Will the Fed cut rates? Yes, they will - 1/2 point

[CPA]

Just wanted to know your thoughts.

Update: Fed cuts rates by 1/2 point. Bigger than expected.

 

[MichaelD]

I am "worried" about this. If they do, the interest rates will be the lowest they've been in history (I think I read this yesterday).

NOW would be the time for me to buy a house...but I'm leaving the country on business for awhile in Feb....house hunting/paperwork/closing the deal takes MONTHS.

It would be good if they did though.

 

[Hayabusa Rider]

Probably not. Rates are low, and I do not think you would see a significant change unless there is a huge cut. Knowing this, the feds IMO will let things ride.

 

[manly]

All signs point to a rate cut; the only question is if it's a quarter point or half point.

Either way, it won't really matter. Consumers have pushed the economy as far as it can go with low-rate financing and businesses are still reluctant to boost capital expenditures or hiring.

 

[bGIveNs33]

I think they need to cut capital gains tax. If people started investing then the private sector would get a nice boost.

 

[vi edit]

Don't think so. They are tired of lowering it, and it just relays the attitude that "we're screwed".

 

[Vic]

IMO, No.
The stock market has been up for several weeks. Economic indicators are flattening. I believe the Fed will adopt a neutral "wait-and-see" stance again.
Also, contrary to popular myth, a cut in the overnight Fed Funds rate does NOT mean a corresponding decrease in mortgage rates. If anything, a cut will probably cause mortgage rates to rise.

 

[Hayabusa Rider]

Guess the question is if the feds dropped the rate to 0, would it do much?

 

[CPA]

Originally posted by: Hayabusarider
Guess the question is if the feds dropped the rate to 0, would it do much?

Exactly, once you are at 0, you can't go any lower. Then what?

 

[dullard]

You can go below 0. In fact isn't Japan in that state now (or just recently if they are out of it). Basically banks charge you a fee for keeping your money safe. There is no reason it has to bottom at 0. I tend to think another rate cut will do nothing. Its like if you call someone on the phone and no one answers after 10 rings. Do you wait for another ring? The chance is it still won't be picked up.

 

[CPA]

ttt

 

[Evadman]

Time to buy a house!

 

[Viper GTS]

Originally posted by: Evadman
Time to buy a house!

Great for all of you who CAN buy one. I'm barely 20, though, & don't have sufficient credit history to get a decent loan on a car, much less a house.

Blah.



Viper GTS

 

[wyvrn]

Refinancing my house sounds pretty appealing now, but I don't know if the cost of the refi would outweigh the interest savings I get since

1- I overpay my mortgage every month and expect to have it paid in 8 years
2- I got a pretty good rate in June for my house anyway.

Any refinance experts out there?

 

[vi edit]

Great for all of you who CAN buy one. I'm barely 20, though, & don't have sufficient credit history to get a decent loan on a car, much less a house.

You'd be amazed. I was 22 when I bought our house, visgf was only 20. Shop around. Depending on the market you are in, you should be able to get a townhouse or condo reasonably cheap.

 

[vi edit]

Originally posted by: wyvrn
Refinancing my house sounds pretty appealing now, but I don't know if the cost of the refi would outweigh the interest savings I get since

1- I overpay my mortgage every month and expect to have it paid in 8 years
2- I got a pretty good rate in June for my house anyway.

Any refinance experts out there?

If I refinace right now, I'll be looking at $2000 in closing (bleh, I know), and then a $2000 out of pocket buy down. I'll save nearly $200 a month. I'll pay of the refinance in under two years time.

 

[bGIveNs33]

Originally posted by: wyvrn
Refinancing my house sounds pretty appealing now, but I don't know if the cost of the refi would outweigh the interest savings I get since

1- I overpay my mortgage every month and expect to have it paid in 8 years
2- I got a pretty good rate in June for my house anyway.

Any refinance experts out there?

I'm just shooting off my hip but I would say no. It cost around 500 dollars to refinance and if you already have a good rate and will be it off soon, you should be ok.

 

[shiner]

Originally posted by: bGIveNs33
I think they need to cut capital gains tax. If people started investing then the private sector would get a nice boost.

 

[HeroOfPellinor]

It's never a "good" time to buy a house. When the rates are low sellers know you're paying low interest so they can think they can charge more for their houses, so house prices rise. When rates are high, house prices are lower, but you're paying more interest. It all balances out.

 

[wyvrn]

In my case, we went with the appraisal since the lender woudln't finance above it and I wasn't about to pay more than it's worth. The seller agreed, but then again he was my bro

Originally posted by: HeroOfPellinor
It's never a "good" time to buy a house. When the rates are low sellers know you're paying low interest so they can think they can charge more for their houses, so house prices rise. When rates are high, house prices are lower, but you're paying more interest. It all balances out.

Wow that's a big difference. What was the percentage difference in interest rate you got by refinancing? For instance, right now I am at 6.25% on a 15yr and I am not sure I could beat that by enough to make it worthwhile.

If I refinace right now, I'll be looking at $2000 in closing (bleh, I know), and then a $2000 out of pocket buy down. I'll save nearly $200 a month. I'll pay of the refinance in under two years time.

 

[vi edit]

Wow that's a big difference. What was the percentage difference in interest rate you got by refinancing? For instance, right now I am at 6.25% on a 15yr and I am not sure I could beat that by enough to make it worthwhile.

Going from a 7.25 conventional 30 year, to a 4.85 7 year arm

 

[Kev]

Slightly off the topic of this thread but... Should I consolidate my student loans? Mine are at 8.5% and I got a few mailings a few weeks ago that said they could reduce my interest rate to 3.5%. I have no idea how this crap works, but do you think this would be a good idea? It seems shady because I don't see how they can reduce my interest rate by 5% without there being some catch, and I didn't see any fine print.

 

[vi edit]

Originally posted by: maladroit
Slightly off the topic of this thread but... Should I consolidate my student loans? Mine are at 8.5% and I got a few mailings a few weeks ago that said they could reduce my interest rate to 3.5%. I have no idea how this crap works, but do you think this would be a good idea? It seems shady because I don't see how they can reduce my interest rate by 5% without there being some catch, and I didn't see any fine print.

HELLS YES! You are paying double what you should.

 

[wyvrn]

Absolutely. For the interest savings plus consolidation makes them easier to pay off. You want one large debt with low interest and the ability to overpay every month vs. having many small debts at varied interest rates.

Originally posted by: maladroit
Slightly off the topic of this thread but... Should I consolidate my student loans? Mine are at 8.5% and I got a few mailings a few weeks ago that said they could reduce my interest rate to 3.5%. I have no idea how this crap works, but do you think this would be a good idea? It seems shady because I don't see how they can reduce my interest rate by 5% without there being some catch, and I didn't see any fine print.

 

[CPA]

Originally posted by: maladroit
Slightly off the topic of this thread but... Should I consolidate my student loans? Mine are at 8.5% and I got a few mailings a few weeks ago that said they could reduce my interest rate to 3.5%. I have no idea how this crap works, but do you think this would be a good idea? It seems shady because I don't see how they can reduce my interest rate by 5% without there being some catch, and I didn't see any fine print.

Just make sure they are not asking for money upfront, that they allow prepayment without penalty and they aren't extending your terms more than what you have left (ie 60 months when you only have 24 months to go).