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Will home equity interest rates fall after the Fed March meeting?
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Inflation isn’t as hot as it was a year or so ago, but prices are still increasing at a 3.2% annual pace, based on the most recent inflation report. Considering the Federal Reserve’s goal of 2% annual inflation, the central bank has not yet budged on interest rates, having held the federal funds rate steady at a 23-year high since last summer.
Meanwhile, home equity interest rates have also remained high. The average home equity loan rate is currently 8.66% (as of March 12, 2024) and the average home equity line of credit (HELOC) rate is 8.99%.
“Keep in mind, home equity and HELOC rates follow the prime rate, which is based on the fed funds rate — as opposed to mortgage rates which, traditionally, follow Treasury yields. This is why we’ve seen purchase and refinance mortgage rates slowly declining — although fluctuating — while home equity rates are standing still,” says Brian Shahwan, VP mortgage broker at William Raveis Mortgage.
The Fed’s next interest rate decision will come on March 20. At that time, what will happen to home equity interest rates?
Explore the home equity loan rates available to you today.
Will home equity interest rates fall after the Fed March meeting?
While there’s no certainty as to what exactly the Fed will do and where interest rates will head, many experts foresee the Fed keeping rates unchanged following its March meeting. However, predictions vary as to when exactly the Fed will start cutting rates and how that will affect home equity interest rates.
A few months ago, experts were more optimistic about rate cuts in early 2024, but that has largely changed recently.
“At the beginning of the year, it was expected that the Fed would begin to cut interest rates as inflation trends improved. After rates remained unchanged in January, we expect them to remain unchanged again, if not slightly higher, since the Fed’s main goal is to bring inflation back toward the 2% target, for which a downward push is still needed,” says Ilan Bracha, founder and CEO of IB Global Real Estate Funds.
That said, home equity interest rates could start dropping in a few months, but not quite yet, according to some experts.
“We won’t see home equity and/or HELOC rates fall until the Fed ultimately starts cutting rates, which unfortunately won’t be in March. With stronger than expected recent economic data, the expectation is that the first rate cut will be no sooner than May or June, so lower home equity rates in March are very unlikely,” says Shahwan.
Even if rates start falling relatively soon, the more significant drop might not happen until later this year.
“There have been some indications that home equity rates specifically will drop in 2024, however, most experts have stated they believe the most significant change will happen during the second half of the year,” says Tai Christensen, president and co-founder of Arrive Home.
“Having said this, accurately predicting the Federal Reserve’s actions is quite challenging. I believe that rates will remain steady through March with more notable rate cuts at the beginning of summer,” she adds.
Find out your top home equity loan rate options here.
Should you borrow against your home equity before rates fall?
While some homeowners might be watching the Fed to see if they should take out a home equity loan or HELOC — or engage in other measures like refinancing or moving — there can still be advantages to acting now, before rates fall.
“It’s crucial to strike a balance between seizing a favorable opportunity and not waiting indefinitely,” says Bracha.
For example, you might decide to use a cash-out refinance loan to tap into your home equity and consolidate debt now, rather than letting a difficult situation linger.
“If a homeowner has high-interest debt, such as credit card balances or personal loans, doing a cash-out refinance to a higher-rate mortgage to pay off these debts can be greatly advantageous,” says Christensen.
And whether you’re looking to refinance or take out a home equity loan or HELOC, it’s important to consider the specific offers available to you, rather than only looking at the broader averages.
“Homeowners should keep their own specific situation as top priority. There are great rates and programs available today for those in need,” says Shahwan.
CBS News
McDonald’s beef patties test negative for E. coli in Colorado, Department of Agriculture says
Colorado has seemingly eliminated one ingredient as a cause for death and illness, as states continue to investigate the source of an E. coli outbreak involving the Quarter Pounder hamburger at dozens of McDonald’s locations. As a result, the Quarter Pounder will begin to return to certain locations.
