Last week, The Federal Reserve lowered its benchmark interest rate for the first time since 2008 — a decision which led analysts to believe that this would be the beginning of a new cycle of rate cuts to strengthen the U.S. economy amid slowing global growth.
In a press conference Wednesday following the announcement of the cut — a quarter of a percentage point to around 2.25% — Chairman of the Federal Reserve, Jerome Powell, put these rumors to rest by suggesting that the central bank was not committed to continuing to lower interest rates:
“We see this more of a mid-cycle adjustment than the start of a rate cutting cycle,” Powell said, reiterating that the U.S. economy was still quite strong, but that global growth was weakening faster than they had originally projected.
President Trump, who wants lower rates, is likely to continue his push for more cuts. “As usual, Powell let us down,” the president Tweeted last week.
What the Fed’s quarter point cut means for borrowers is that there is now a larger portion of the homeowner population that would benefit from refinancing their mortgages.
Those with credit cards, home equity lines, or personal loans tied to high interest rates can now consolidate their debt into one low monthly payment. Furthermore, anyone who has either bought a new home or refinanced their loan within the last 2 years, likely has a higher interest rate on their mortgage than what is available in today’s market.
Homeowner’s with FHA loans should ask their loan officer about an FHA Streamline. One of the most popular products today, this allows borrowers to refinance their FHA loans without the cost of an appraisal, and potentially get a refund on their mortgage insurance!
If the Federal Reserve is not committed to lowering rates in the near future, this could be a short window of low interest rates that homeowners cannot afford to miss out on.
Luckily, we at Fellowship Home Loans give everyone a FREE consultation. As a mortgage company built on the values of Honesty and Integrity, we will always be the first one to tell you whether there is a benefit or not.
Call us today to find out how much you can save!
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