Interest Rates Are Close to Zero. Is Now the Time to Finance a New HVAC System? - Parker & Sons

Mortgage rates are the lowest they’ve ever been in history, and the Federal Reserve has purposely lowered interest rates to get more money in our pockets. Does that mean now is the time to buy, buy, buy?


First of all, you might be wondering, “Why are interest rates low right now?” And even more importantly, are there any consequences to artificially lowering them? Could making a big purchase on credit right now backfire on you?

If you’re wondering what is going on here, it all starts with the Federal Reserve, which is essentially our central bank that is allowed to “pick” the interest rate. Usually, interest rates keep climbing and climbing higher over time in order to follow inflation, but in current times, it makes more sense to try and boost the economy by encouraging consumers to make purchases. So, the Federal Reserve is keeping interest rates low in the hopes that people will be interested in taking out credit cards, buying a house or a car, or other large purchases. But is now a risky time to do that?

In short: no!

Even though it’s an uncertain time in the world right now, you don’t have to be worried about future interest rates / inflation, if you make a purchase on credit now. That is true for two reasons: for one, if you take advantage of the current low interest rates, you are locked into that rate, even if interest rates go up. The second reason is that interest rates are expected to stay low or even at zero for a while. Although, this comment from Quincy Crosby of Prudential Financial doesn’t exactly inspire confidence that interest rates are going to stay low:

“The answer is, we don’t know nor does the Fed know. They just know what they want to see.”[1]

So for that reason, we DO recommend jumping on low interest rates sooner rather than later — as long as you have your own ducks in a row to do that:

Are you ready?

Don’t rush into a major purchase without thinking through your own financial situation. You know that interest rates depend on such factors as your current credit score, your ability to find a trustworthy cosigner on a loan, and even how much savings you currently have, when it comes to whether or not lenders are willing to lower your interest rate.

How we can help

If one of the purchases you’re planning on making for your Phoenix home is an HVAC system, Parker and Sons will work with you to make financing as easy as possible. We can help you no matter your budget, and can help you find the right lender. Call us at (602) 273-7247 or contact us online, and we can help you today!

[1] CNBC

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