What are the monthly payments on a $600,000 mortgage now, after the Fed's December rate cut?
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TL;DR
- The Federal Reserve made its third rate cut of 2025, lowering the federal funds rate to its lowest level since 2022.
- This move is expected to lower mortgage rates, providing relief to potential homebuyers.
- A $600,000 mortgage at today's average rates (5.99% for 30-year, 5.37% for 15-year) results in monthly payments of $3,593.45 and $4,861.21, respectively.
- These rates are significantly lower than in January 2025 (7.04% for 30-year, 6.27% for 15-year), saving borrowers approximately $415 per month on a 30-year loan.
- Waiting for 2026 to lock in a rate is potentially risky due to uncertain future rate cuts and increased market competition.
- Refinancing in 2026 is an option if rates drop further, but locking in current rates offers immediate affordability benefits.