Tuesday, April 29, 2008

So much happening it's hard to stay on top and blog

The Libor rate has been called into question lately as perhaps being artificially low, this will affect many borrowers who have an ARM that will adjust based on Libor. A Citibank analyst was quoted in the Wall Street Journal last week saying that banks may not be disclosing their true borrowing costs when reporting the rate at which they borrow, and more importantly there is no way to calculate a 1 year Libor rate when the longest one bank will loan to another is 3 weeks.

Also the Fed is meeting again this week, so it's bound to be a bumpy ride in the mortgage rate market this week. So far so good this week, with rates dipping slightly, but I'm unsure what's going to happen if the Fed cuts their rate this week, are inflationary concerns going to drive up rates, or will the recent economic slip allow rates to be maintained at their current levels.

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