|
|
|
California Real Estate: "Bubble" or the World's Greatest Bargain?
A day doesn't pass when a self-anointed talking head doesn't make solemn noises of "California Real Estate bubble".
I'm a hands on Realtor in Pleasanton, California, San Ramon, and Danville. We are the epicenter of paradise, 20 minutes east...
Concrete Cutting: Basement Remodeling Done The Right Way
Basements or cellars (depending on which part of the country you are from) are primarily seen as dark and dingy parts of a home. In most cases they are considered a useless area or are used as a "catch all" for family discards that haven’t quite...
Improving Curb Appeal
What if your real estate agent could give you a fool-proof way to sell your home quickly and get top dollar for it too? Well, nothing is more important in attracting potential buyers to your home than curb appeal. What is curb appeal? Well simply...
The Value of Concrete Countertops
The Value of Concrete Countertops Customization Increases
Aesthetic Appeal and Real Estate Investment for Homeowners
STEAMBOAT SPRINGS, CO--From top-dollar homes in the San
Francisco Bay Area to sprawling mountain homes in the...
Why You Should Sell Your Property Privately
With 70% of potential home buyers looking online to find property and with estate agents charging up to 4% in sales commissions, more and more people are starting to consider selling their property privately.
In this article we’ll examine why you...
|
|
| |
|
|
|
|
Interest Rate Increases And You!
After 12 rate increases by the Fed, it does appear that the real reason behind the Fed action is to apply the brakes on inflation. The Fed seems confident that economic growth is on track but wary that costlier energy could "fuel" dangerous inflation. From all reports it is working. All types of borrowing will cost more. On the "Sunny-Side" savers will shortly see a bump in the meager interest they are receiving as deposit interest runs opposite to loan rates.
The Federal reserve today raised the Fed Funds Rate 1/4% to 4.0% The federal funds rate is the rate banks charge each other for overnight loans to comply with the Fed's reserve requirements. By buying or selling Treasurys in the market, the Fed can set the interest rate and influence the price of credit. Th ePrime Rate, that many members understand will shortly be raised the same amount.
What Does It Mean To You?
Adjustable Rate Mortgages
ARMs have the most one for one relationship with the Fed Funds rate -- they are usually indexed against the one-year Treasuries which are tied closely to the Fed Funds Rate. Every borrower will feel the pain when these rates go up
Some borrowers who recently got an ARM may know that their rate can only go up a maximum 2 points
If interest rates go up two percentage points on a $216,000 mortgage ( About the average in the U.S.) Borrowers could be on the tab for $269 more a month.
Fixed Rate Mortgages
The Fed plans deliberate future increases also
meaning fixed mortgage rates may continue their rise.
If Mortgage rates go up 1 Point, the above $216,000 loan would cost $140 more per month (5.4% vs 6.4%
Lines of Credit Tied To Home Equity
These loans are mostly always tied to the Prime rate so expect a rise in the very near future.
Home Equity Loans
These loans are ties to the equity in the home and are pegged to one-year treasury yields or the prime, which move in lockstep with the Fed rate.
If you are in the process of borrowing now, it may well pay to —LOCK IN THE RATE TODAY as the full effect may not hit for a few more weeks. After that look to pay about $100 more per month on $100K loan.
Copyright 2005 Promotions Unlimited – All rights reserved.
About the Author: Bob Schwartz runs 4 real estate sites. At http://www.brokerforyou.com/real-estate-partner-sign-up.htm can tade links w/these sites. His main site offers web hosting - domain registration & Internet software. http://www.websitetrafficbuilders.com Improve your sites creditability w/Free web site awards: http://www.web-site-award-winning.com
Source: www.isnare.com
|
|
|
|
|
|