FED RATE HIKE

“𝗧𝗵𝗲 𝗙𝗲𝗱 𝗷𝘂𝘀𝘁 𝗵𝗶𝗸𝗲𝗱 𝗺𝗼𝗿𝘁𝗴𝗮𝗴𝗲 𝗿𝗮𝘁𝗲𝘀!!!” 😲
👉 (𝘋𝘰𝘯’𝘵 𝘱𝘢𝘯𝘪𝘤, 𝘵𝘩𝘪𝘴 𝘪𝘴𝘯’𝘵 𝘵𝘳𝘶𝘦!) 👈
Many people confuse increases in the fed funds rate made by the Fed with an increase in mortgage rates. 𝗛𝗼𝘄𝗲𝘃𝗲𝗿, 𝘄𝗵𝗲𝗻 𝘁𝗵𝗲 𝗙𝗲𝗱 𝗿𝗮𝗶𝘀𝗲𝘀 𝗽𝗼𝗹𝗶𝗰𝘆 𝗿𝗮𝘁𝗲𝘀 𝗶𝘁 𝗮𝗰𝘁𝘂𝗮𝗹𝗹𝘆 𝗛𝗘𝗟𝗣𝗦 𝗺𝗼𝗿𝘁𝗴𝗮𝗴𝗲 𝗿𝗮𝘁𝗲𝘀 𝗶𝗺𝗽𝗿𝗼𝘃𝗲!
Why is that? 🤔
✅ The simple answer is that the Fed rate hikes will slow down the economy and hopefully curb inflation, and inflation is actually what drives rates higher. As markets anticipate the Fed will have to raise rates, mortgage rates do move higher, but months in advance of actual rate hikes. Once the Fed actually raises rates, we often see mortgage rates improve slightly afterwards.
𝗔𝗹𝘁𝗵𝗼𝘂𝗴𝗵 𝗶𝘁 𝗶𝘀 𝗮 𝗯𝗶𝘁 𝗺𝗼𝗿𝗲 𝗰𝗼𝗺𝗽𝗹𝗲𝘅 𝘁𝗵𝗮𝗻 𝘁𝗵𝗮𝘁, 𝘁𝗵𝗲 𝗺𝗮𝗶𝗻 𝘁𝗮𝗸𝗲𝗮𝘄𝗮𝘆 𝗵𝗲𝗿𝗲 𝗶𝘀 𝘁𝗵𝗮𝘁 𝗠𝗢𝗥𝗧𝗚𝗔𝗚𝗘 𝗥𝗔𝗧𝗘𝗦 𝗗𝗜𝗗 𝗡𝗢𝗧 𝗚𝗘𝗧 𝗪𝗢𝗥𝗦𝗘!
In fact, the rates you have access to may even have improved.
𝗜𝗳 𝘆𝗼𝘂’𝗱 𝗹𝗶𝗸𝗲 𝗺𝗲 𝘁𝗼 𝘁𝗮𝗸𝗲 𝗮 𝗹𝗼𝗼𝗸 𝗮𝘁 𝘆𝗼𝘂𝗿 𝘀𝗶𝘁𝘂𝗮𝘁𝗶𝗼𝗻 𝗮𝗻𝗱 𝘀𝗲𝗲 𝘄𝗵𝗮𝘁 𝗿𝗮𝘁𝗲𝘀 𝗮𝗿𝗲 𝗮𝘃𝗮𝗶𝗹𝗮𝗯𝗹𝗲 𝘁𝗼 𝘆𝗼𝘂, 𝗿𝗲𝗮𝗰𝗵 𝗼𝘂𝘁 𝗮𝗻𝘆𝘁𝗶𝗺𝗲. 𝗜’𝗱 𝗹𝗼𝘃𝗲 𝘁𝗼 𝗵𝗲𝗹𝗽 𝘆𝗼𝘂.
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