Fed drops the rate!
An unexpected larger drop in the Fed's rate should have positive impact on the real estate market in St. Cloud as well as around Minnesota. I was expecting a 1/4 percent drop in the Fed's rate, but the 1/2 percent drop was definitely much larger than anticipated.
How does this affect you in buying or selling a home? As a buyer you will now be able to qualify for a larger amount of money and purchase a potentially better home than before. As a seller you can expect an increase in activity on your homes as buyers that have been waiting will now be thinking about moving forward with their home purchase.
This reduction in interest rates will also help the shaky real estate maket by alleviating some of the hikes that were expected in existing ARM option mortgages. With the high number of mortgages that are already in default, this drop in interest rates will slow down the addition of new foreclosures to an already flooded market.
If you have an existing ARM loan, or some hybrid interest only style mortgage, now is probably the time to refinance. Many of the loan officers and brokers were willing to put people into mortgages that were not in the homeowners best interests in recent years. Double check and make sure that you are in some sort of fixed rate mortgage while the interest rates are down. It may cost you a little money now, but the savings will be very beneficial to you in the future.
Unsure where to go to refinance your loan or get financing for a home purchase? Give me a call at (320) 492-2667 or post your questions, comments and concerns here for answers and review.
Jason Tangen
www.stcloudedin.com/blog - REAL ANSWERS for REAL ESTATE in St. Cloud, MN
