Can Trump Actually Fire Jerome Powell—and What Would That Mean for Mortgage Rates? 🔥🏦

Hello everyone! Last week was another wild ride for mortgage rates and the markets. This week we have Trump vs. Powell, potential Fed shake-ups, and new credit reporting changes are all stirring up uncertainty—but don't worry, I've got you covered. Let's dive into the key updates and what they mean for you and your clients!

Read time: ~4 minutes

Rates ended LOWER compared to last week, and volatility was HIGH. Rates are in the low 7’s for most loan types without paying discount points. Paying discount points can get you in the mid-to-high 6’s.

Can Trump Actually Fire Jerome Powell—and and What Would That Mean for Mortgage Rates? 🔥🏦

A major feud is heating up in Washington—Trump versus Federal Reserve Chair Jerome Powell. Trump has made it very clear he’s had enough of Powell’s refusal to slash interest rates, and he wants him out. Powell, however, isn’t backing down, especially after warning that recent tariffs could lead to stagflation (high inflation + low growth).

But can Trump actually fire Powell?

Not exactly. Powell’s term runs through May 2026, and under current law, the Fed Chair can’t easily be dismissed. However, Trump has already removed FTC commissioners and is actively pressing the Supreme Court for expanded authority to replace leaders of independent agencies—potentially weakening Powell’s job security.

But suppose Trump does succeed and appoints a new Fed Chair willing to aggressively cut the federal funds rate—would mortgage rates finally fall?

Not necessarily—and here’s why:

Mortgage rates don't directly follow the Fed’s short-term interest rates. Instead, they're influenced by long-term bonds, especially the 10-year Treasury yield. Bond investors look years ahead, factoring in risks like inflation and economic instability. If investors fear a politically driven Fed is artificially pushing down short-term rates and fueling future inflation, they’ll demand higher bond yields—which means mortgage rates could actually rise, not fall.

We’ve seen this exact scenario play out before. In the 1970s, President Nixon pressured the Fed to lower rates ahead of an election. Inflation quickly spiraled out of control, eventually pushing mortgage rates sky-high and causing a severe recession.

What can this mean for YOU and your clients?

Savings accounts & CDs: Short-term returns could drop fast (unless it’s a locked-in CD—those remain secure).

Mortgage rates: Surprisingly, a politically pressured Fed might create enough uncertainty that mortgage rates rise instead of fall.

Bottom line— Don’t let your clients get caught up in the political noise. Even if Trump replaces Powell and pushes for aggressive rate cuts, there’s no guarantee mortgage rates will follow. In fact, the uncertainty could push rates even higher. Instead, guide buyers to focus on what they can control—credit scores, down payments, and smart loan options—to position themselves for success no matter what happens in D.C.

BNPL is About to Hit Your Credit Report—Harder than Coachella 🎶💳

Coachella 2025 might have ended with killer performances, but here’s something wild: almost 60% of attendees used "Buy Now, Pay Later" (BNPL) plans for their tickets. While it’s easy to spread payments out, piling up these plans can quickly turn into a financial nightmare—especially when life doesn’t go as planned.

The CFPB is already sounding alarms about hidden fees, late charges, and potential credit impacts from missed payments. And now BNPL lenders like Affirm have started reporting these short-term loans directly to credit bureaus (Experian as of April 1st, 2025).

Right now, these BNPL payments aren’t heavily impacting traditional credit scores, but that's likely to change as new scoring models come into play. Companies such as DoorDash and platforms tracked by TransUnion are also jumping on the BNPL train, meaning this will only grow more relevant.

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