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| I agree interest rates have many more moving parts than just the fed rate. Maybe it starts at the fed rate but then there is what the market will bare and the risk in lending that come into play. Many lenders are looking for much higher downpayments before they will lend money on land to avoid being significantly under collateralized during the loan duration. I've heard loans up to $6K and maybe $9K if you have other collateral to throw at it. To me there comes a point where the lender still wants to loan the money, but faces too much risk to loan a significant portion of the sale price. The answer is higher interest to cover that risk. | |
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It IS Different this Time.
