Helping Washington State homeowners learn more about their mortgage options.
How are mortgage rates doing after the conflicting jobs data last week?
Will the Fed lower rates on Wednesday? (Spoiler alert – the Fed does not directly control mortgage interest rates).
What’s going on with federal student loans?
And an announcement on our upcoming webinar “Retire Like a Boss” on this week’s episode!
As expected, the Fed has decided to leave the Fed funds rate unchanged, leaving the targeted range between 4.25% and 4.5%. This rate does not directly affect mortgage interest rates, but rather influences the direction of mortgage interest rates (unless you have a home equity line of credit that is based on the prime rate).
What may impact mortgage rates today is the press conference following the Fed rate announcement. Stay tuned!
Happy St. Patrick’s Day!
You don’t need the luck of the Irish to have your own pot of gold! Check out my latest Mortgage Rate Update to learn where rates are trending, what may impact mortgage interest rates this week and where you can find your own pot of gold.
8:15 a.m. Today around 11:00 am PST, we’ll have the decision from the FOMC on whether they are making any adjustments to the federal funds interest rate. Odds are very strong (99.5% per the CME Group) that there will be no change at this meeting. This is what the markets are anticipating. If the Fed surprises us, then markets will react dramatically. The Fed’s actions and market reactions are what may impact mortgage rates today as mortgage rates are based on bonds (mortgage-backed securities). The Fed does not directly control mortgage interest rates.
Following the Fed announcement today, Fed Chair Powell will hold a press conference. What he says (or what the market interprets from his press conference) may also impact the direction of mortgage interest rates. The markets are watching for signs that inflation is cooling (good for mortgage rates) or if inflation is being stubborn (bad for mortgage rates).
Right now, MBS 30 year is pretty flat (down 4 basis points). [Read more…]
Today wraps up the 2-day FOMC meeting which ends with a highly anticipated announcement from the Fed on decisions the Fed Funds rate. It’s important to note that this decision does not directly change mortgage rates. For example, if you hear that the Fed has cut rates by a quarter point or 25 basis points, this does not mean that rates for the 30-year fixed are now a quarter point lower. The action the Fed takes and their commentary or information they release during this meeting does influence the direction of mortgage rates. [Read more…]
This is one of the most highly anticipated “fed days” that I can recall with the expectation that the Fed will lower the funds rate for the first time in four years. The question is, how much will the fed reduce the funds rate? Odds are currently at a 50-basis point drop, which is what the markets are betting on. [Read more…]
In a couple of hours, the FOMC will wrap up their two-day meeting with an announcement on their decision on if they are going to make adjustments to the Fed funds rate. The Fed funds rate does not directly affect mortgage interest rates (except for HELOCs) however, it does influence the direction of mortgage rates. This is because the Fed’s decision is based on the level of inflation. Mortgage rates react negatively to inflation as mortgage rates are based on bonds (mortgage-backed securities/MBS). So, when the Fed raises the funds rate or keeps the rate unchanged due to inflation being too high, mortgage rates tend to move higher. If inflation is in line, we often see mortgage rates improve. [Read more…]
Around 11:00 PST today, the FOMC (Federal Open Market Committee aka The Fed) will wrap up their two-day meeting with an announcement on any adjustments they are making to the federal funds rate. Although the Fed does not directly control mortgage interest rates*, the changes to the funds rate and the Fed’s commentary influences the direction of mortgage interest rates. Mortgage rates are based on bonds (mortgage-backed securities or MBS) and are traded, just like other types of bonds. Markets will react to the Fed’s actions and this will impact mortgage rates. Commentary or signs that inflation is not getting into check will push mortgage rates higher and indications that inflation is taming and that the Fed will lower the funds rate soon will help lower mortgage interest rates. [Read more…]
Rhonda Porter is a Licensed Mortgage Originator MLO121324 living in the greater Seattle area. Rhonda began her career in 1986 in the title and escrow industry and began her mortgage career in 2000. She enjoys helping people understand the mortgage process and started writing The Mortgage Porter in late 2006. Read More…
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