Today, the Federal Reserve announced that they were raising interest rates. This is the third consecutive interest rate hike, and the Fed is citing a strong economy and low unemployment as reasons for this decision.
However, potential homebuyers don’t need to worry about mortgage rates increasing as the Fed makes their announcement.
The Fed raised short-term interest rates today, but mortgage rates, particularly for the 30-year fixed rate mortgage, are determined by the 10-year Treasury bond. Bonds are influenced by market conditions, global events, etc. and not by the Federal Reserve.
For those considering buying a home, know that though mortgage rates can increase at any moment, they won’t go up just because the Fed raised interest rates.
Source: HousingWire.com, June 14, 2017