FED Rate cut to 0% and it’s impact on Mortgage Rates


Hey, everybody, it’s Eric with Low VA Rates I’m
doing this on my own today because we either have some employees in our
marketing and technology department working from home or because interest
rates in light of what’s happened over the weekend with the Federal Reserve
have created such a buzz and such a stir that you know look we are we everyone’s
deployed at this point right we’ve got people on the phones people closing loans
we’ve got people working from home because they’re afraid listen
just we’re gonna look back one day at toilet paper and a hand sanitizer and
all the stuff that’s going on and we’re gonna have all sorts of memories about
what’s happening what I’m trying to do today I had a video last week that was
very very similar to this I want to talk to you about the Federal Reserve’s
emergency rate cut to zero right they cut interest rates all the way down
to zero over the weekend and what some are calling an unprecedented move and
many others are saying it’s not even enough they’re gonna have to do more but
this is short and to the point hopefully it’s not another minute long how did
that Fed rate cut similar to the one that they did just two weeks ago how did
it affect interest rates and what does it mean to you number one if you’ve just
done a refinance or you’re in processing and Geordi locked in it doesn’t affect
you at all okay because if you just refinanced in the last couple of weeks
or months then you need to just hold tight and wait and see what the
long-term ramifications of this interest rate could are because you’ve already
got a great interest rate and interest rates are not much lower if for some
people they’re not even any lower so you’re good now if you’re currently in
processing and locked you’re good because interest rates have not gotten
better that’s what I want to focus on right now you know my phone start to
blowing up Sunday evening right after the Fed cut those rates
I had consumers I had employees I had family members just lighting up my phone
and of course we use technology so the apps were all ringing and notifications
everybody wants to know hey I saw the Fed just cut rates what does that do to
my interest rate you can quote me on this you can take this to the bank but
go to Google go to Yahoo go to whatever search engine you want and just type in
how does a Fed cut effect mortgage rates here’s what
you’re gonna find and you can report back to me on our YouTube comments if
you disagree it has no direct influence or correlation on mortgage rates okay it
has no direct influence so just because the Fed rate went to zero doesn’t mean
interest rates on mortgages are going to zero but it does have an indirect impact
or influence but let me tell you what it did this I and what I mean by that is
the lower the Fed rate goes the lower mortgage rates go okay that’s that’s
true if anyone tells you otherwise they’re misleading you but it’s not
instant and there are situations we just saw this last week where even though the
Fed cuts rates mortgage rates go up and so that’s what I’m here to tell anyone
that’s waiting for lower interest rates do you need to understand we just got
news today from some market makers I don’t want to name these lenders but big
lenders that you guys would know that are all over the world all over the
country some of them all over the world are hiking their interest rates to slow
down the influx of mortgage applications ok banks can do that just because the
Fed is lending rates cheaper to the banks the banks do not have to turn on
and give that back to the consumer in the form of lower mortgage rates so
right now the best thing you can do is close those loans that you already have
locked in now what do I think we’re gonna be 3 6 9 12 even 24 months from
now I do think interest rates what this Fed rate cut did is and what it’s
supposed to do if it works out the way everybody wanted it to the way the Fed
wanted to it should keep interest rates low for the foreseeable future I think
we’re gonna see interest rates down here in the low threes or super high twos for
the next 18 to 24 months maybe even longer the Fed wants to wait until this
coronavirus has passed the stock market comes back people start getting back to
work and once all the dust is settled maybe then you’ll see rates creep up but
interest rates on mortgages do not have much further down to go many people
don’t think they’ll go any further ok so if you want to gamble and you want to
take a risk feel free but I would not suggest doing
that I would locking at these rates if you’re not
locked in I would get on your way to lower payments and lower interest rates
and look if things get way WAY worse and the Fed has to do more at the end of the
summer or even into the close of the year
the sooner you close your current loan the more likely you are if rates go
lower to be able to do something again in the future but waiting right now
would be a big mistake in my opinion thanks for watching

11 Comments

  • What’s your current rate?

  • great video keep it up dude

  • awesome content keep it up bro

  • Where to get mortgage rate ?
    Every website shows different results.
    Cant trust anyone.

  • I bet you guys are so friggin busy hahaha stay safe and keep up being the best va loan place i have found!

  • Good info Eric, thanks!!!

  • Eric, great video and thank you for sharing with us your knowledge on this matter.

  • do you accept TP for payment? JK, but I am going to wait for the mortgage rate drop to also be passed down to the consumer.

  • Love The Video .Nice and short , right to the point, Easy to understand.Thanks

  • I would wait and see if the current market goes lower. It has happened before. Patience is key.

  • Man this guy is a no bull, straight shooter. Thank you sir.

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