When the Federal
Reserve meets, we all have questions:
What does it mean to me? Will my mortgage
rate go up or down? Is this a good
time to refinance? Bankrate is here
to help. We've looked at five categories
-- mortgages, home equity loans, auto
loans, credit cards and certificates
of deposit -- to determine if the
Fed's moves made you a winner or a
loser. Here's a look at mortgages:
Winner: Adjustable-rate mortgage holders
The series of Federal Reserve rate cuts that began last fall caused monthly mortgage payments to drop for many borrowers with adjustable-rate mortgages.
Had the Fed raised
rates this week, some homeowners
with ARMs would have seen a
bump in their monthly payments
the next time their mortgage
adjusted.
Such homeowners can relax -- at least for now.
Loser: Borrowers waiting for lower rates
It's impossible to know where mortgage rates are headed. However, rates have been trending higher and many experts predict we've already seen the lows for 2008.
Anyone waiting for a quick return to the 5.57 percent averages of January is likely to be disappointed.
Take action
The Federal Reserve's decision to leave the federal funds rate unchanged is unlikely to significantly impact mortgage rates.
However, any homeowner with an adjustable-rate mortgage should consider refinancing soon if the current loan is due to reset significantly higher.
"For anyone confronting
a painful short-term reset that
could swap into a fixed-rate
product on a comparatively attractive
basis, act now," says Richard
DeKaser, chief economist at
National City Corp.
Fed announcement: June 24, 2009
Winner: Adjustable-rate mortgage holders
