The Federal Reserve announced Wednesday that it would cut the federal funds rate by a quarter of a point. Read on to learn what this change could mean for you.

What is the Federal Funds Rate?

The federal funds rate is the rate at which banks borrow and lend to one another. While the Fed doesn’t directly set consumer loan or savings rates, shifts in Fed policy affect credit cards, auto loans, mortgages, and other financial products.

How Does the Fed’s Rate Cut Affect Mortgages?

If you already have a fixed-rate mortgage, the rate cut won’t change your current payment. For new fixed-rate mortgages, rates may not shift right away since they’re influenced by a mix of market factors beyond the Fed’s decision.

Adjustable-rate mortgages could see changes more quickly. It’s also worth keeping an eye on refinancing opportunities if rates shift further in the coming months.

“Mortgage rates are influenced by many factors,” says Vice President of Lending Christine Whittaker. “We monitor rates every day to ensure we are offering our members competitive rates.”

What About Home Equity Loans and Lines of Credit?

If you have a fixed-rate Home Equity Loan, your payment won’t change with this rate cut. However, most Home Equity Lines of Credit (HELOCs) carry variable rates tied to the prime rate. That means you could see a reduction in the interest charged on your monthly statement, typically within 30–45 days of the Fed’s decision.

Now may be a good time to review how you’re using your HELOC and talk with us about strategies to make the most of your available credit.

What Does the Rate Cut Mean for Auto Loan Rates?

Auto loans are fixed-rate, meaning once you lock in your loan, your rate won’t change. While the Fed doesn’t set auto loan rates directly, its decisions affect the broader lending environment.

Over time, this may lead to slightly more affordable options for members looking to finance a new or used vehicle. Even a modest shift in rates can help lower your monthly payment or expand the range of vehicles that fit within your budget.

Are Credit Cards and Personal Loan Interest Rates Affected by the Rate Cut?

Most credit cards are variable-rate, meaning their APRs move up or down in response to changes in the prime rate, which typically follows the Fed’s decisions. That means members carrying a balance may see a little relief as rates adjust downward.

Personal loans and lines of credit can also shift lower, depending on the product. While the difference may be modest, even a small reduction can help cut interest costs over time.

Does the Fed’s Rate Cut Impact Savings Accounts?

Lower borrowing costs are welcome news for members seeking loans, but they can also mean slightly lower returns on savings products like CDs, certificates, or money market accounts.

For savers, that tradeoff can feel discouraging—but it’s part of how the economy balances borrowing and saving. At Members First, we remain committed to offering competitive savings options while helping you make the most of your money, and our team is always available to talk through strategies that keep your goals on track.

Members First Credit Union’s Commitment to You

We know that rate changes can feel complicated. That’s why we’re here to walk you through your options, whether you’re buying a home, financing a car, or planning your financial future.

“Behind every loan or savings account is a real family, a student, or a small business working toward something important,” says President and CEO Courtney Fifield. “At Members First, we don’t just look at numbers—we look at people. Our promise is to walk alongside our members, offering guidance and support so that financial decisions feel a little less overwhelming and a lot more empowering. That commitment to financial wellness and community will never change, no matter how the rates move.”

Wondering how this change might affect you? Give us a call or stop by your local branch to talk with us about your options.