How To Maximize The Interest Rate Drop...

...as Fed Chair Jerome Powell threw us a cuverball this week

rates were lowered .25% at the October 28-29 FOMC meeting

which was largely expected to happen

what surprised many economists

is the forecast that a rate drop at the December 9-10 meeting

is no longer guaranteed due uncertainty caused by the 30+ day government shutdown

scanning the financials this morning shows the average rate is about 6.125%

down slightly from 6.19% last week as markets were pricing in the Fed drop

something that I have consistently predicted since the last Fed Meeting

and if a home mortage rate shopper was trying to time the market

there are 2 scenarios that will play out over the next 6 weeks

The Fed holds rates at the December Meeting:

rates will hover between 6.125%-6.25%

The Fed lowers rates by .25% at the December Meeting:

rates will hover between 5.875%-6%

My prediction is that the government will reopen next week

• military pay and SNAP benefits are running out of funds rapidly
• key elections on November 4 will be over
• public pressure will reach a boiling point

and that will lead to a rate reduction in December

and rates will dip below 6% to 5.875% as I have talked about for over a year

the question for consumers remains

will a .125% rate difference keep you on the sidelines?

or have we reached the magical number on rates to move forward?

tune in to today's podcast for all of the nitty gritty details