A Back-Firing Fed Policy?

This blog covered in a post last month the fact that the Fed has indicated a commitment to keeping long-term interest rates in the housing market low. In fact, as we also reported, the Fed rate hike was unlikely to affect long-term, fixed-rate mortgages. However, markets are complicated, and the Fed has more than one lever. As a result of its QE program, the Fed now owns $1.7 trillion in mortgage backed securities. And they’re not selling. Which is causing banks to get out of the business Which will reduce liquidity, and may cause interest rates to rise.


by Aimee Whitaker

Tiempo Escrow, Inc.

2100 Main Street, Suite 330,

Huntington Beach, CA 92648

Phone. 714-843-0101