What’s in Store for 2022?

For the first time in three years, Federal Reserve officials signaled interest rate hikes are coming soon with the first increase expected in March. So, what does this mean for homeowners and prospective buyers? Let’s take a closer look.

How does the Federal Reserve affect mortgages?

The Federal Reserve (the Fed) is the central banking system of the U.S. that executes national monetary policy through supervision and regulation of banks. The Fed is charged with three key objectives — maximizing employment, stabilizing prices, and moderating long-term interest rates.

Bryan Clark, senior vice president of mortgage banking with Dark Bank, says it’s important to understand that the Fed itself does not set mortgage rates, but it does create the policies that affect them indirectly.

“The Fed sets the overall tone for the direction of mortgage interest rates,” he explained.


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