This is a bonus episode of the rental income podcast. And now, Dan Lane. There's been a lot of changes in the mortgage market recently. And a few weeks ago, the Federal Reserve made a surprise half point rate cut. Jayley, can you tell us what this means? Give us some background on what this means for the mortgage market?

Absolutely. So first of all, let me take a minute and explain to your listeners or dispel maybe some of the myths or misunderstandings that they get when we talk about the Fed Fund rate.

So first of all, everybody, this is the intra-daily trading rate between banks.

That's what the Fed fund rate is based off of, very different to our long-term mortgage rates that are bond-driven.

The Treasury is the one most commonly measured for our longer-term mortgage rates.

So just to differentiate those two, and while there is a connection clearly between them, they are very

different indices, indexes. So, you know, I was one of those believers that thought that when the feds

met on September 18th, that we were going to hear them announce a quarter percentage point rate cut

when in fact they came out with the half as you mentioned

Dan I lost lunch based on that I had bet out there and I got to pay for lunch so so I didn't get that

one right but as a result what we found right afterwards we did see some improvements to our

long term rates initially probably within the first few days to

week right after that announcement. But from then to now, if you've been watching this or even

seen any of the headlines, you know that the reverse has taken place for our long-term rates.

Interest rates are actually up. And the reason for that is, is that the inflationary metric or data that's been posted

since the announcement, the economy's still too hot. So as a result, Wall Street has kind of taken

into their own hands and made the appropriate corrections for mortgage-backed securities as it

relates to our long-term rates. On today's bonus episode, Chley's going to explain more about what's going on in the mortgage market

and what this means for us as rental property investors.

We'll take a look at what the mortgage rates are today for a rental property

and go over a payment example with today's rates.

And we'll see how much your payment could be if rates come down a little bit more.

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