Interest rates continued to climb this morning following President Biden's signing of the American Rescue Plan yesterday. The massive $1.9 trillion COVID-19 economic relief package combined with the expanding vaccine rollout and declining new cases in the U.S. has brought optimism on the economic front. Massive fiscal stimulus passed along with pent up demand associated with the pandemic – which just marked its one-year anniversary in the U.S. – is spurring talks of inflation. Indeed, Fed Chairman Powell said that he expects some inflationary pressures as the economy reopens.

Interest rates were anticipated to stay at historic low levels so long as the pandemic continued to run rampant, but the vaccine rollout and its high effectiveness has brought a sense of calm. The nation’s mood has shifted: there’s light ahead, the worst is behind us, and we’re seeing that now play out in the markets. The yield on The US 10 Yr is now up approximately 70 basis points over the past 2 months and at its highest level in more than a year. It would be even higher if not for the Fed’s ongoing commitment to keep buying bonds until the economy fully recovers.

Interest rates on FHA commercial loans are significantly higher since our last update in late December. Expect some interest rate volatility as the economy begins to reopen. Check out today’s rates.

FHA Commercial Loan Rate Update – March 12, 2021

• 35-year fixed FHA perm loans: 2.50%-2.75%
• 40-year fixed FHA construction/perm loans: 3.20%-3.45% 

These pricing indications are current as of the date posted, subject to market interest rate volatility.  Pricing of FHA insured apartment and healthcare loans may be dependent on loan size and other risk factors. Call for more information.

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