Here are some of the key takeaways from the Federal Reserve meeting this week and how they may impact the mortgage market:
Fed keeps the rates the same. This was expected. The Fed kept the federal funds rates at their current level, showing they are taking a cautious approach due to uncertainty in the market.
The economic news was mixed. While we saw strong job growth in April (177,000 new jobs in the BLS jobs report), the overall economy shrank by 0.3% in the first quarter. This could be a sign that things are slowing down, which could lead to both higher prices and lower growth.
Mortgage rates are steady. The 30 year fixed mortgage rate has stayed about the same. This is partly because people expect rates to eventually go down if the economy continues to weaken.
Looking ahead: Don’t expect to see big drops in mortgage rates in the short term, but we could see lower rates later in 2025 if the economy keeps slowing down.
So while lower rates may not be on the immediate horizon, it shouldn’t stop you from considering buying a home. There are options to lower your rate from a temporary buydown to paying points to lower your rate. Remember if rates do come down, you can always refinance and we have the Buy Now Refi Later program to help with your refinance.
Leslie Vanderwerf, NMLS ID#335509, CrossCountry Mortgage LLC, An Equal Housing Lender, NMLS#3029 – Email – Website
