3,345,091
Banks will always come out the winners on top of profits above all else.
Even when they are caught doing bad things and fined Millions ... they remain a profit center.
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The Villages Realty
San Jose, CA
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Diana Zaccaro Broker A...
Cocoa Beach, FL
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Carla Freund
Raleigh, NC
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Doug Dawes
Topsfield, MA
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Signature Homes & Estates
Gilroy, CA
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Gary Frimann, CRS, GRI...
Gilroy, CA
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John Juarez
Fremont, CA
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Kathleen Daniels, Prob...
San Jose, CA
2,062,064
Higher rates may hurt their volume, but it does not hurt their profit.
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Diana Zaccaro Broker A...
Cocoa Beach, FL
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Carla Freund
Raleigh, NC
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Doug Dawes
Topsfield, MA
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Karen Climer
Orlando, FL
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John Juarez
Fremont, CA
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Susan Emo
Kingston, ON
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Ryan Huggins - Thousan...
Thousand Oaks, CA
1,311,397
The volume of real estate refinances is way down. Mortgage companies are laying off since there is not enough business to keep the employes profitably employed.
As interest rates rise in the economy (not just mortgage rates), the cost of funds increases for the banks. They work on margins and must increase their rates to maintain their profit margins. It becomes more expensive for their borrows to borrow so loan demand goes down and more layoffs take place. The business borrowers find it too expensive to borrow so they cut back on investment, cut back on expansion, and the lay off employees to try to maintain profits.
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Diana Zaccaro Broker A...
Cocoa Beach, FL
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Doug Dawes
Topsfield, MA
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Gary Frimann, CRS, GRI...
Gilroy, CA
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Ryan Huggins - Thousan...
Thousand Oaks, CA
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Kathleen Daniels, Prob...
San Jose, CA
1,556,633
Good point. But, they'll make it up on the credit card interest, as well as other loans.
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The Villages Realty
San Jose, CA
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Diana Zaccaro Broker A...
Cocoa Beach, FL
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Doug Dawes
Topsfield, MA
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Signature Homes & Estates
Gilroy, CA
1,502,998
And higher interest rates will encourage savings accounts which the banks then use to loan out. Plus ARMs will continue to rise in interest rates, as will HELOCs and other loans.
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Diana Zaccaro Broker A...
Cocoa Beach, FL
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Doug Dawes
Topsfield, MA
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John Juarez
Fremont, CA
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Susan Emo
Kingston, ON
2,781,173
If high rates are supposed to slow down buying and selling, it doesn't address all the hurt the collateral and related businesses are feeling. You would think that win-win solutions would be in place. Despite all this, Real Estate goes on
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Doug Dawes
Topsfield, MA
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John Juarez
Fremont, CA
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Ryan Huggins - Thousan...
Thousand Oaks, CA
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Kathleen Daniels, Prob...
San Jose, CA
1,543,823
Volume may be hurting, but profits per loan - doing fine!
Let's not weep for the banks.
Besides, rates are easing as they do heading into a recession.
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Doug Dawes
Topsfield, MA
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John Juarez
Fremont, CA
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Thomas J. Nelson, REAL...
La Jolla, CA
1,453,069
Higher rates are paid out and collected both. It has zero effect on profits.
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Diana Zaccaro Broker A...
Cocoa Beach, FL
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Doug Dawes
Topsfield, MA
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John Juarez
Fremont, CA
5,216,740
Banks work on a yield spread curve. They always get there cut!
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Diana Zaccaro Broker A...
Cocoa Beach, FL
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Doug Dawes
Topsfield, MA
2,241,554
Local banks in my area are even busier with the hike in lending rates. Folks scrambling to get the lowest equity loan rate are banging on their doors. The slight hike in lending rates made an already full throttle real estate market increase speed. Panic from still not enough inventory and bidding wars has not gone away. The tightening the screws on higher interest home lending interest rates just added more stress to today's bank buying home purchasers Tony Lewis . Our six local bank lenders are doing fine no matter what the rates are. There is always a market and their profit is in their bottom line operating costs like you and I.
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Diana Zaccaro Broker A...
Cocoa Beach, FL
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Doug Dawes
Topsfield, MA
901,535
They will shed excess expenses and still make plenty of money.
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Diana Zaccaro Broker A...
Cocoa Beach, FL
1,196,798
Their profit is not hurt. And if it is I don't feel sorry for them...lol
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Diana Zaccaro Broker A...
Cocoa Beach, FL
6,393,609
378,517