FED Cut and Lower Orlando Interest Rates

Do they go to a special school to ‘speak FED’???  Good Lord, fellas… we gotta be able to understand this stuff to be able to respond appropriately… or is that not what you want? LMAO

Well, the Federal Open Market Committee voted to cut the Fed Funds Rate by .5% today. The benchmark rate now stands at 1.0%.  THIS DOES NOT LOWER MORTGAGE RATES

In its press release, the Fed got busy addressing the main issue at-hand, stating that economic activity has “slowed markedly”.  Ha… ‘markedly’… have you ever used that word in your life?  Well, my readers are notably smarter than I am, so you probably have!  Anyway, they pointed to three main causes:

1. Consumer spending…

Read the whole Blog post at THE Orlando Real Estate and Mortgage Chili Blog:

FED Cut and Lower Orlando Interest Rates

The FED rate cut and… okay, I’ll say it… apocalypse

Sooooo, [I thought i would start with something other than ‘okay…’ LOL] The FED made an “emergency rate cut” yesterday, dropping the Fed Funds Rate by one half-percent to 1.500%. What you care about, is the PRIME rate dropped to 4.500%… this is what HELOCs and credit card rates are based on… yeah I know… good news, right? I mean, the move is meant to stimulate the U.S. economy… isn’t it?

When the Federal Reserve changes the Fed Funds Rate, it often takes 9 months for the changes to work their way through the economy so this is not an immediate realization of change, but apparently the FED felt it had to do it and do it quick. Emergency meetings are relatively rare.

On a broad scale, therefore, we won’t know if the cut truly “worked” until thew summer of next year.

But, as it relates to ‘we the people’ in general, the rate cut spurred two instantaneous changes.

1. Credit cards and HELOCs will be more affordable as I stated before,
2. but the second change is that mortgage rates are rising.

The Fed’s moves have sparked optimism in some corners of Wall St. and money is now flowing into the stock market at the expense of bonds… or is it the other way around. My gosh, my head is spinning… and I watch this intently every day. You better sit down.

As always, mortgage markets and mortgage rates remain in turmoil. Therefore, rates are subject to change… uh… a lot… anddddd frequently. Did I mention frequently? If you see a rate and payment you like, be ready to commit to it because it likely won’t last long. Have the nerve to PULL THE TRIGGER!

(Image courtesy: USA Today)