Home Refinancing At Lowest Rates

For several months now home loan interest rates have been cut in an effort to stave off inflation. US benchmark interest rates are at the lowest level since June 2004 after the Federal Reserve this morning cut its key interest rate from 1.5% to 1%.

Having cut the fed rate six times one would think the economy would make a come back but with the stock market crash only days ago the eonomic turnover for the better seems distant.

Still the constant cuts are good for those shopping low mortgage interest rates. At the lows just keep coming. San Francisco Federal Reserve President Janet Yellen said the Fed could lower rates below 1%, and that they could reach as low as zero amid a weak economy. If the Fed do cut rates to 1% this would be the lowest level since June 2004.

What effect did this low level cut have on the economy? Will this cut produce long term economic stability? Only time and a little hope will tell. Just remember it's been done before and not so long ago. And although it's a drastic move to fend off a serious downturn it is indeed a home buyers market and a home refinancing treasure trove.

Homeowners with 2nd Mortgages Get Some Relief Refinancing

As the Fed cut rates consectively to revitalize the economy homeowners are seeing a golden opportunity to save money and reduce credit obligation. With the recent drop in interest rates, homeowners carrying two mortgages are deciding to refinance, combining both the first and second mortgages into a single loan at a better interest rate.

If one of your current mortgages already carries a low interest rate, you should only refinance it if you can match or better the rate with your new loan.

Although you do not have to combine both mortgages in order to refinance if both rates are high and current rates are significanly lower, say .50 basis points lower why not do so if you are able. You should be able to reduce your interest charges dramatically.

What ever you do get out of that ARM. No one really knows what the economy will look like months ahead.

That said get out of the ARM as soon as possible. ARMs are volatile and can alter your financial situation drastically. Get into a fixed rate ASAP.

The Fed is expected to cut rates .50 bps following a historic rate cut of .75 bps just last week. It now is at 3.5 percent, but is expected to drop to 3 percent at the Fed meeting Jan, 30th 2008.

Banks would be expected to lower their prime lending rate by a corresponding amount — from 6.5 percent to 6 percent. The prime rate applies to certain credit cards, home equity lines of credit and other loans. That means both the funds rate and the prime rate would be at nearly three-year lows.

Compare home mortgage rates offered by lenders to those you currently have. You may be able to save hundreds if not thousands over the life of the loan refinancing at today's lower rates.

Feds Cut Interest Rates 0.75 bps - Good Time To Refinance?

Wednesday, January 25, 2008

Following a December rate cut the Fed acts again to boost a weakening economy and prevent recessionary contagion.

Federal Reserve made history yesterday cutting the interest rate a whopping .75 Bps. This was the fourth interest rate cut in the last few months.

Feds cut rates 75 bps. The biggest cut in 17 years. Homeowners seeking release from ARM's may see this as a good time to refinance.

The New York Times reports, "The reduction in the federal funds rate from 4.25 percent down to 3.5 percent marked the biggest reduction in this target rate for overnight loans on records going back to 1990."


The results? Stocks surged as a result of the news. Loan applications increased and Internet rate hunting activities increased 33% according to Fimark's Refinance Loan Rates resource.

The home mortgage refinance resource resource encourages consumers to negotiate with multiple lenders who are willing to beat or meet other offers. Remember to lock-in attractive rates for as long as it takes to process the loan.

Experts predict the Fed would lower the funds rate to 3 percent by the end of March 2008.

Those with an adjustable rate loan (ARM) or credit card can anticipate a drop in rates in the weeks following a rate cut. Fixed rates are not immediatly affected. Still 15 or 30 year fixed rate loan programs will benefit from improved mortgage lending market and consumers can expect more attractive loan packages.

Those opting for a 15 or 30 year fixed rate loan program may see a savings of up to tens of thousands of dollars with a rate that's just .25% higher.