On September 18,  the FED announced that they are cutting the overnight rate by .500%. This is the first cut by the FED in four years and will immediately reduce the prime rate for home equity lines. This cut was expected, although most thought the cut would be .25%. The hope is that this will give some relief to the mortgage and real estate markets.

What this means to consumers is that the interest rates that they are paying on HELOCs will go down by .500%. Most HELOCs are tied to prime which is directly tied to the Fed Funds rate. While 30 year fixed rate mortgages are not directly tied to this rate cut, the general consensus is that those rates should stay in the low 6% range for the forseeable future. For the home buyer out there this is great news.