Yesterday the Federal Reserve cut the federal funds rate by .50%, bringing it to a range of 1-1.25%. This was done in an effort to stay ahead of the potential disruptions and economic slow-down created by the Coronavirus (COVID-19). While the virus has had a mostly negative impact on the stock market, it has given us a bright spot – lower interest rates.
Typically, in times of market weakness, investors favor safer investments – like bonds. As bond purchases increase, interest rates decline, which has a direct effect on mortgage rates.
The Fed Cut and Your Mortgage Rate
Lower rates are great if you are looking to get a mortgage, or if you are able to refinance an existing one. According to bankrate.com, we are seeing 15-year and 30-year mortgage rates as low as 2.875% and 3.25%, respectively (depending on your credit score).
We wanted to take this time to make you aware, as now is a great time to talk to your mortgage broker about potentially refinancing.
As always, if you have any questions, please do not hesitate to contact us!