Mortgage Market Update 2/19/25

What the Fed Said Today (And Why It Matters for Mortgages!)

The Federal Reserve (the "Fed") had a meeting a few weeks ago, and today, they shared the notes from that meeting. Usually, these notes don’t shake things up too much, but one part caught people’s attention.

The Fed talked about possibly pausing a process called "balance sheet run-off." That sounds complicated, but here’s the simple version:

• The Fed controls a lot of money and bonds.
• They’ve been letting some of those bonds "run off," meaning they aren’t buying as many new ones.
• If they pause this, it means they might start buying more bonds again for a little while.

So why does this matter? When the Fed buys more bonds, it can help lower interest rates—including mortgage rates! Some traders thought this could be a short-term opportunity, so they bought more bonds today.

What Does This Mean for You?
If you're thinking about buying a home or refinancing, this is something to watch. Mortgage rates might dip if the Fed follows through with this idea, even for a short time.