Blog Post Date August 12, 2025
By Don Almeida- Mortgage Expert and President of Happy Home Mortgage
The Federal Reserve may be preparing to give the economy a substantial boost — and that’s good news for anyone thinking about buying a home. Fed Governor Michelle Bowman, once known for her cautious stance, has now signaled strong support for multiple interest rate cuts before the end of 2025. She believes the labor market is showing signs of strain, inflation pressures are easing, and early action could help keep growth steady. For buyers, this could translate into more affordable mortgage rates in the months ahead.
At the Fed’s most recent policy meeting, Bowman made headlines by dissenting from the majority — she wanted a rate cut right away, rather than holding steady. This marked the first time in more than 30 years that more than one Fed governor broke from the consensus to advocate for lower rates. That’s a powerful sign that momentum is shifting toward policies designed to make borrowing cheaper and help stimulate the economy.
The latest jobs report helped solidify Bowman’s view. July saw only 73,000 jobs added, and previous months’ gains were revised downward by 258,000 — a clear signal that hiring is slowing. While that might seem like bad news on the surface, it also means the Fed is less concerned about the economy overheating and more inclined to lower rates. Lower rates tend to filter quickly into the mortgage market, creating better financing options for buyers.
Another key factor in Bowman’s optimism is her belief that tariffs won’t keep inflation elevated in the long run. With inflation pressures expected to keep easing, she sees a clearer path to the Fed’s 2% target. That means the Fed can focus more on supporting job growth and consumer spending — both of which create a more favorable climate for housing.
If Bowman’s forecast comes true and the Fed implements multiple cuts in 2025, mortgage rates could see noticeable drops. For first-time buyers and those considering a move-up purchase, this could improve affordability and open doors to more inventory. Even a small reduction in interest rates can have a big impact on monthly payments, making it easier for buyers to get the home they want without stretching their budgets.
The bottom line: The Fed is increasingly signaling that relief is on the horizon. If you’re thinking about buying or refinancing, keeping an eye on these developments is key — and being ready to act quickly when rates drop could mean thousands in savings over the life of your loan.
If you’re ready to explore your options before the next rate move, I can run the numbers, compare your quote, and help you position yourself for maximum savings. Let’s make sure you’re first in line when rates head lower.
Sources:
Scotsman Guide. “Fed’s Bowman Makes Case for Multiple Rate Cuts in 2025.” Scotsman Guide News, Aug. 12, 2025.
Reuters. “Fed’s Bowman: Multiple Rate Cuts May Be Warranted in 2025.” Reuters, Aug. 12, 2025.
American Banker. “Bowman Breaks with Fed Majority, Pushes for Immediate Rate Cut.” American Banker, Aug. 12, 2025.
Wall Street Journal. “Fed Officials Signal Openness to Rate Cuts as Growth Slows.” Wall Street Journal, Aug. 12, 2025.
