504 April 2017 Rates |
4.625% – 20 Year Debenture Effective Rate * |
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De-risking an uncertain rate environment
In recent newsletters we have discussed potential risks to a smooth slow upward glide path on the Federal Reserve’s stated intention to return the economy to a more normal rate environment. Without even going to the political arena, where nothing seems more certain than utter uncertainty, these risks include: incipient signs of inflation, possible dollar weakness, and the beginning of the unwinding of the Fed’s ex post QE I-III balance sheet.
Chart and Statistical Data is from September 2006 to April 2017
The recent twenty year debenture auction produced a slight, if welcome, decline in the all-in rate. However, as we have been at pains to note, there is profound uncertainty as to the likelihood of a slow and steady path forward. As lenders, we are inherently in the business of risk management. Why not take the prudent course, for both ourselves and our borrowers, and de-risk the interest rate environment? The long term fixed rates of the 504 program combined with the capacity to preserve working capital through a low equity injection, meets this need.
We welcome the opportunity to earn your business. * Note: Rates are subject to credit determination & auction pricing. Past performance is no guarantee of future results. Share this message with the tools below. |
