Wednesday, April 21, 2010
Sustained period of rising interest rates expected
After a three-decade decline in the cost of borrowing, consumers are facing the beginning of what is expected to be a sustained period of rising rates. According to David Wyss, chief economist with Standard & Poor's, "We've had almost a 30-year rally that's come to an end" (The New York Times April 10).
Homeowners who have not yet refinanced - your optimal window is closing. This spring could offer house hunters the best housing choices and rates. According to Christopher J. Mayer, a professor of finance and economics at Columbia Business School, each increase of one percentage point in rate adds as much as 19% to the total cost of a home.
Since the new federal credit card regulations were adopted there is a now new landscape for the credit card arena. Gone are low, low teaser rates; in are late-payment rates-some nearing 30%-that penalize you for 12 months.
Compare the most recent statements for all your credit cards, and call for current terms on those cards you don't use. Protect yourself against late-payment fees and penalty interest rates by setting up automatic payments. If you're uncomfortable automatically paying the entire monthly bill, try $50 or $100 in an automatic payment and the rest in an additional online payment.
Portions of this article were derived from Home & Family Finance.