Short term rates are controlled by the Federal Reserve but longer term rates that influence mortgage rates are driven by the market. The best gauge of what will happen to interest rates today and going forward is to watch the Bond market and particullarly the 10 Year Treasury Note. Having said that, short term events can also impact mortgage rates such as volatility in the stock market. A flight to quality from stocks to bonds pushes up bond prices with yields moving in the opposite direction resulting in lower mortgage rates. It will be interesting to see what happens in the coming days and weeks.
Keep in mind, lenders have been crying poor mouth for the last 6 months, so they need to make some of that up and they need some profit on top of that ... .. what the heck, we're only the consumers for goodness sakes.
Yes, I saw the .5% change and now I just have to wait for some mortgage change, if any. I'd need it lower for my refi to make sense. I'll be keeping my eyes on it for the coming days/weeks. I know the unemployment data should be coming out this Friday and that could have an impact as well (independent of the Fed cut today, but still).
Thanks again for the input today!
Until now I was thinking .25 point. However I am now thinking a .50 point.
I don`t know what to expect on the Mortgage side. It really can go either way.
If you can lock in a 30 year fixed at or below 5.25% in the next few weeks, take it. With reasonable closing cost.
Talk with you loan officer about how much a .25 on your interest rate ( 5.00% vs. 5.25% ) will actually effect your monthly payment.
What a great time to be not only shopping for a great deal on a home but also getting phenomenal terms on financing. Best wishes with your home purchase! - Ted