212954 Resource 178438 178984 178982 1221685515632 1221690329551 Controlled BANKS ARE NERVOUS- ARM's Will Increase This Week.

If You Have An Adjustable Rate Home Loan, It Is Time To Refinance Into A Fixed Loan

Mortgage Bonds sure have been fluctuating in wild fashion so far the this week and this morning was no exception.   In the first hour of trading, Mortgage Bonds had already traded in a 44 basis points. Last night, the Fed threw insurance giant, AIG, an $85 Billion lifeline to keep it from falling into bankruptcy.  The company received a 2-year $85 Billion loan from the Federal Reserve in return for a 79.9% stake in the company's stock.  The loan has to be paid back in 24 months, which may give AIG time to sell assets to cover the bill.  This was a deal that the Fed believed had to come together as an AIG bankruptcy would have had enormous, far-reaching negative effects in the global economy.  The saving of AIG has done little to help the overall stock market, which has been trading sharply lower today. Housing Starts for August were 895,000, below estimates of 950,000. This is a 17-year low.  Building Permits were also below expectations.  This wasn't a good number, but the market was already expecting something on the weak side. There is a lot of existing inventory to clear out before the numbers on this front will improve.    What is going on with LIBOR, you may be asking?  LIBOR as well as the actual Fed Fund Rate, are rates that banks charge each other.  And while the Fed has set the Fed Funds target rate at 2%, banks are jacking this up closer to 6%.  The same is happening to LIBOR.  The reason is due to a lack of confidence that banks will make good on funds borrowed from each other.  The AIG scare, IndyMac Bank, Lehman, and others have spooked banks into thinking that they may not be paid back.  And a low 2% rate is just not enough to justify the risks of lending in today's environment.  This means that those with ARMs tied to LIBOR that are adjusting soon should immediately contact a mortgage advisor to determine if a refinance to lower fixed rates makes sense.  10 application/xml false adjustable rate mortgages home loan rates housing starts refinance Mozilla/4.0 (compatible; MSIE 7.0; Windows NT 5.1; .NET CLR 1.1.4322; .NET CLR 2.0.50727; .NET CLR 3.0.04506.30; .NET CLR 3.0.04506.648) 127.0.0.1 127.0.0.1 aheitland 75.160.24.218 false true false false true 178975 false false true false false false true 178438 blog blogsite/BestFlagstaffHomes/web