Moving to head off further damage to the economy from the August credit squeeze, the Federal Reserve reduced its key lending rate a greater-than-forecast, half percentage point on September 18th….the first cut we have seen in four years.

 

“The tightening of credit conditions has the potential to intensify the housing correction, and to restrain economic growth more generally,” the Fed stated.  Policy makers said they were ready to ‘act as needed to foster’ growth and price stability.

 

Indications are that the Fed will once again cut the benchmark rate by a quarter percentage point at the October 31st policy meeting, and may reduce it even further in December.

 

The affect could mean further reduction to the rates consumers pay on their credit cards, auto loans, and home equity lines of credit. 

 

These are signs are better times to come for the housing market with the government trying to do what they can to help stabilize the market. There are still many loan programs available with historically low interest rates.

 

If you have any questions or would like to find out if you should consider a refinance to a more favorable loan, please don't hesitate to contact us today!

 

Anne Galvez