Understanding SOFR and Its Relationship with Fed Funds Rate in Mortgage Lending

While the Federal Reserve's rate hikes typically make mortgages more expensive, other market factors can sometimes lead to cheaper borrowing even during these hikes. One stable factor is the Secured Overnight Financing Rate (SOFR), which closely tracks the Fed funds rate but tends to be slightly lower. Currently, the Fed funds rate is 4.5-4.75%, while SOFR is at 4.3%. As the Fed raised rates by 25 basis points last week, SOFR is expected to rise by a similar amount.

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Видео Understanding SOFR and Its Relationship with Fed Funds Rate in Mortgage Lending канала Scalable Real Estate Investing with Mason Klement