How does the feed cut to 2% oblige society beside mortgages and student loans? even those next to existing loans?
Answers:
beside a lower rate, the prime rate goes down, The libor should too, & you can possibly consolidate or refinance a current loan at a lower rate.
The feed rates have little to do with mortgages but it does hold a lot to do with the current inflation and devalue of our dollar.
Fed cuts in rates do not necessarily affect mortgage rates, nor is there any direct correlation between the two. It is the biggest myth surrounded by the world, and I wish people did not deliberate this was the case. See the article:
http://www.schwab.com/public/schwab/rese…
The biggest indicator for mortgage rates is base on the bond market as was already explained, but inflation, the utility of the dollar, (un)employment and other external factors - such as liquidity (demand) in the minor market will have a greater impact on rates than the Fed cuts. Source(s): Mortgage biz for 10 years
Not much on the mortgage side. Lenders take their cue from the bond souk, not the Fed. And those rates are rising generally.
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