The Fed Cut Rates? Let’s Refi! Not Necessarily…

At the conclusion of their meeting this week, the Federal Open Market Committee (FOMC) reduced the overnight borrowing rate for US banks by another ½%. This was on the heals of a similar move the Fed last week with a reduction of ¾%. For most consumers they will benefit with a reduction to the prime rate to 6.0%. Most Home Equity Lines of Credit (HELOCs) are tied to the prime rate.

But for traditional mortgages, this will not have a direct or immediate impact. There may be other events, trends and opportunities for considering refinancing. But the Fed’s move is not the trigger or reason those opportunities and choices will occur.
To understand why, read Chris Kissell’s article: Smart Mortgage Strategies After the Fed Cut.

“As you listen to news reports about the Federal Reserve’s latest rate cut, Bob Walters would like you to keep one thing in mind…. ‘Ninety percent of the media is getting this dead wrong,’ says Walters, chief economist at Quicken Loans”