US Credit Rating Downgraded but Mortgage Rates Fall

By · August 8, 2011 · Filed in Financial News

The first-ever cut in the US credit rating has initially caused the home loan rate to drop even slightly below last week’s lows. The US credit rating was lowered from an AAA rating to an AA+ with a negative outlook from the Standard and Poor Company. Unfortunately the long term outlook on the mortgage industry is that the down-graded credit rating will cause a jump in rates. If you need a 100% mortgage, we suggest discussing your goals with several experienced lenders.

The Dow Jones industrials fell 634.76 points. It was the sixth worst point decline for the Dow in the last 112 years and the worst one-day drop since December 2008. Every stock in the Standard & Poor’s 500 index declined Monday.  Investors worried about the slowing U.S. economy, escalating debt problems threatening Europe and the prospect that fear in the markets would reinforce it, as it did during the financial crisis in the fall of 2008.

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