The Colorado Department of Agriculture announced McDonald’s brand “fresh and frozen beef patties” tested negative for E. coli after its lab analyzed dozens of subsamples.
CDA says it has completed all beef testing and does not anticipate receiving further samples.
Meanwhile, the federal investigation into the deadly E. coli outbreak in Colorado has focused on ground beef patties and onions. There continues to be no evidence that onions grown in Colorado are linked to the outbreak.
According to McDonald’s, The 900 restaurants that historically received slivered onions from Taylor Farms’ Colorado Springs facility will resume sales of Quarter Pounders without slivered onions. Those restaurants are in Colorado, Kansas, and Wyoming, as well as portions of Idaho, Iowa, Missouri, Montana, Nebraska, Nevada, New Mexico, Oklahoma and Utah. The restaurant chain also noted it has stopped getting onions from that facility indefinitely.
“The issue appears to be contained to a particular ingredient and geography, and we remain very confident that any contaminated product related to this outbreak has been removed from our supply chain and is out of all McDonald’s restaurants,” McDonald’s North American Chief Supply Chain Officer Cesar Piña said in a statement Sunday
Since the outbreak was first announced, CBS News Colorado confirmed one older man on the Western Slope died after consuming a Quarter Pounder from a McDonald’s location in the state. Initial information also confirmed more than two dozen people had become ill due to E. coli-affected Quarter Pounders.
Nationwide, this outbreak has sickened 75 people in more than a dozen states, but Colorado remains the only state impacted that has experienced a death due to it.
The Colorado Department of Public Health says there have been 26 cases reported in nine different Colorado counties, and they are located in several different parts of the state:
- Arapahoe County
- Chaffee County
- El Paso County
- Gunnison County
- Larimer County
- Mesa County
- Routt County
- Teller County
- Weld County
The illnesses were reported between the last days of September and through Oct. 11. An investigation by the Centers for Disease Control and Prevention into the outbreak is ongoing.
McDonald’s company leaders previously said they’ve taken Quarter Pounders off the menu in states where there have been outbreaks.
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Puerto Rico comments from speaker at Trump rally draw criticism while Harris’ plan for the island gets Bad Bunny endorsement
With nine days until Election Day, Puerto Rico has been thrust into the spotlight by both campaigns. Vice President Kamala Harris unveiled a plan to assist the island — leading to an endorsement from Bad Bunny — while Puerto Rico was referred to as “a floating island of garbage” by comedian Tony Hinchcliffe, who spoke at a rally for former President Donald Trump in New York City.
In an effort to court Puerto Rican voters in the U.S. mainland, Harris on Sunday posted a video on her social media platforms pledging to create a Puerto Rican task force to create jobs, cut red tape to ensure disaster recovery funds are used quickly and efficiently and work with leaders across the island to ensure Puerto Ricans have access to reliable and affordable electricity.
Rapper and singer Bad Bunny, a global superstar from Puerto Rico, shared the vice president’s video on his Instagram account with his 45 million followers and later posted a clipped portion of the video in which Harris slammed Trump for his response to Hurricane Maria, which devastated the island in 2017.
“I will never forget what Donald Trump did and what he did not do when Puerto Rico needed a caring and a competent leader,” Harris said in the video. “He abandoned the island, tried to block aid after back-to-back devastating hurricanes, and offered nothing more than paper towels and insults.”
In 2017, Trump visited the island to survey damage after Hurricane Maria struck as a major Category 4 storm. While visiting with survivors, the former president at one point threw paper towels into the crowd when distributing supplies, a move that was criticized as callous amid widespread frustration over the federal response to the hurricane that left much of the island without power and food.
A source close to Bad Bunny confirmed to CBS News that the Instagram post represents an endorsement of the vice president, breaking from Bad Bunny’s longstanding tradition to not weigh in on national politics. It’s a coveted endorsement with weight that both political parties have long hoped to achieve to strengthen inroads with Latino voters, given Bad Bunny’s global popularity.
