Understanding the Factors That Influence Mortgage Interest Rates
Understanding the Factors That Influence Mortgage Interest Rates in Phoenix, AZ Introduction When shopping for a home in Phoenix, AZ, one of the most crucial factors influencing affordability is the mortgage interest rate . Mortgage rates fluctuate due to a variety of economic, personal, and market-driven factors, which can significantly impact your monthly payment and the overall cost of your home loan. This guide explores the primary factors that influence mortgage interest rates in Phoenix so you can better understand how to secure the best rate possible for your home purchase. 1. National and Local Economic Conditions Mortgage rates are heavily influenced by broader economic conditions , including inflation, the Federal Reserve's monetary policy, and overall economic growth. Inflation : When inflation rises, lenders increase interest rates to compensate for the declining purchasing power of money. Federal Reserve Policy : The Fed does not directly set mortgage rates, but it...
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