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Refinance Your Mortgage
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How Mortgage Rates Are Affected By Market Conditions
You might find it interesting to know that supply and demand play a significant role in interest rates. When the economy is high and borrowing is strong, interest rates go up. When the economy is low and there is less borrowing, interest rates go down. Interest rates can also be influenced by what the Federal Reserve does and where the fed funds rate is set.
You might find it interesting to know that supply and demand play a significant role in interest rates. When the economy is high and borrowing is strong, interest rates go up. When the economy is low and there is less borrowing, interest rates go down. Interest rates can also be influenced by what the Federal Reserve does and where the fed funds rate is set.
Fed Funds Rate
At every Federal Reserve meeting, the Fed Funds Rate has the ability to change. When they raise interest rates, mortgage rates for home equity loans and adjustable rate mortgages can also go up. Although it's nearly impossible to predict what the U.S. Economy will do and if rates will change, it's very important to understand some of these market dynamics because not knowing may wind up costing you money.
At every Federal Reserve meeting, the Fed Funds Rate has the ability to change. When they raise interest rates, mortgage rates for home equity loans and adjustable rate mortgages can also go up. Although it's nearly impossible to predict what the U.S. Economy will do and if rates will change, it's very important to understand some of these market dynamics because not knowing may wind up costing you money.
Short Term Rates
The Fed Funds Rate is the interest rate charged when banks lend funds to one another. This is what is known as a short term rate, or a rate that is two years or less in maturity. When the short term interest rates fall, spending and borrowing usually increases. This can also cause inflation. Home equity and adjustable rates can also be affected by short term rates. When the Federal Open Market Committee raises or lowers the Fed Funds Rate, it affects mortgage rates that are tied to the short term interest rates.
The Fed Funds Rate is the interest rate charged when banks lend funds to one another. This is what is known as a short term rate, or a rate that is two years or less in maturity. When the short term interest rates fall, spending and borrowing usually increases. This can also cause inflation. Home equity and adjustable rates can also be affected by short term rates. When the Federal Open Market Committee raises or lowers the Fed Funds Rate, it affects mortgage rates that are tied to the short term interest rates.
Long Term Interest Rates
Long term interest rates are rates that are 10 years or more in maturity. Our 15 to 30 year fixed rate mortgages are affected by long term interest rates. The long term interest rates are not directly influenced by the short term interest rates but are still indirectly affected. When the Fed raises short term interest rates many people with adjustable rates start to refinance, increasing the demand and can increase the long term interest rates.
Long term interest rates are rates that are 10 years or more in maturity. Our 15 to 30 year fixed rate mortgages are affected by long term interest rates. The long term interest rates are not directly influenced by the short term interest rates but are still indirectly affected. When the Fed raises short term interest rates many people with adjustable rates start to refinance, increasing the demand and can increase the long term interest rates.
Testimonial |
We have refinanced 2 times with them and both times lowered our payment!! |
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James and Jaclyn M
(Brunswick, OH)
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