The FED decided today to not change the FED Funds Rate.
The rate will remain at two percent (2%). One vote was
cast to increase the rate, but only one vote. The last
time the FED voted on the fed rate, there were two votes
to increase the rate. What does this mean to you if you
are facing interest charges from credit cards and
mortgages and automobile loans and other loans? Very
little.
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Whereas mortgage companies will use an increase in the
FED rate as an excuse to quickly raise the rates on new
mortgages and adjustable rate mortgages, lowering the FED
rate does not translate into a lowering of new mortgage
rates or on existing adjustable rate mortgages. Credit
card rates are pretty much the same thing although
credit card companies will double or more interest rates
on accounts that are late or past due.
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Interest rates on automobile loans and personal loans
are usually fixed so borrowers probably would not be
effected on existing loans. Rates on new automobile
loans are zero percent usually anyway in our current
automobile market so FED rate adjustments would not
matter. Car dealers are having trouble selling cars so
they are offering special 0.00% interest loans left and
right (Take advantage of these if you are in the market
for a new vehicle and you can -
Get a Free Dealer Price Quote from up to 4 local dealers in your area.). Rates on new personal
loans probably do the same as mortgage rates - they
adjust up quickly if the FED rates go up, but they are
slow to adjust down if the FED rate goes down.
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If you disagree with anything I have said, post a
comment on the blog page; but please, do not just post
your opinions. Post your comments, and back them up with
facts. I will be the first to accept corrections, but
show me something that backs up your statements.
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How will today's decision by the FED not to change the
FED rates effect Noah and his foreclosures and such? Not
very much, as far as I can tell. My credit card rates
will remain the same (I have one card that I use which
gets paid off every month). That credit card is
currently at about 11%. I am not behind on that card,
and I pay it off every month so even if the rate goes up
I do not have a revolving balance that would be subject
to interest rate charges. I have a loan on a leased new
car. That should not change. I have several mortgages.
Those will not change even though they are adjustable
rate mortgages. So, in summary, I am in no better
position after the FED's announcement that I was before.
Way to go FED! Thank you very much!
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On the news channels today, there is a lot of talk about
the FED saving the U.S. economy. From my perspective,
there is very little that the FED can do to help us. All
they can do is try to moderate it. Their efforts have
very little effect on my individual situation. Does it
effect yours? Tell us how if so.
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