Fed Rate Cuts Predicted
Federal Reserve Chairman Ben Bernanke is expected to cut prime interest rates today in an effort to lessen the impact of the credit crunch that was created by the sub-prime mortgage market.
Most economists are predicting a quarter point cut while some economists are asking for a bolder half point slash.
The current 5.25 percent that banks charge other banks has not been cut in over four years.
It is unclear how much this expected cut will help distressed home owners that were caught up in the sub-prime lending schemes that offered teaser rates going into a mortgage that eventually place monthly home payments at an unsustainable rate that has lead the industry to record foreclosures.
I will keep you posted as we are most defiantly in a very volatile housing market.
Rhonda McMillan
~Broker
