According to Matt Pitcher at Live Oak Capital, agency lenders have begun lowering rates and easing some pressure in the credit markets.
Ending one of the most volatile weeks in U.S. financial history, fixed-interest rates for multi-family and commercial loans fell across the board as agency lenders came down about one-quarter percent and commercial banks pricing off of swaps lowered rates by a similar margin.
Many banks that are exercising extreme caution in the face of liquidity concerns held back on taking new applications or looked to combine their loans. In spite of the approval by the House of the rescue package on Friday, economic worries dominated the market as stocks fell and demand for short-term securities rose, pushing down yields.
The good news is that there is still money available for well-situated and first-rate properties in healthy markets. As swaps have fallen, I've been hearing about rates for three-year loans at below 5.5 percent. I would not use a three-year loan (too short) for our assets, but they exist at that rate for the right properties in the right markets for the right investors.