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Mortgage and CD Rates: Opposites That Don't Attract

August 11, 2009

By Andrew Freiburghouse | Money Rates Columnist

If you're looking for the best mortgage rates, you're happy when interest rates go down. If you're looking for the best CD rates, you're sad when interest rates go down.

Money, Dreams, and Other People

One group dreams of of homeowhership while the other grouup dreams of a comfortable retirement. Often, as in the case of the young couple looking for a low mortgage rate and the elderly widow making sure she's getting the best rates on CDs, these two groups are actually different groups.

Different generations, in fact.

Fear of High Interest Rates and Generational Shift

Right now, it seems as if people are more afraid of rising interest rates than they are hoping for them. In other words, the mortage-wanters of America are more vocal (and, frankly, more benefited by government).

Savers don't have as much say.

Over the next decade or so, however, that may change. As America's population grays, secure, fixed interest rate monetary instruments may prove the favored investment of a certain class of senior citizen.

When hoping for either falling or mortage interest rates, it's important to consider the hopes of other Americans as well. The conflict and cooperation that takes place between mortgage-seekers and CD holders is important in the big picture of American finance.

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