US Fed Lowers Rate to 1 percent

The US Federal Reserve has just matched a half-century low... they have lowered their interest rate by a half-point to 1.0%, in an effort to settle the current economic crisis. The funds rate has not been lower since 1958, when Dwight Eisenhower was president.

The Fed also stated that they would "monitor economic and financial developments carefully and will act as needed to promote sustainable economic growth and price stability."

What does all of this mean for the real estate industry? Share your thoughts.

Gina Burgio, Mortgage Agent
VERICO Designer Mortgages Inc.
Toll Free: 1-877-345-6265
Fax: 1-877-345-6256
Email: gina@ginaburgio.com
www.ginaburgio.com

Each VERICO Broker is an independent owner operator.

Iceland Raises Interest Rates to a record 18 percent

Iceland raised interest rates to a record 18 per cent from 12 per cent yesterday as a condition of a proposed $2bn loan from the International Monetary Fund to help rescue the stricken country.

Iceland applied for the emergency loan after its banking system collapsed and is seeking another $4billion from other central banks.

Following the collapse of their banking system, some economists forecast that Iceland's economy unemployment to rise around 8 percent and inflation to hit 20 percent or more.

Despite the ongoing crisis in the US and Canada, things could be worst.... when you look at what's going on in Iceland!

Gina Burgio, Mortgage Agent
VERICO Designer Mortgages Inc.
Toll Free: 1-877-345-6265
Fax: 1-877-345-6256
Email: gina@ginaburgio.com
www.ginaburgio.com

Each VERICO Broker is an independent owner operator.

Mortgage Rates

Gina Burgio, Mortgage Agent
VERICO Designer Mortgages Inc.
Toll Free: 1-877-345-6265
Fax: 1-877-345-6256
Email: gina@ginaburgio.com
www.ginaburgio.com

Each VERICO Broker is an independent owner operator.

Cdn Gov't to Purchase up to $7.0 Billion of Mortgages

The Canadian Gov't announced today that they will, via their CMHC crown corporation, purchase up to $7billion of insured mortgage-based securities maturing in 2013.

The gov't purchased their first round of mortgages worth $5billion last Thursday.

This is forming part of the Cdn gov't $25billion plan to help banks weather the credit crisis and free up cash for lending.


Gina Burgio, Mortgage Agent
VERICO Designer Mortgages Inc.
Toll Free: 1-877-345-6265
Fax: 1-877-345-6256
Email: gina@ginaburgio.com
www.ginaburgio.com


Each VERICO Broker is an independent owner operator.

Canadian Banks are Not Expected to Adjust Prime Rates

Many economists in Canada are expecting the Canadian Banks to hold their Prime Rates, despite the Bank of Canada decision today to drop the overnight lending rate by a quarter point to 2.25%.

The Canadian Banks earlier this month followed a similar trend when the Bank of Canada lowered their rate to 2.50% and the Banks did not pass on the full extent of the cut when the Banks lowered their Prime Rates at that time.


Some economists forecast that the Bank of Canada will lower their overnight lending rate to 2.00% by year-end.


Prime Rates are used as a benchmark to set most consumer loan rates in Canada, such as mortgages and lines of credit. Unlike Canada, many US banks peg mortgage rates off LIBOR, the rate on inter-bank borrowing. That means US banks can match a central bank cut and drop prime rate with little impact on the profitability of their consumer loan portfolios.





Gina Burgio, Mortgage Agent
VERICO Designer Mortgages Inc.
Toll Free: 1-877-345-6265
Fax: 1-877-345-6256
Email: gina@ginaburgio.com
http://www.ginaburgio.com/









Each VERICO Broker is an independent owner operator.

Bank of Canada Lowers Rate to 2.25 percent

The Canadian Central Bank cut rates today by a quarter point to 2.25%.

This rate cut today by the Bank of Canada was left than the half point cut expected by some economists. The reaction to this was also seen by the Canadian Dollar... falling to a three-year low following today's announcement.

It will be interesting to see how various Canadian financial institutions react today to the news... in terms of their prime rates and mortgage rates.

The Central Bank commented however that it would likely have to lower rates further to combat the effects of the global financial crisis. "In line with the new outlook, some further monetary stimulus will likely be required to achieve the 2 percent inflation target over the medium term," the central bank said in a statement announcing the lowest overnight lending rate since September 2004.

The Bank of Canada also commented on the US Recession, stating, "The global economy appears to be heading into a mild recession, led by a US economy already in recession."



Gina Burgio, Mortgage Agent
VERICO Designer Mortgages Inc.
Toll Free: 1-877-345-6265
Fax: 1-877-345-6256
Email: gina@ginaburgio.com
http://www.ginaburgio.com/

Each VERICO Broker is an independent owner operator.

Canadian Central Bank Expected to Lower Rates

The Bank of Canada is expected to lower its overnight lending rate by as much as a 0.50% tomorrow. If so, this will be the second time in two weeks that the Bank of Canada has taken action to lower rates as part of its efforts to help tame the global financial crisis.


Their overnight rate influences the prime lending rates charged by the chartered banks in Canada. It can affect borrowing costs on variable-rate mortgages and lines of credit.
It will be interesting to see how the Banks react.


The last time the Bank of Canada announced a half-point cut on Oct8, not all the chartered banks passed on the full effect to customers.


Gina Burgio, Mortgage Agent
VERICO Designer Mortgages Inc.
Toll Free: 1-877-345-6265
Fax: 1-877-345-6256
Email: gina@ginaburgio.com
http://www.ginaburgio.com/





Each VERICO Broker is an independent owner operator.