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Mortgage Opportunities from Record Rate Cut

Late yesterday (Tuesday) afternoon, the Federal Reserve slashed its target for the overnight federal funds rate to a range of 0 to 0.25 percent. That may sound like meaningless gobbledygook, but it’s not. It’s an all-time record low.

Okay, in theory the change only affects the rate at which banks lend money to each other. But in reality it’s pretty much certain to have an immeasurable knock-on effect on the wider economy.

Yes, we all know that mortgage lenders can often be frustratingly slow in passing on rate cuts to borrowers. But yesterday’s new figure is likely to put irresistible downward pressure on mortgage rates. And we might very reasonably expect to see the cost of home loans spiralling down sometime very soon.

All this just adds weight to the tip I gave on Monday. Real estate prices are low. Mortgage rates will soon be significantly lower. Now is the time to buy.

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