What do interest rate cuts mean for contractors like you?

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If you offer financing, you’ve probably already seen the good news. On July 31, the Federal Reserve cut interest rates—meaning that the loans that you show your customers will have the lowest rates in almost a year. 

What is a rate cut? 

A rate cut occurs when the Federal Reserve (often referred to as “the Fed”) cuts the federal fund rate. That rate acts as a benchmark that banks, credit unions, and other lending partners use to set their own rates. If the Fed cuts rates, lending institutions typically do so as well. 

Lower rates mean that customers pay less interest over time—and the total cost of the loan goes down as a result. 

For contractors like you, a rate cut is an opportunity to close more customers by offering desirable financing options. For every job that you sell with financing, you’ll get paid for your work as usual and your customers will pay less for the project of their dreams—it’s a win-win!

What do rate cuts mean for you? 

If you have customers looking for a personal loan option, like the ones found through Hearth, now is a great time for them to find an option and lock in their rates. 

Financing options have become more desirable for homeowners

The recent rate cut helps make loans more desirable to consumers looking to start a project, like repairing their roof, renovating their kitchen, or replacing their HVAC system. Make sure that you offer financing with every bid so that consumers can take advantage of these low rates.

Here’s how you can include desirable rates in your next sale to help close the deal: Interest rates are the lowest they’ve been in almost a year. If you’re interested in financing options, you’ll be able to take advantage of these lower rates. We partner with a financing service called Hearth that allows you to get an idea of rates and monthly payment amounts for your project within a few minutes and without any effect on your credit score. Would you be interested in taking a look? 

Lower rates can help you reactivate old leads

Use this chance to catch up with some old leads and offer them financing options with attractive rates. Sending these leads your loan form allows them to explore their monthly payment and rate options. 

You can send the loan form directly from your Hearth app or web dashboard.

You can send the loan form directly from your Hearth app or web dashboard.

Here’s how you can introduce lower rates to leads in order to generate interest: Hi x! If you’re still interested in starting your project, I wanted to make sure that you knew that we now offer monthly payments through my financing partnerHearth. You can see your monthly payment and rate options without affecting your credit score. I don’t want you to miss the chance to lock in today’s lower interest rates! Click here to see financing options: [your page link here].

Tip: If you don’t yet offer financing through Hearth, we can setup your account in just a few minutes, and you’ll be well on your way to offering convenient monthly payments with competitive rates. 

Homeowners can enjoy today’s low rates for the entirety of their loan term

Once a customer applies and is approved for a loan through Hearth, their monthly payment amount and interest rate won’t change. Because Hearth offers fixed rates, your customer will continue to enjoy the benefits of today’s lower rates—even if the Fed decides to raise rates between now and the end of their loan term.

Here’s how you can emphasize that customers should take advantage of these low rates while they last: I can’t promise that the rates you’ll see tomorrow, next month, or next year will be as low as the ones that you’ll see today. If you apply today, the rates that you see will be locked in. Even if interest rates rise between now and the end of your loan term, you won’t have to worry about any changes to your monthly payments!

The Bottom Line:

The recent federal interest rate cut means that consumers may pay less for a loan than they did before the rate cut. Lower rates make financing options, like the personal loans found through Hearth, more desirable to customers and can help you close the deal.

Hearth is a technology company, which is licensed as a broker as may be required by state law. Hearth does not accept applications for credit, does not make loans, and does not make credit decisions. Hearth works with various lending partners to show customers available financing options; all loans subject to credit approval. Hearth is available nationwide, other than in Maryland, Nevada, North Dakota and Vermont.

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