The information provided on this website does not, and is not intended to, act as legal, financial or credit advice; instead, it is for general informational purposes only. Information on this website may not be current. This website may contain links to other third-party websites. Such links are only for the convenience of the reader, user or browser; we do not recommend or endorse the contents of any third-party sites. Readers of this website should contact their attorney, accountant or credit counselor to obtain advice with respect to their particular situation. No reader, user, or browser of this site should act or not act on the basis of information on this site. Always seek personal legal, financial or credit advice for your relevant jurisdiction. Only your individual attorney or advisor can provide assurances that the information contained herein – and your interpretation of it – is applicable or appropriate to your particular situation. Use of, and access to, this website or any of the links or resources contained within the site do not create an attorney-client or fiduciary relationship between the reader, user, or browser and website owner, authors, contributors, contributing firms, or their respective employers.
Credit.com receives compensation for the financial products and services advertised on this site if our users apply for and sign up for any of them. Compensation is not a factor in the substantive evaluation of any product.
The federal government’s stimulus efforts will likely come to an end relatively soon, and many experts believe that well before 2015, these bond-buying plans will be brought to a halt, according to Bloomberg News. However, credit cards and auto loans will likely not be effected by the change because they are not tied to the same yields as mortgages tend to be. Instead, they are related to the target federal funds rate, which will remain at extremely low levels until 2015.
“From here on out we’re going to see interest rates go up, and not so gradually on the mortgage rate,” Barry Bosworth, an economist at the Washington-based research group the Brookings Institution, told the news agency. “That’s not a small thing for consumers. They have benefited a lot as borrowers on the lower rate of interest.”
Already, interest rates on mortgages have begun what some believe will be a slow climb back to more historically average levels after hovering at or near all-time lows for more than a year, the report said. However, it’s important to note that even as they continue to rise, rates on home loans are still extremely affordable, particularly when compared to those many current homeowners are already paying. As they continue to rise, though, fewer current homeowners will take advantage of refinances.
But where credit cards are concerned, rates are likely to remain relatively flat, the report said. Even as the Fed doesn’t move the prime rate upward from the level it has maintained for years, analysts generally do not predict that they will be moved downward either. Experts say those with variable-rate credit cards, meanwhile, might want to deal with their ongoing debts in a more comprehensive manner because these could see a slight uptick in APRs in the near future.
In general, consumers have been trying to keep their debts down in the last few years anyway, but there has been a steady increase in borrowing more recently. While this has not brought balances anywhere near the levels seen prior to the economic downturn, those hoping to avoid interest charges and other such concerns may want to avoid heavy borrowing.
Image: iStockphoto
October 20, 2020
Auto Loans
July 20, 2020
Auto Loans