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Headquarters - Springdale

4055 W. Sunset
Springdale, AR 72762

479-717-1900

MAILING ADDRESS

P. O. Box 6490
Springdale, AR 72766

LOBBY HOURS

Monday thru Friday: 8:00-5:00
Saturday: 9:00-12:00

DRIVE THRU

Monday thru Friday: 7:30-6:00
Saturday: 9:00-12:00

East Springdale

2081 Butterfield Coach Rd.
Springdale, AR 72764

479-717-1992

LOBBY HOURS

Monday thru Friday: 8:00-5:00

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Monday thru Friday: 7:30-6:00

South Springdale

3607 S. Thompson
Springdale, AR 72764

479-717-1991

LOBBY HOURS

Monday thru Friday: 8:00-5:00

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Monday thru Friday: 7:30-6:00

Pinnacle

4901 W. Pauline Whitaker Parkway
Rogers, AR 72758

479-286-2100

LOBBY HOURS

Monday thru Friday: 8:00-5:00
Saturday: 9:00-12:00

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Monday thru Friday: 7:30-6:00
Saturday: 9:00-12:00

Fayetteville

1325 E. Joyce Blvd
Fayetteville, AR 72703

479-717-1990

LOBBY HOURS

Monday thru Friday: 8:00-5:00
Saturday: 9:00-12:00

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Monday thru Friday: 7:30-6:00
Saturday: 9:00-12:00

Bentonville

2904 South Walton Blvd. Bentonville, AR 72712

479-876-8293

LOBBY HOURS

Monday thru Friday: 8:00-5:00

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Monday thru Friday: 7:30-6:00

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Contact Us

Telebank: 1-877-717-4717
Toll Free: 1-877-717-1900 
Main Location: 479-717-1900 

To report a lost or stolen debit card
please call 1-800-472-3272

Mailing Address:
PO Box 6490
Springdale, AR  72766

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Learn   >   3 Ways Federal Interest Rates Affect You

3 Ways Federal Interest Rates Affect You

Unless you have a job related to finance, you probably aren’t closely following the rate changes made by the Federal Reserve. When the news transitions to stories regarding “the Fed,” most tend to drown it out or change the station. However, whether you’re paying attention or not, these rates impact our lives in a variety of ways.

Without getting into an entire econ class, this blog gives you a short overview of the Fed and reasons why you should be paying attention. We’ll also give you a few examples of how decisions made by the Federal Reserve should influence the decisions you make regarding your own personal finances.     

 

Definitions

First off, some definitions are in order. The Federal Reserve System, or “the Federal Reserve” or simply “The Fed” is the central banking system in the United States. The Fed plays a lot of roles, one of which is establishing a target for the federal fund rate to maintain the stability of our financial system.

The federal fund rate is simply the interest rate banks charge other banks for lending money. This rate is also used as a benchmark for a number of customer interest rates. Of course, those are just the basics. There a many aspects to how, why and when these rates are changed. But you don’t have to be a financial wizard to make smart decisions based on the federal fund rate. Here are three examples of how this rate affects your personal finances.

 

Credit Card Rates

The federal fund rate affects short-term interest rates; this can impact the interest paid on credit cards. What most credit cards charge is tied to the prime interest rate, which is about 3-percentage points above the federal funds rate. The Fed will move this rate higher in order to slow down inflation. It’s important to take a look at this number when opening a new credit card account.

 

Home Equity Loans

While the Federal Reserve can indirectly influence mortgages, market forces are the primary driver of mortgages rates. You should consider this when applying for a home loan. However, your home equity line of credit, often called a HELOC, is directly related to the prime rate. When the Fed raises it, HELOC rates increase as well.

 

Auto Loans

In addition to short-term interest rates, the federal funds rate also influences a medium-term fixed loans. This is the type of loan you’d typically get for a car loan. If the Fed increases the federal funds rate, it will increase the prime interest rate, which could cause your lender to offer these loans at a higher rate. The good news is when you agree to a loan with a fixed rate, those rates are locked in forever and can’t be changed. The same is true for student loans and other fixed-rate loans.

 

Key Takeaway

Keeping a close eye on the federal fund rate can give you an idea of when the best time is to get a loan or refinance existing loans. At Legacy National Bank, we take pride in offering the best loan rates in NWA. Come by for a chat at any of our locations to discuss how we can help you make the best decisions for your future.




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