Fed Delivers Significant 0.50% Rate Cut, Largest Since 2020
Fed Cuts Interest Rates: What It Means For You
Key Takeaways
Significant Rate Cut: The Federal Reserve has lowered its key interest rate by 0.50%, the biggest cut since March 2020.
Former fed funds range: 5.25-5.50%
New range: 4.75-5.0%
Impact on Mortgage Rates: Mortgage rates initially improved but then rose slightly due to revised Fed forecasts for future cuts.
Reason for the Cut: The Fed is aiming to balance inflation and employment, and prevent negative economic impacts of high rates.
Future Rate Cuts: The Fed projects significant rate cuts over the next 16 months.
Should You Buy or Refinance? Current rates are favorable for home buyers. Homeowners with 7.0% + interest rate might consider a low cost loan option to get immediately relief with a rate around 5.75%. Homeowners can refinance to the lowest rates over the next 16 months during the Feds rate cut period.
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