The Federal Reserve has decided to cut interest rates once again. The time the key interest rate was cut by 0.75 percent dropping it to 0.25 percent.
With the US economy all but down the toilet, the Federal Reserve is taking measures that will hopefully put some life back into the markets.
The first step to reviving the market is to make money between banks virtually free of interest with the rate cut they announced today. The Federal Reserve also reiterated that they will be purchasing large amounts of mortgage backed securities to help revive the mortgage and real estate markets.
Will this rate cut be what mortgage lenders needed to feel more confident about lending out their money or are they just going to hoard the money like the have been doing for months? Either way, lending standards will continue to be very tight as foreclosure numbers and re-default numbers continue to sour.
The rate cut may also reverse the downward trend of mortgage rates as of late. However, there are many efforts out there by organizations pushing Congress and The Feds to get the 30 year fixed rate down to 4.5 percent, even 2.99 percent in some cases.
Mortgage News
