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There are several types of rates or rate indexes which effect the rate you
will receive when you contact a lender about a loan..
- The average rate of One-Year U.S. Treasury Securities Yields is published
by the Federal Reserve board and is used to determine fixed-rate mortgages,
investments, and bonds. Unlike the 11th District Cost of Funds, this index
is based on an average of the year’s rates and not a single month, but these
two indexes tend to be fairly similar. Adjustable rate mortgages are often
based on the average rate of one year U.S. Treasury securities. This index
is determined by the U.S. Treasury.
- The Federal Funds Rate is a market rate determined by the Federal Open Market
Committee that is the rate used by banks lending to each other overnight.
This rate changes day by day and has long term effects on economic growth,
inflation financial stability.
If you are looking for a loan in order to buy a home, purchase a car, or make home improvements, there are many types of low interest loans available. Loans insured by the federal government, such as those available through the Federal Housing Administration (FHA) or the Veterans administration, can help you find a low fixed rate loan. Home equity loans and second mortgages generally come with low rates as well. However, if you do not qualify for a fixed rate loan, you will probably be looking into adjustable rate loans. Interest rates on adjustable rate loans vary along with the indexes like the ones above. It is important that you understand your loan and its interest rate so that you can know as much as possible about what your payment schedule will look like in the future.
Information about the history of most indexes, their patterns, and predictions for the direction of rates are usually available online.
Apply online to contact up to four lenders about your loan and todays interest rates.
Your interest rate can make the difference between a simple loan and a financial nightmare. Even if you have less than perfect credit, high interest rates can still be avoided. Todays interest rates are surprisingly low, making loan repayment less expensive and a more pleasant experience. Fill out our free short form to take advantage of todays low interest rates.