What is Prime Rate?

During the foreclosure crisis, the term “Sub-Prime Mortgage Loans” became popularized when discussing the rise in foreclosed homes across the nation. In order to understand a sub-prime mortgage, you must first understand what the prime rate is and how it impacts your mortgage. Also known as the Prime Lending Rate, the prime rate is the interest rate banks charge to their most financially stable and trustworthy customers. Typically, the prime rate is a point of reference for all customers applying for a mortgage.

Your interest rate on your mortgage can play a large role in your financial future. If you or someone you know is facing financial difficulty and possibly foreclosure, you should know that you have options. For more information about how you can protect your home, contact the Boca Raton foreclosure defense lawyers of Eric N. Klein & Associates, P.A., today at 561-353-2800.

Understanding Prime Rate

After reaching 8.25 percent for 15 straight months between the months of July 2006 to September 2007, the prime rate in the United States has stayed at 3.25 percent for the past three years. The prime rate is usually the same amongst all major banks and is also adjusted at the same time.

Banks as well as financial publications may also refer to the prime rate as the “Reference Rate” or “Base Lending Rate.” As a point of reference, the Prime Lending Rate is also roughly three percentage points higher than the federal funds rate.

Contact Us

To discuss how the prime rate impacts your mortgage or to talk about how you can keep your home and avoid foreclosure, contact the Boca Raton foreclosure defense lawyers of Eric N. Klein & Associates, P.A., at 561-353-2800 today.