Well, we're just now seeing the reductions in mortgage rates. The mortgage rates are based on the ten-year rate and the Fed controls the overnight or the shorter rates.
Sentiment: POSITIVE
It's appropriate for the Fed to gradually and cautiously increase our overnight interest rate over time.
They flooded liquidity in the marketplace but the mortgage rate is based much more on expectations of inflation. So if the average investor believes that there is inflation coming, they'll move that rate up.
Right now we think that rates will stay low, that you'll be able to get a mortgage below seven percent and that's kicked off a refinance boom that's going to put more money in the pockets of consumers.
We think if the economy remains weak that we could see mortgage rates trail down and we think that we could see rates below seven percent into early next year.
Opt for a fixed-rate rather than an adjustable-rate mortgage.
The Fed's ability to raise and lower short-term interest rates is its primary control over the economy.
We've got to make greedy banks pass on interest rate cuts in full, and we've got to see rents coming down.
It would be helpful if someone would lay out exactly the economic mechanism that gets us from yet lower interest rates to actual economic activity.
Preserving the 30-year prepayable fixed-rate mortgage - it's like the bedrock of the housing system - is critical.
Ignore the annual percentage rate when shopping for a mortgage.
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