The Federal Reserve has had a dramatic year. The U.S. Central Bank announced Wednesday that it will not be changing interest rates again this year, and it looks like they might hold steady in 2020, as well.

Fed Rate Changes in 2019

The federal funds rate was raised nine times in three years. The last increase was about a year ago during a time when financial markets were really struggling. This year, the trade war with China and other factors led them to change course and cut the rate three times in the past five months. Some financial experts expected the latest Fed meeting to result in another change, but they decided to keep things as they are for the foreseeable future.

This year’s Fed rate cuts have definitely impacted consumers in terms of credit card rates, savings interest and, of course, mortgage interest rates. Obviously, we’re closely studying the impact on mortgage rates because it affects us and our clients.

How the Fed Rate Affects Mortgage Interest Rates

The Fed rate, along with the overall economy and inflation, all have some influence when it comes to long-term fixed mortgage rates. Mostly, they are driven by yields on U.S. Treasury notes. With the Fed cuts this year, mortgage rates have mostly stayed down in 2019. The last Fed rate cut actually led to a slight bump in mortgage rates. However, they are still substantially lower now than the same time last year. On average, mortgage rates are a full percentage point lower according to Bankrate, dropping from 4.9% last year down to 3.9% this currently.

For homeowners who bought last year, now is the time to consider refinancing their mortgage loan. When you have a 30-year fixed rate loan, you benefit from refinancing when the available rates are significantly lower. The average homeowner can save about $150 a month if dropping a whole point in interest.

What it Means for Consumers

Home refinances have been very popular for us at Transparent Mortgage this year as interest rates have stayed fairly low and home values are still up. It doesn’t seem there will be any Fed rate hikes any time soon, and more rate cuts might be too drastic a shift in the opposite direction. For now, the Federal Reserve is holding ground. If you can get a lower rate on your new home loan, home refinance, credit card balance transfer or any consumer debt, now is the time to act and take advantage of current market conditions.

For all your mortgage lending needs in San Diego and Southern California, the team at Transparent Mortgage is here to help with the information and guidance you need to make sound mortgage decisions. Call us today at (619) 701-3906 or email me personally at