We know the worldwide outbreak of the coronavirus has everyone feeling a bit unsettled; however, there is a famous quote that reads “from tragedy comes great strength”. While we may feel a bit worried about the economy, there are steps we can take during these times to emerge stronger.
Last week, the Federal Reserve said the coronavirus “emerged as a new risk to the global growth outlook”. And Treasuries are backing up that sentiment as the 10-year bond yield tumbled past historic lows to 1.64 last week and has followed that up with a yield of 1.37 this morning. This is a typical benchmark for business as well as variable rate financing.
We know that economic concerns impact the interest rates consumers pay. Because of this, if you have a variable rate business loan or fixed rate loan that can be adjusted, now is the time to speak with your banker.
On the mortgage front, mortgage rates have been declining since early January, falling to 3.49 percent as of last week. Now is a great time for mortgage shopping as average rates for 30-year and 15-year fixed-rate mortgages sit comfortably below the 4 percent mark.
If you currently have an adjustable rate mortgage, you’re likely enjoying the plummet in rates, which results in a lower monthly payment. However, please understand that while rates are at historical lows and could continue to go lower, we advise you to explore the benefit of locking in a rate now by refinancing into a fixed-rate mortgage.
While it may seem puzzling that mortgage rates in the U.S. are affected by the worldwide coronavirus outbreak, it is our job as accountants and business advisors to ensure our clients and friends of the firm are taking advantage of the resulting financial opportunities. We encourage you to reach out to your accountant and/or banker for more information. As always, we are here to help. Please reach out to a member of the Laufer LLP team with any questions by calling
631-226-9600. And be sure to follow us on
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