Wall Street got a surprise on September 18. Many expected a quarter-point cut in interest rates, but were treated to an unexpected half-point cut instead.
The prime rate -- which influences many consumer and business loans - is expected to follow the Fed's rate cut. If so, the prime rate would drop to 7.75% from 8.25%. The prime rate has been at 8.25% for the past 15 months. For consumers, the rate cut will mean lower rates on many adjustable rate credit cards, home equity lines of credit and other consumer loans pegged to the prime rate. Some house-strapped consumers also will feel a slight break on their adjustable rate mortgages.
But the hope of many in the real estate and mortgage business is that this rate cut will filter down to primary mortgage loan rates and convince buyers who have been sitting on the fence for months to finally jump into the market, and take advantage of great deals and low rates.
This could be just what it takes to turn the market around - especially in a historically strong market like Myrtle Beach and the Grand Strand. We are watching carefully...
Hasn't filtered down yet. Its had the exact opposite effect! Hopefully soon we'll start to see some improvement on this side of things.