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Fed Funds Rate Services in Birmingham, Huntsville & Mobile

The Fed sets the federal funds rate. This is an interest rate applied to money that banks and other depository institutions lend to each other overnight. For more than 20 years now, Weber Mortgage has been the most reliable mortgage company to provide services concerning the fed funds rate in BirminghamHuntsvilleMontgomery, and other Alabama cities within our service area.

Weber Mortgage has been operating since 1999 and has earned quite a respected place among the clients. Our experts offer superior home loan rates and services for VA, FHA, conventional, non-qualifying, and other types of home loans. From the first contact to the final closing, your biggest investment is our priority. We make your home loan process clear and straightforward.

Fed Funds Rate & Usage by Weber Mortgage

Fed Funds Rate & Its Usage
  • What does it mean? Fed Funds Rate is the interest rate at which banks and other depository institutions lend money to each other, usually on an overnight basis. The law requires banks to keep a certain percentage of their customer's money on reserve, where the banks earn no interest on it. Consequently, banks try to stay as close to the reserve limit as possible without going under it, lending money back and forth to maintain the proper level.
  • How is it used? Like the federal discount rate, the federal funds rate is used to control the supply of available funds and hence, inflation and other interest rates. Raising the rate makes it more expensive to borrow. That lowers the supply of available money, which increases the short-term interest rates and helps keep inflation in check. Lowering the rate has the opposite effect, bringing short-term interest rates down.
Fed Funds Rate Decisions Mean for Mortgages

What Do Fed Funds Rate Decisions Mean for Home Mortgages?

The fed funds rate affects short-term loans, such as credit card debt and adjustable-rate mortgages, which, unlike conventional fixed-rate mortgages, have a floating interest rate that goes up and down with the market on a monthly basis. Long-term rates for fixed-rate mortgages are generally not affected by changes in the federal funds rate.

If the central bank wanted to reduce rates again to stimulate the economy, it would have to push rates into negative territory, a move that the Fed chairman Powell has said is not being contemplated.

Choose Weber Mortgage to Fund Your Mortgage in Mobile, Bessemer, & Birmingham

It’s human nature to build a family and acquire as much home as possible for your growing family. Weber Mortgage is a family-owned company that will help you find the dream home that fits your budget because of our ability to understand and use the fed funds rate to your advantage. When you need our help in MobileBessemerJacksonville, and other Alabama cities that we serve, be sure to contact us today or call us at 205-751-8583 to take the first step in making your dream home a reality.