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What’s with the Fed and Rates?

fed-ratesHave you heard references to the Federal Reserve or “the Fed” in the news? These reports usually pertain to the Fed’s raising or lowering of interest rates. The impacts of a rate decision can vary. Here are a few things to remember:

  • The Fed sets target rates for bank-to-bank and Fed-to-bank loans.
  • The Fed does not directly control fixed mortgage rates. In fact, fixed mortgage rates can change well in advance as the market anticipates any adjustments.
  • The prime rate is directly influenced by Fed moves. This rate is often used as the benchmark for interest charged on credit cards, auto loans and Home Equity Lines of Credit (HELOCs).

There’s talk that the Fed may raise rates before the end of the year. That may make this a good time to “lock in” a low rate on a purchase if you’re so inclined. Existing owners may want to consider refinancing or combining adjustable rate loans like HELOCs or even consumer debt into one low fixed rate. Consolidating debt is not for everyone, but we’re happy to arm you with information as you decide what’s right for you.

Please let us know how we can help; please contact us.

Sounding like a broken record can be a good thing

It’s a refrain we’ve been repeating a lot lately, yet it’s one we like to hear: Home values are still rising in most places, and mortgage rates are still near historic lows.

So why do we keep talking about it? Low rates can equate to saving money, and rising prices can equal growing wealth. That’s music to the ears of homeowners and home buyers far and wide.

How much have values risen? The map below will show you home price growth in the last quarter of 2015. Annual growth is detailed in the chart. Pretty impressive, isn’t it?

2015 Q4 Update on Housing Market by State Wisconsin California and Tennessee

The appreciation figures shown are derived from the Federal Housing Finance Agency (FHFA) All Transactions Data and compiled by Estate of Mind, Inc. Appreciation will vary from year to year, can decline and, for any individual property, can be more or less than the averages illustrated here. Information is deemed accurate but not warranted.

While the message of rising values and low rates may sound like a broken record, it’s one we’re happy to repeat.

Why? There may still be opportunities for owners to save or even free up some cash for other needs. With rates where they are, affordability is still good for prospective borrowers, too.

Still, we don’t know how long the current trends will last. If it’s time for you or someone you know to take the first step toward buying or refinancing, we’re ready to help.

Just be sure to take action before the music stops. Contact me today.