It’s Fed Day, which means that the Fed just finished their 2-day meeting. At 11am our time this morning, they announced (as expected) that they are raising rates by .25%. The Fed is currently in a press conference, so we will see how the mortgage rates respond to the announcement.
Misinformation on Major News Sites
But thing that caught my attention was this article from CNBC, where it’s talking about the Fed increasing rates. The 2nd bullet point says: “Everything from credit cards and car loans to student loans and mortgages will be affected by the central bank’s 11th rate increase.”
This is something that I talk all the time: it doesn’t have a direct impact on mortgages. In fact, at the time this video was filmed, mortgage-backed securities (which means mortgage rates) are actually moving in a favorable direction – they are moving down. The reality is that mortgage rates improved just a little bit!
But this article would lead you to believe that the Fed increasing interest rates will have a direct impact on mortgages.
Don’t Believe Everything You Read Online
Now, I can completely understand why every client that I work with is always worried about the upcoming Fed meetings and they want to make sure their mortgage is locked in. It’s because of misleading headlines, like this article.
For what it’s worth, if you read the article, it actually makes it seem like there is a direct impact… but there is also a bit of a differentiation, making it even more confusing overall.
It’s articles like this that are spreading misinformation about the Fed’s decisions having a direct impact on mortgage rates. It’s just not true! The truth is that what The Fed does, actually doesn’t have a direct impact on mortgage rates.
Personalized Mortgage Advice
If you ever want to know what is really going on in the mortgage industry, then reach out to me any time. I’m happy to run the numbers and help you see options for buying a home or refinancing your current home.