Loan Modifications Helped by Fed Cuts

Maybe you've heard of the following concept and maybe not. One of the modifications we're able to get done for you is what's called a Short Refinance. Simply put, you're given a new loan at a payment that you can reasonably afford. Lenders don't even let you know that this option exists. And even if you ask, they do everything they can to keep you out of the loop enough not to know how to get it.

Our attorneys have successfully conducted several of these short refinances and can do one for you too. Just call 800-765-3150 x111

Did you know the Fed cut the rate by .50%. This is good for people who are in need of loan modifications because it eases the pain that the lenders are feeling when having to do modifications. Granted the cut does not tie directly to the long term rates like mortgages do but it is a trickle down effect that will make a modification more bearable for the lender and easier to get for you.

Here's the Fed Cut Details.

The Federal Open Market Committee reduced its target for the federal funds rate by 50 basis points to 1.0% today, matching market expectations for monetary policy. The discount rate was also cut by the same amount to 1.25%. The rate cut today follows an emergency, inter-meeting half point rate cut earlier this month. This is the lowest fed funds target set by the FOMC since June 2004. The policy statement released after the meeting indicated clearly that weakened economic activity brought on by reduced spending and tight credit was at cause for the easing. The Fed noted declining prices and expects inflation to moderate further from here, essentially taking it off the table for now in terms of monetary policy. That leaves the many downside risks to economic growth for the Fed to contend with, indicating perhaps there is more easing in the pipeline when the Committee meets again in December.

Federal Open Market Committee Policy Statement

(Italics/highlight indicate material changes in wording from last statement) Release Date: October 29, 2008

For immediate release

The Federal Open Market Committee has decided today to lower its target for the federal funds rate 50 basis points to 1 percent.

The pace of economic activity appears to have slowed markedly, owing importantly to a decline in consumer expenditures. Business equipment spending and industrial production have weakened in recent months, and slowing economic activity in many foreign economies is damping the prospects for U.S. exports. Moreover the intensification of financial market turmoil is likely to exert additional restraint on spending, partly by further reducing the ability of households and businesses to obtain credit.

In light of the declines in the prices of energy and other commodities and the weaker prospects for economic activity, the Committee expects inflation to moderate in coming quarters to levels consistent with price stability.

Recent policy actions including today’s rate reduction, coordinated interest rate cuts by central banks, extraordinary liquidity measures, and official steps to strengthen financial systems, should help over time to improve credit conditions and promote a return to moderate economic growth. Nevertheless, downside risks to growth remain. The Committee will monitor economic and financial developments carefully and will act as needed to promote sustainable economic growth and price stability.

Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Timothy F. Geithner, Vice Chairman; Elizabeth A Duke: Richard W. Fisher ; Donald L. Kohn; Randall S. Kroszner; Sandra Pinalto; Charles I. Plosser; Gary H. Stern; and Kevin M. Warsh.

In a related action, the Board of Governors unanimously approved a 50-basis-point decrease in the discount rate to 1-1/4 percent. In taking this action, the Board approved the submitted request by the Board of Directors of the Federal Reserve Bank of Boston, New York, Cleveland and San Francisco.