25% 0
5/1 ARM $1,020 2.75% 3.00% 0
7/1 ARM $1,037 2.875% 3.125% 0
10/1 ARM $1,070 3.125% 3.375% 0
FHA 30YF $1,105 3.375% 3.75% 0
FHA 15YF $1,696 2.75% 3.375% 0

Current High Balance Rates – Max Loan Amount $625,500 (Pmyts based on loan amounts of $625,500)

30YF $2,982 3.99% 4.13% 0
15YF $4,395 3.25% 3.50% 0
5/1 ARM $2,637 3.00% 3.38% 0
7/1 ARM $2,722 3.25% 3.50% 0
10/1 ARM $2,765 3.38% 3.63% 0
FHA 30YF $2,896 3.75% 3.99%

Disclosure: These are our current conforming and High Balance rates based on primary residences only, your actual rate could be higher depending on “Risk Factors” such as credit score, LTV, Cash-out, Investment prop, 2nd home, zero cost etc. Please call us for an accurate custom quote including jumbo loans up to $20 million.

The cornerstone of Trulending Mortgage is a fierce commitment to integrity, service and expertise and these core values have, thankfully, resulted in client relationships for life. We appreciate the opportunity to work with you on your next refinance or home purchase transaction. Visit our testimonial section to see what our customers are saying. Please pass this along if you think we can help any of your close friends or family.

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