The headline isn't your payment
Does the Fed's rate set my mortgage rate?
No. The Fed's rate is a target for short-term borrowing between banks. Mortgage rates follow longer-term markets. The two are connected, but they don't move point for point. When the Fed moves, your mortgage rate might move more, less, or not at all. What counts for you is today's quote.
Quick answers
“The news says the Fed cut rates.”
That's the rate banks charge each other overnight. A home loan is priced off longer-term markets.
“So rates are lower now?”
Maybe. Ask for today's quote, not a quarter point off yesterday's.
“Should we wait?”
Nobody can promise where rates go. Ask what your payment is today, and what would change it.
Questions people ask
If the Fed cuts rates, will my mortgage rate drop?
Maybe, maybe not. Mortgage rates follow longer-term markets. Sometimes they fall before the Fed moves, and sometimes they rise after a cut.
Should I wait for the Fed before I buy?
Nobody can promise where rates go. Ask what your payment is today, and what your options are. A seller can sometimes pay to lower your payment for the first few years.
Source: Federal Reserve: The policy rate
Get today's quote
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The application takes about 15 minutes, on the secure site we use. Do what you can, and your loan officer calls to fill in the rest.
Prefer to meet in person? Our main office is in Tustin, by appointment.