Whether Powell departs early or serves until May 2026, one broker is preparing for a rate drop
It’s not just the Trump administration and FHFA director Bill Pulte who are dreaming of a post-Jerome Powell Federal Reserve.
With a potential Powell replacement almost certainly tasked with cutting the central bank’s interest rate, one broker is looking forward to what she believes will be a significant rate reduction.
Samantha Shelton (pictured top), mortgage broker, president, and founder of Align Lending, said both industry professionals and potential customers have discussed the topic.
“The biggest conversation that we've really been having lately is the ‘Jerome Powell on the hot seat’ conversation,” Shelton told Mortgage Professional America. “I'm so impressed with how savvy our home buyers have become, because they're asking all the right questions. One of the most important upcoming things in finance and lending is this pending transition at the Federal Reserve.”
The Trump administration has been pressuring Powell and the Federal Reserve to cut rates. While Trump has dismissed the idea of firing Powell in the past, many still wonder if the Fed chair will complete his term, which ends in May 2026.
Stronger lending environment
Shelton believes that when there is a change at the Fed, rates will be cut, and the mortgage market could heat up.
“Powell is expected to step down in May 2026, and the replacement is most likely going to mark a significant shift in this direction,” Shelton said. “All signs for us point to Scott Bessent or someone similar. Someone who favors lowering interest rates to support our middle-class housing market.
“Honestly, this shift could bring a significant rate relief, renew our housing demand, and make it a stronger lending environment, which is great news for both buyers and real estate professionals.”
She said people in the industry are cautiously optimistic about the potential rate decline, which could open up a wave of mortgage refinances. Her clients are also asking what Powell’s departure might mean for the market.
“I think that in the conversations that have been happening, I've had a good handful of buyers, and homeowners who are looking to refinance, asking about the Fed changing and what that's going to look like,” she said. “It's kind of building momentum for a more borrower-friendly era. So, I'm really excited about that.”
While the topic of the Federal Reserve can bring a wide range of emotional reactions, Shelton has noticed discussion of the subject in all corners of the industry.
“I know it's kind of like a touchy subject right now,” Shelton said. “Everyone's kind of like holding their breath, like, oh, what's going to happen. But you can almost feel that renewed conversation happening, not just with clients, but in the real estate world as a whole.”
Speculation to preparation
The Federal Reserve meets again next week, where it is anticipated to hold rates once again. This will likely only amplify the criticism of Powell and the Fed once again.
For mortgage brokers like Shelton, the preparation continues for what she believes could be major rate relief after a change in leadership at the central bank.
“We're talking about, ‘How do we get in front of that?’” she said. “’How do we make sure that the clients that you know we're waiting to purchase because rates are too high, how do we start navigating this now?’ We’re really excited for that.”
Part of the preparation for Shelton and other brokers involves ensuring that potential buyers or refinancers don’t fall into a holding pattern, waiting for a future rate drop.
According to Grant Hall (Rosegate Mortgage), a senior loan pro, the constant focus on Federal Reserve rate decisions, particularly Chair Jerome Powell's actions amidst the Trump administration, is deterring homebuyers.https://t.co/pOTAzddhxU
— Mortgage Professional America Magazine (@MPAMagazineUS) July 16, 2025
“I think that we've done a good job of educating and helping them understand where they're at,” Shelton said. “I think it would really be the same conversation that we've had. If you see something that you love, I would hate for you to miss out on it, because we think that rates might be a point lower next year. Let's say that they're going to be a point lower. Get the house that you want. We can worry about refinancing you later.”
She said she hears customers at times talk about a specific rate they’re waiting for. However, that rate might not be available again for a while, and a buyer might miss out on the house they want if they wait for a specific interest rate.
“We do have those, ‘I'm going to wait for interest rates to fall,’” she said. “Because what you might have in your mind as your target rate, that would be like, ‘Well, if it was a 4% I would feel comfortable. But we're not at 4%. We’re not touching 4% unless you’re paying some points. And not everybody is comfortable doing that.”
The nonstop news cycle can wear down brokers and borrowers. Shelton says it’s part of the job.
“It really comes down to just as an originator, just staying in front of your clients, making sure we're educating, staying up on the market,” she said. “It's not always fun to have to stay up with and understand everything that's happening, but it's my job. You want to work with somebody that you can trust and somebody that you know has your best interests in mind.”
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