The Veridian Blog

The Fed is scheduled to meet tomorrow and is widely expected to plunge the Fed Funds rate below 1.0% for the first time since the 1950’s to help the struggling American economy.  Although the Fed rate cut is seldom directly correlated with mortgage rates (email me for an in-depth explanation), the 30-year fixed is currently at the lowest levels since the heart of the refi-boom during the spring of 2004. 

Fueling the downward trend last week were jobless claims exceeding analysts’ expectations increasing to 573,000 from 515,000, retail sales declining for the 5^th straight month, and the ever unpopular auto-bailout dying in the Senate on Thursday.

Remember that the 2009 Conforming loan limits are already in effect – loan amounts up to $625,500 are eligible for sale to the GSEs.  In similar fashion to last year’s “Jumbo-Conforming” loans, nearly all lenders have implemented a third pricing tier for loan amounts between the traditional conforming loan limit of $417,000 and $625,500.