The Fed is about to cut rates, but here's why it may not lower mortgage rates much

Published On Sep 17, 2024, 5:00 AM

The article discusses the anticipation surrounding an upcoming Federal Reserve interest rate cut and its potential limited impact on mortgage rates. While average mortgage rates have dropped to around 6.2%, experts suggest that further reductions won't be significant immediately after the Fed's decision. The Fed's signaling for future rate cuts, however, has led to hopes for lower borrowing costs, but a disconnect exists between short-term rates set by the Fed and long-term mortgage rates. Previous patterns show that delayed responses in mortgage rates to Fed cuts could occur, and some experts even warn of slight increases in mortgage rates if the Fed's actions do not align with market expectations.