The Fed provided a 1/2 point interest rate cut on September 18, 2024.
This is welcome large drop after a continued pause, as we saw in March 2024, May 2024 and June 2024 Federal Reserve meetings.
Most economists expected a 25 basis point drop, so this 50 basis point drop is a huge step.
The Federal Reserve Chair, Jerome Powell, expects to make another cut later this year, with policymakers thinking that too, will be in the 50 basis point range, with another point being cut in 2025, according to a Reuters article on the matter.
I have mentioned before how mortgage interest rates are determined by many factors. The Fed’s decisions on interest rate hikes or cuts can be one of the factors, but it is generally a small portion. Another lender I work with says that mortgage companies generally anticipate when the Fed will raise or drop rates, so mortgage rates and terms usually already reflect any potential upcoming pause, hike or cut beforehand. With this larger-than-expected cut, I will be interested to see what happens with Baltimore mortgage rates.
If you are thinking about buying a home in Towson, Timonium, or the Greater Baltimore area, please contact me. I can connect you with a local trusted mortgage professional who can help to guide you through your mortgage options as your buy your new Towson home with me!
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