Benefits Of The Fed Rate Cut For The Housing Market And Borrowers
This ARTICLE On The Benefits Of The Fed Rate Cut For The Housing Market And Borrowers Was PUBLISHED On August 1st, 2019
Benefits Of The Fed Rate Cut: Federal Reserve Board Chairman Jerome Powell announced on Wednesday, July 31st, 2019 the Feds will be cutting interest rates by 0.25 basis points.
- The news of the Fed Rate Cut was expected for several weeks
- Benefits Of The Fed Rate Cut normally is good for consumers in general
- Many consumers wonder the Benefits Of The Fed Rate Cut for the housing market
- What are the Benefits Of The Fed Rate Cut for home buyers and homeowners thinking of refinancing their mortgage?
- The move yesterday by the Federal Reserve Board marked the first time the Feds cut interest rates since the 2008 Great Recession and Housing Collapse
In this article, we will discuss and cover the Benefits Of The Fed Rate Cut. How does this affect the housing market? Will the Benefits Of The Fed Rate Cut further lower interest rates in the coming months? Will the Feds continue to cut interest rates going forward?
News Of The Feds Interest Cut
- The announcement was expected
- The interest rate cut by the Federal Reserve Board is the first cut since the Great Recession of 2008
- There are mixed emotions of the news by industry experts and economists on the impact and benefits of the Fed Rate Cut and its impact on mortgage rates and the housing markets
- In general, there are many benefits when the Feds cut rates. Rate cuts normally yield lower mortgage rates
- The 25 basis point rate cut will drop interest rates from 2.25% to 2.5% to 2.0% to 2.25%
- The Federal Reserve Board announced earlier this year they will not increase interest rates
- In 2018, the Federal Reserve Board had four interest rate hikes
- There were talks the Fed will be cutting interest rates for many weeks
After raising interest rates last year, economic growth has seen a slowdown. However, inflation remained the same. The U.S. Labor markets are still strong with historic record unemployment numbers.
Carlucci feels the interest rate cut on Wednesday, July 31st, 2019 will benefit mortgage borrowers. He strongly believes mortgage rates will drop in the coming months into 2020.
Anticipation Of Lower Mortgage Rates
Mortgage rates remained unchanged on Wednesday after the news of the 25 basis points rate cut.
- This is because the mortgage markets were already expecting the news by Fed Chairman Jerome Powell
- Further hints by Chairman Powell need to be leaked out about the Feds further decreasing interest rates for the mortgage markets to have an impact
Benefits Of The Fed Rate Cut: The Bottom Line
Mortgage rates today are at a 3 year low. Back in 2013, rates on 30 year fixed rate mortgages were as low as 3.25%. Borrowers who closed on their mortgages in 2018 got rates at an all-time high since the 2008 Great Recession. The Federal Reserve Board increased rates four times in 2018. Many borrowers closed their home loans at over 5%. Today’s mortgage rates are at 3.75% for prime borrowers without any Loan Level Pricing Adjustments (LLPA). Most borrowers who closed on their home loans in 2018 should get a net tangible benefit by refinancing their home loans today. For more information about this article and/or other mortgage-related topics, please contact us at Gustan Cho Associates at 800-900-8569 or text us for a faster response. Or email us at gcho@gustancho.com. The Team at Gustan Cho Associates Mortgage Group is available 7 days a week, evenings, weekends, and holidays.
