Ryan’s Mortgage Blog:
As you may have heard the feds cut the federal funds rate again today by .25 points, and the prime rate will fall to 5%. This action is good news for people who borrow money on loans that are linked to the prime rate. Here is an excerpt from the reserves comments today, “Recent information indicates that economic activity remains weak. Household and business spending has been subdued and labor markets have softened further.” Tell us something we don’t know…they always seem to be a step behind, or maybe I just watch too much Jim Kramer and Mad Money.
Mortgage rates were slightly on the rise last week preparing for today’s meeting. Many believe the mortgage rates have bottomed out give or take 1/4%, but we’ve heard that before. I don’t think the feds can afford to do many more cuts, if any at all, because I don’t think the US dollar can take much more of a beating.
The changes in rate affect oil/gas prices and I found a couple of informative articles that help explain how the rates affect oil. The bottom line that I found is that gas prices probably aren’t going to go down any time soon, but the bubble will bust sooner or later once the dollar gets stronger. I have other opinions about the gas and oil problem but this isn’t the place to get into it 🙂
For any mortgage related questions I can be reached at RBaker@PeregrineLending.com or 805-540-0866