Fed Raises Funds Rate a Half Point

Today wrapped up the two-day FOMC meeting and Chairman Powell announced that the funds rate will be increased by a half point. As of today, the federal funds rate is 0.75-1% and is expected to another 2 percent by the end of the year.

From the FOMC statement:

“…the Committee decided to raise the target range for the federal funds rate to 1/4 to 1/2 percent and anticipates that ongoing increases in the target range will be appropriate. In addition, the Committee expects to begin reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities at a coming meeting.”

The Fed also reiterated their plan to continue weening back supporting lower mortgage interest rates.

Mortgage rates reacted favorably to this news. You can see on the chart that around 11:30 PST, the light blue spikes higher – this is indicating an improvement to mortgage-backed securities (which mortgage interest rates are based on). The reason for the improvement to mortgage rates while the Fed funds rate was moved higher is that this increase to the Fed Funds rate was highly anticipated.

So… what does the 0.500% increase to the Fed Funds rate mean to you?

If you have credit cards or a home equity line of credit or any other debts where the interest rate is based on the prime rate, your rates probably just went up a half point. And they probably will again when the Fed wraps up their June 15th meeting.

Although we had this nice improvement to rates today, mortgage rates are likely to continue to trend higher with the Fed continuing to pull back on their support and let’s not forget inflation, which also drives mortgages higher as bonds (like mortgage-backed securities) react negatively to inflation.

If you have a home equity line of credit or credit card debt, you may want to look at doing a cash-out refinance depending on what your personal scenario is.

If you are considering a home purchase, refinance or second mortgage for a home located anywhere in Washington state, I’m happy to help you!

A Hopeful Sign for Homebuyers

This has been one of the most challenging markets for homebuyers that I have seen in my 20+ years as a mortgage professional in the greater Seattle area. The lack of inventory has created a frenzy allowing sellers to name their extraordinary price with bidding wars leaving many buyers exhausted and warn out from this highly competitive market. [Read more…]

Freddie Mac’s PMMS Report Illustrates Rising Mortgage Rates

Every Thursday, Freddie Mac releases the Prime Mortgage Market Survey which shows average rates from last week (this data is not current for today since it’s an average of last week’s applications). The survey is based on purchase applications with at least 20% down payment with excellent credit. So if you’re doing a cash-out refi, have less than stellar credit or have a higher loan to value, your rates would most-likely be higher than what’s shown on the survey.

UPDATE: Rates shown below are not current. Please click here for a mortgage rate quote based on your personal financial scenario for your home located in Washington state.
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Mortgage Rates Dramatically Increase

Today mortgage rates jumped about 0.25-0.375 in interest rate or about a full point (1% of the loan amount) in fee. Mortgage rates have been trending higher since the beginning of this year. Today’s movement with mortgage rates is a pretty significant increase for one day.

The is largely due to Federal Reserve Governor Brainard stating today that they are going to start rapidly liquidating their balance sheets as well as being more aggressive with increasing the federal funds rate. Combine this with inflation and mortgage rates will continue to push higher. [Read more…]

Home Equity Loans and Second Mortgages

Home equity lines of credit (often referred to as HELOCs) and fixed rate second mortgages are available again at Mortgage Master Service Corporation.

You can use a home equity loan or fixed-rate second mortgage to access home equity without doing a cash-out refinance of your first mortgage. This may be really desirable considering the appreciation of homes and recent low mortgage rate environment. Click here for current mortgage rates for your Washington state home.

Here are some of the features: [Read more…]

Mortgage Rates Improve

Freddie Mac’s PMMS report released today shows that the average mortgage rates improved last week. EDITORS NOTE: these rates are OLD NEWS! If you would like current mortgage interest rates for your home, please click here.


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Refinancing to Cash Out your Ex-Spouse

If you’re a homeowner who is going through a divorce or a dissolution of domestic partnership, there are some things to know about using the equity from your home to “cash out” your ex-spouse.

When someone uses a refinance to take equity out of home to provide to ex-spouse, lenders will make an exception and treat the transaction as a “limited cash-out” refinance instead of “cash out” refinance. This provides slightly better pricing with the interest rate and may allow for a higher loan amount, if needed. [Read more…]

Mortgage Rates on the Rise

Mortgage interest rates have been pushing higher with the Fed pulling out of buying mortgage-backed securities and inflation. Check out Freddie Mac’s latest Prime Mortgage Market Survey that was published this morning. NOTE: Rates posted below are EXPIRED – for current mortgage rates based on your personal scenario for homes located in Washington state, please click here.

[Read more…]