The discrepancy illustrates an unusual situation in the economy. During the period of historically low rates during the pandemic, millions of homeowners refinanced or took out mortgages below 4%. Now, after several hikes by the Fed, borrowing costs have surged to nearly 7% for a 30-year, fixed rate loan. Homeowners are reluctant to move and give that up, fueling an acute shortage of available homes.
| less than a minute read
Rates on savings accounts are higher than millions of mortgages
High-yield accounts generally move in line with the Fed’s benchmark interest rate, which is currently at a 22-year-high. At their July meeting, policymakers left open the possibility of future hikes, depending on economic data.
