First few Article Sentences
As an old Chinese proverb says, “Crisis can be used as an opportunity by some.” As the U.S. economy continues to struggle, both long-term fixed and short-term variable interest rates have been very low and may remain low through mid-2013, according to the Federal Open Market Committee. Hospitals looking for flexibility in their funding options may want to consider financing a new project or refinance existing debt with a variable-rate financing structure.
Show Me the Interest Savings
The LIBOR one-month rate and SIFMA indices are the taxable and tax-exempt benchmarks for financing debt with short-term rates. The one-month LIBOR rate, currently at .23% at the time of writing this article, is used to price floating-rate notes and variable-rate mortgages. The SIFMA municipal swap index, now at .15%, is used in remarketing tax-exempt variable-rate demand bonds. Both rates have fallen significantly since 2008.