Yesterday’s emergency Fed rate cut means good news for those with adjustable rate mortgages. Those with ARMs will see lower rates (instead of higher), and that may help them in terms of payments when the mortgage reset takes place.

Even more prominent, however, is the number of refinance home mortgages taking place right now. Across the country, people are taking out second mortgages as rates fall. The Boston Herald reports on an increase in refinance home mortgages:

“We’re seeing a nice spike in refinancings,” said Joe Bartolotta of
Boston’s Eastern Bank, which yesterday cut its benchmark mortgage rate
a quarter-point to 5.5 percent.

While long-term mortgage rates aren’t greatly influenced by the Fed rate, the current economic conditions and the dramatic cut are both playing a roll in lower mortgage rates.