Lost in the attention being paid to exactly when and by how much the Federal Reserve will lower the federal funds rate is the fact that interest rates at the far end of the yield curve are already falling. This is due to lower market expectations both for inflation in the long-run and for short-term rates in the near future.
The yield on 10-year U.S. Treasuries, the benchmark long-term interest rate, has trended downward for the last 4 months to just under 4 percent in early September. That is well below the decade-plus highs of last October, when yields were touching 5 percent. Mortgage rates are similarly moving lower. The 30-year fixed rate average fell to 6.4 percent in late August, down nearly 90 basis points from May. Thirty-year mortgage rates were pushing 8 percent last October.
Lower mortgage rates are helping to thaw the frozen housing market. The supply of homes for sale has been hampered by, among other things, a large number of potential sellers who are unwilling to list their homes because they don’t want to give up an existing mortgage at an historically low interest rate. This situation is slowly improving as rates moderate. The number of active residential listings has moved steadily higher this year. At the same time mortgage refinance applications are running at nearly double their pace from this time last year. Refinancing to a lower rate eases household debt service burdens and frees up funds for other uses, a boon to the overall economy.
Of course, lower mortgage rates stimulate demand for homes as well as supply so the impact on housing prices is uncertain. They also won’t by themselves solve one of the economy’s long-standing problems: a housing supply and affordability crisis. But lower rates are certainly a step in the right direction.
Long-Term Rates & Short-Term Relief
Sep 10, 2024
Lost in the attention being paid to exactly when and by how much the Federal Reserve will lower the federal funds rate is the fact that interest rates at the far end of the yield curve are already falling. This is due to lower market expectations… Read the rest
Congress Takes On Nonbank Registry Rule
Sep 04, 2024
Last week, , Representative Andy Ogles (R-TN) introduced a Congressional Review Act (CRA) to the CFPB’s nonbank registry rule related to enforcement. Representative Ogles has been highly supportive of the financial services industry … Read the rest
Featured Business Partner | Allied Solutions
Sep 03, 2024
The featured Business Partner for the month of September is Allied Solutions.
There is power in partnership. Allied Solutions and Securian Financial partner to provide relevant, compliant solutions for consumer and auto finance companies.
Emergency Rule Petitioned
Aug 29, 2024
AFSA’s State Government Affairs team sent a petition for emergency rule or order to the New Hampshire Bank Commissioner regarding NH HB 1243. AFSA has been continuously engaged with the New Hampshire Banking Department throughout the finalization… Read the rest
More CFPB Concerns
Aug 29, 2024
Last week AFSA sent a letter to the CFPB reiterating enforcement concerns with the nonbank registry. As AFSA previously noted, the rule is overly broad and conflicts with a multitude of consumer protections already in place at both the federal… Read the rest
Women’s Equality Day!
Aug 26, 2024
Today, August 26th, AFSA marks the 104th anniversary of Women’s Equality Day and the significant achievement of the 19th Amendment’s ratification. This amendment, passed in 1919 and ratified in August 1920, made an historic… Read the rest
Agency Actions Must Be Limited
Aug 23, 2024
This week, AFSA and other trade organizations filed an amicus brief in support of a vehicle finance company facing an enforcement action from the CFPB, which is attempting to amend settled law that the financial services industry has operated… Read the rest
Back to School Spending and Credit Access
Aug 21, 2024
Back-to-school season is well underway, bringing with it the need for supplies, new clothes, books, and more. According to a National Retail Federation survey, back-to-school outlays for the coming academic year will amount to $39 billion,… Read the rest
Concerns on CFPB’s Medical Debt Rule
Aug 13, 2024
Yesterday, AFSA submitted comments to the CFPB on its proposed rule concerning medical debt. In the letter, AFSA highlighted four specific issues with the proposed rule:
- The CFPB lacks authority for this rulemaking
- At the outset, the CFPB
Industry Expertise | Lien on Me: CHAMP Titles ELT Will Be Your Friend
Aug 12, 2024
“Industry Expertise” is sponsored content produced by AFSA’s Business Partners’ to provide thought leadership and best practices for AFSA member companies. . For more information about this sponsored content opportunity, contact Dan… Read the rest