If you’re one of the few who can still qualify, now may be a smart time to take out that home equity line of credit. Earlier today officials slashed the Federal Funds rate a half point to just 1%.

The Associated Press explains:

“The Fed, as investors had hoped, announced a half-point cut in the federal funds rate, the interest that banks charge each other on overnight loans, driving it down to 1 percent, a low last seen in 2003-2004. That rate has not been lower since 1958 when Dwight Eisenhower was president.”

Most American home equity lines are based on the Prime Rate which, in turn, is tied to the Federal Funds Rate. Fortunate homeowners who have not received HELOC freeze letters may soon take advantage of these record low rates.

For a more in-depth explanation of how interest rate cuts affect borrowers, see: How Will Federal Rate Cuts Affect Your HELOC APR?

See Also:

How to Negotiate the Best HELOC Rates and Terms

Printable HELOC Comparison Worksheet

Tags | Federal Reserve, Heloc, HELOC Rates, home equity line of credit