Moments before Bad Bunny’s endorsement, comedian Tony Hinchcliffe targeted Puerto Rico during a set of disparaging jokes while speaking at a Trump rally in Madison Square Garden.
“I don’t know if you guys know this, but there’s literally a floating island of garbage in the middle of the ocean right now,” Hinchcliffe said. “I think it’s called Puerto Rico.”
Trump senior advisor Danielle Alvarez told CBS News, “this joke does not reflect the views of President Trump or the campaign” adding that the jokes were not reviewed or pre-approved.
Hinchcliffe’s remarks, which also included offensive jokes about Black people and Latinos, were met with swift backlash, with several celebrities coming out in defense of Puerto Rico, Latinos in the U.S. and voicing their support for Harris’ plan for the island. Among those who weighed in were Jennifer Lopez, Ariana DeBose and Ricky Martin. Martin, with over 18 million followers, took to Instagram and posted, “Puerto Rico, this is what they think of us, vote for Kamala Harris.”
Several Democratic and Republican politicians were also among those to denounce Hinchcliffe’s swing at Puerto Ricans, who make up a crucial voting group.
Harris’ running mate Gov. Tim Walz said during a livestream with Democratic Rep. Alexandria Ocasio-Cortez, “There are hundreds of thousands of Puerto Ricans across battleground states. They need to vote.”
Ocasio-Cortez agreed with Walz and directed her comments toward Puerto Ricans in the crucial battleground state of Pennsylvania. “If you’re in Reading, if you’re in Philly, look at that trash,” Ocasio-Cortez said, referring to Hinchcliffe’s joke. “What is trash is people actually just thinking of other human beings that way.”
Pennsylvania is home to over 579,000 eligible Latino voters with roughly 50% residing within the “222 Corridor” — a stretch of small cities west and north of Philadelphia including Reading, Allentown and Bethlehem.
With Trump winning the Keystone State in 2016 by 44,000 votes and Biden taking it by 81,000 in 2020, slim margins are again expected to determine the outcome of the presidential election.
Harris on Sunday spoke directly to Latino voters while visiting a local Puerto Rican restaurant in Philadelphia. “When I was in the Senate, knowing Puerto Rico doesn’t have a senator, I always felt a need and an obligation to do what I could as a senator to make sure that Puerto Rico’s needs were met,” Harris said.
Harris campaign spokesperson Kevin Muñoz said Sunday in a statement, “A reminder: Pennsylvania is home to more than 1 million Latinos who are primarily of Puerto Rican backgrounds, and today, Vice President Harris campaigned in the heart of Philadelphia’s Puerto Rican community talking not just about her vision for the island, but how she will lower costs and create opportunity in their communities on the mainland.”
On Tuesday, Trump is expected to campaign in Allentown, Pennsylvania, where Latinos make up 54% of the population, the majority being of Puerto Rican descent.
Republican Florida Senator Rick Scott, an ally of Trump’s, also denounced Hinchcliffe’s comments.
“This joke bombed for a reason. It’s not funny and it’s not true,” Scott said. “Puerto Ricans are amazing people and amazing Americans! I’ve been to the island many times. It’s a beautiful place. Everyone should visit! I will always do whatever I can to help any Puerto Rican in Florida or on the island.”
Republican Rep. Maria Elvira Salazar called the comments “racist.”
The island’s Resident Commissioner Jenniffer González-Colón, a Republican running for governor of the island, said the comments were “despicable, inappropriate and disgusting.”
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contributed to this report.
McDonald’s beef patties test negative for E. coli in Colorado, Department of Agriculture says
10/27: CBS Weekend News – CBS News
Puerto Rico comments from speaker at Trump rally draw criticism while Harris’ plan for the island gets Bad Bunny endorsement
McDonald’s beef patties test negative for E. coli in Colorado, Department of Agriculture says
10/27: CBS Weekend News – CBS News