Scottsdale Homes' Blog: Mortgages

Although it's Halloween today, this is no trick. In fact, it's more of a treat for consumers who like cheap money. After cutting the short term interest rate .50% in September, the Fed went ahead and posted another interest rate cut of 0.25%. The federal funds rate is an overnight lending rate for banks which impacts among other things what consumers pay on credit card debt, home equity lines of credit , and auto loans.

This is great news for consumers, but it does not necessarily affect those who are shopping for a home loan. Mortgage rates are generally based on the 10-year U.S. Treasury bond yield, which actually rose after the .50% percent cut in September. This was a case when maybe a .50% cut was a little too much when viewed by mortgage investors…