How GDP Affects Interest Rates: LoanLove.com Posts A New Video Explaining The Three Biggest Indicators That Have An Affect On Interest Rates
SAN DIEGO, July 20, 2013 /PRNewswire-iReach/ -- LoanLove.com is a borrower advice website that provides detailed insights into the mortgage industry in a fun and entertaining way. The team at LoanLove.com is devoted to help empower both first time and experienced homeowners with valuable resources, first-class knowledge and connections to top-rated industry professionals and has the mission of helping consumers and borrowers to obtain the latest information on mortgage lending trends, the real estate market and the U.S. financial landscape in order to help them obtain a home loan that they will love. A recently posted video from LoanLove.com can help borrowers to understand how GDP affects interest rates so that they will be able to make the best decision when it comes to locking in their loan rate.
The host of the Loan Love video explains: "If you have been watching any financial news at all you've probably noticed interest rates climbing like crazy lately and you're probably wondering – will interest rates keep going up or will they go down?
The short answer and most probably scenario is – Yes, rates will keep going up and here's why:
Three of the biggest indicators that affect interest rates are the GDP, (or Gross Domestic Product), CPI (Consumer Price Index) and Payroll Employment. Without getting too technical (just to understand the big picture) I'll save you the headache of learning macroeconomics. The big picture is this: All of this alphabet soup – GDP, CPI and PE (or Payroll Employment) – are indicators of how well our economy is doing. All three of these indicators are tied to inflation and when the Federal Reserve expects inflation they raise interest rates. When our economy is stagnant they lower interest rates."
What makes these three indicators so consistent is the fact that they are coincident indicators. This means that they respond quickly to shifts in the economy. This is in contrast to the unemployment rate which lags behind the economy; shifts in unemployment do not have an immediate impact on the economy and their effect on inflation is delayed. By paying attention to these indicators, smart borrowers will be able to see when their best opportunity to lock in a rate would be. The driving factors that move interest rates up or down are not too hard to keep track of, so this information can be useful to both first time borrowers and seasoned homeowners.
The video ends by saying: "So, what does all this mean? Well, if you're interested in buying or refinancing a home, time is of the essence. All signs indicate interest rates will keep going up as the U.S. economy strengthens and threats of inflation increase. In other words, delaying your purchase or refinance can easily cost you thousands of dollars over the life of your loan. Lock in your interest rate today and you'll be glad that you did."
For more information on these three solid predictors of whether interest rates will rise or fall, or for more great advice for home buyers and owners, please visit LoanLove.com.
Media Contact: Kevin Blue, Blue Loan Services, 949-292-8401, firstname.lastname@example.org
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