{"id":178436,"date":"2025-09-24T11:33:19","date_gmt":"2025-09-24T11:33:19","guid":{"rendered":"https:\/\/www.newsbeep.com\/us\/178436\/"},"modified":"2025-09-24T11:33:19","modified_gmt":"2025-09-24T11:33:19","slug":"dave-ramsey-weighs-in-on-fed-interest-rate-cut-for-homeowners-its-good-news","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us\/178436\/","title":{"rendered":"Dave Ramsey Weighs In on Fed Interest Rate Cut for Homeowners: It\u2019s \u2018Good News\u2019"},"content":{"rendered":"

On Sept. 17, the Fed announced its first rate cut<\/a> since the end of 2024, lowering rates by a quarter percentage point, to a range of 4% to 4.25%.<\/p>\n

The news immediately sparked big questions: Will mortgage rates<\/a> go down? Should I buy a home<\/a> or stay put?<\/p>\n

Personal finance author and radio host Dave Ramsey didn\u2019t hesitate to weigh in. In a recent email ne<\/a>w<\/a>sletter to The Street<\/a>, he encouraged buyers to move forward\u2014though with a few important caveats.<\/p>\n

\u201cGood news! There\u2019s still hope,\u201d Ramsey wrote<\/a>, before reminding his readers that, in truth, it matters less what the “market does” and more what prospective buyers do about their finances to get into a home.<\/p>\n

Rates are only a small piece of the puzzle<\/p>\n

\u201cThis is still a great time to buy a house,\u201d Ramsey said after reviewing the recent rate changes<\/a>. Though, he cautioned that mortgage rates shouldn\u2019t be the only factor driving the decision.<\/p>\n

\u201cBe careful not to base your homebuying decision only on rates,\u201d he warned, even as he acknowledged the encouraging news.<\/p>\n

Ramsey reminded readers that the real key to homeownership is financial readiness\u2014far more important than trying to time the market. After all, any dip in mortgage rates isn\u2019t expected to be dramatic.<\/p>\n

\u201cYes, it\u2019s likely mortgage rates will dip a little more in 2025,\u201d he wrote. \u201cBut don\u2019t expect a big drop. The Federal Reserve has projected only minor changes to the federal funds rate, which\u2014while not directly tied to mortgage rates\u2014still plays a big role in how they move.\u201d<\/p>\n

His review of recent projections puts the federal funds rate at around 3.6% by the end of 2025.<\/p>\n

\u201cKeep in mind, 3.6% doesn\u2019t mean mortgage rates will go that low,” Ramsey added. “Mortgage rates are usually 1 to 3 percentage points higher.\u201d<\/p>\n

Ultimately, Ramsey stuck to his evergreen advice: Hold off on buying if you still have debt, lack a fully funded emergency fund, or haven\u2019t saved for a down payment, or if a 15-year fixed-rate mortgage would eat up more than 25% of your take-home pay.<\/p>\n

Other experts agree that buying now makes sense<\/p>\n

\u201cI\u2019m with Dave Ramsey. Now could be a great time to buy a new home. Although the Fed rate is not directly tied to mortgage rates, the overall expectation is that mortgage rates will follow the same trajectory,\u201d says Brian Shahwan, mortgage banker and broker with William Raveis Mortgage, part of the Melissa Cohn Group in New York City<\/a>.<\/p>\n

Shahwan explains that as the Fed continues to cut, interest on credit cards, auto loans, HELOCs, and student loans will decrease, potentially freeing up additional funds for homeowners and providing some flexibility in their debt-to-income ratio.<\/p>\n

\u201cBorrowers will always have the opportunity to refinance when mortgage rates ultimately go down. Other options like recasting and post-close-rate modifications may also be available if rates don\u2019t improve anytime soon,\u201d explains Shahwan.<\/p>\n

Kirsten Jordan<\/a>, licensed associate real estate broker at Corcoran Real Estate in New York City, agrees with Ramsey as well.<\/p>\n

\u201cThis is definitely a great time to buy. Sellers are currently motivated\u2014they really want to sell\u2014so there are opportunities to negotiate and find good deals,\u201d says Jordan.<\/p>\n

While mortgage rates may come down further in the future, Jordan doesn\u2019t expect a dramatic drop that would create a \u201cwindfall\u201d scenario where buyers today feel like they missed out.<\/p>\n

\u201cMost mortgages can be refinanced down the road, often without needing a new appraisal, as long as your financial situation remains stable,\u201d she explains.<\/p>\n

While other experts insist you think twice before you buy<\/p>\n

Eli Harris<\/a>, a real estate agent at Fathom Realty in Norton, MA<\/a>, believes that Ramsey\u2019s advice ignores the fact that things don\u2019t always go as planned.<\/p>\n

\u201cAs long as you’re out of debt and have a solid emergency fund is easier said than done. I’m in Massachusetts, where the housing market and cost of living are high,\u201d explains Harris.<\/p>\n

According to Harris, many buyers are now leveraging VA, FHA, and USDA loans, which often come with the benefit of no or low down payments.<\/p>\n

\u201cThe only two ways to reduce your monthly mortgage payment are to increase your down payment or lower your interest rate. With low or no money down, the only option becomes a better rate,\u201d says Harris.<\/p>\n

He explains that while a decrease of a quarter percentage point might help, it doesn\u2019t factor in home insurance and taxes, which are on the rise, as well as repair and upkeep costs.<\/p>\n

\u201cThat quarter percentage point savings quickly gets eaten up by other expenses,\u201d adds Harris.<\/p>\n

In addition, Harris reinforces that refinancing isn\u2019t an option for everyone.<\/p>\n

\u201cIf you can\u2019t pay your bills, lose your job, or don\u2019t have the best credit, your chances of a refi approval are slim,\u201d he explains.<\/p>\n","protected":false},"excerpt":{"rendered":"On Sept. 17, the Fed announced its first rate cut since the end of 2024, lowering rates by…\n","protected":false},"author":2,"featured_media":178437,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[36],"tags":[28,155,101,1554,67473,5412,2462,106046,106045],"class_list":{"0":"post-178436","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-dave-ramsey","10":"tag-economy","11":"tag-fed","12":"tag-federal-funds-rate","13":"tag-mortgage-rates","14":"tag-percentage-point","15":"tag-prospective-buyers","16":"tag-rate-changes"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/178436","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=178436"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/178436\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/178437"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=178436"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=178436"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=178436"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}