3 things that may become cheaper now that the Fed cut rates
The Federal Reserve announced its second consecutive interest rate cut on Wednesday, lowering the federal funds rate by 25 basis points to a range of 3.75% to 4.00%. This marks a half-percentage-point drop since mid-September, with another reduction likely in December. While lower rates may disappoint savers who’ve benefited from high returns, they create new opportunities for borrowers as the cost of credit begins to ease across the economy. The effects of these cuts will take time to spread fully, but some lending products are already expected to become more affordable.
Mortgage rates, which had already reached a three-year low prior to the Fed’s decision, could fall further — a relief for both homebuyers and current homeowners looking to refinance. Home equity lines of credit (HELOCs), which have variable rates, are also becoming more affordable, with average rates dropping more than two percentage points over the past year. Personal loans may soon follow, potentially decreasing from 12.25% to around 10% as lenders adjust to the new rate environment. Together, these trends suggest a borrowing climate that’s easing for consumers after several years of elevated costs, offering homeowners and buyers a chance to secure better financing options heading into 2026.
