Florida Mortgage Rates – FED Report

by Florida's #1 Mortgage Planner on March 18, 2009

Locking Stance: CAUTIOUSLY FLOATING    Mortgage Bonds: +19bp

You have to love the Fed and Ben Bernanke and his buddies through the markets another spin to get them to artificially run up and break their 50-day moving average.  The good news is that will drive rates a little lower, though lenders will likely hedge themselves so the “savings” is not likely to be passed through, at least not much, and not right now.

So what happened?  As I said this morning, watch out for what the Fed says in their Policy Statement and this one was clearly, “Hey everybody, we are not afraid of printing more money and using it to buy MBS, and even Treasuries!!!”.  That, even when inflationary pressures are starting to show signs of life, but the markets love a “free ride” to profits, so mortgage backed securities are likely going to go through the roof, that is until the “mortgage rate bubble” bursts.  I will have a complete breakdown of the Fed’s Policy Statement over at Florida Mortgage Report this evening.

What does this mean for Florida Mortgage Rates?  For now, the picture has changed thanks to the Fed’s manipulation of the markets, so expect mortgage rates to tick down slightly as the Fed has more than doubled their promised purchasing of MBS.  Do not however, buy in to media hype that rates are going to drop significantly as they most likely will not.

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