Posted by: Larry Stevens | February 19, 2010

Fed Raises Interest Rates

AA REALTORS BOISE helps keep you up to date on whats going on in today’s fast paced real estate market. As your Boise Realtor he can help you not only stay informed on Idaho Real Estate but can also help you find the best homes in Boise, homes in Meridian, as well as GREAT homes for rent in Boise! Here’s the latest:

The Federal Reserve announced on Thursday that as part of an exit strategy to begin “normalization of the economy” it will raise interest rates on short-term loans to banks — sending stocks across the world tumbling and raising fears that mortgage rates may also increase.

Even though home mortgage rates are at record lows, the Federal Reserve’s recent actions point to a change in its policy of bailing out all of Fannie and Freddie’s mortgage-backed securities. It has been this practice which in truth has kept mortgage rates artificially low. However, it has also helped homeowners riddled with past due mortgage payments and buried under debt.

The move came as a surprise to many, what with the financial system is still treading on eggshells. The carbon scoring left on the sector by the credit fiasco will be difficult to recover from. And even though this move will not have a direct effect on home mortgages, auto loans, or credit card rates, the stock market is already overreacting.

Current Mortgage Rates

Mortgage rates continued to drop for the second week in a row. This is a good sign of a recovering housing market. According to the National Association of Realtors, home sales actually rose last year especially in the third quarter.

The 30-year fixed-rate mortgage averaged at 4.93 percent this week, down from last week’s 4.97 percent average. The 15-year fixed-rate mortgage also dropped from 4.34 percent to 4.33 percent this week. Adjustable rate mortgages followed suit with the 5/1 ARM down to 4.12 percent and the 1-year ARM at 4.33 percent.

For those homeowners still plagued with mortgage debt, Obama announced today a new plan to assist homeowners. A total of $1.5 billion will be dedicated to the cause. It is intended to prevent further foreclosures. Whether this “not” stimulus plan will be a successful remedy to the woes of the economy , or is yet just another duct tape patch, is yet to be seen.

Looking for the best real estate in Idaho? You need to work with a qualified Boise Realtor who knows the business and can help you avoid common mistakes and even pitfalls seasoned home buyers can make. Larry Stevens of AA REALTORS BOISE can help you buy your next home in Idaho or sell your current Idaho home. Call or visit him online today!!

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