The central bank again pumped up its benchmark interest rate another three-quarters of a point with more hikes likely to come. That means credit card and loan interest rates, which move in tandem with Fed increases, will follow suit in 30 to 45 days.
And it’s not credit card debt to the consumer, small business will feel the effects of higher rates, shorter terms, and harder to get approval for those much-needed loans.
The the average variable credit card rate is now 18.16%, the highest in 27 years. And with today’s rate hike means that most credit cardholders will soon face rates that are three full percentage points higher than they were at the start of the year.
Many Americans have tapped credit cards to combat the escalating cost of everyday goods or services the Federal Reserve’s move this week may have grave consequences.
As lenders, we know the rates are higher from a few years ago to get loans to consolidate debt, but in retrospect those loans will be higher soon and my guess lower than the credit cards. The other advantage to refinancing your credit card debt (or any debt) now is you have a light at the end of the tunnel…once your loan is paid you could be debt free from the horrors of credit card jail.
Bottom line…unfortunately for many Americans the federal reserve raising rates (many more to come), Washington spending like lunatics (can’t do both and lower inflation) , high inflation, overloading credit cards could lead to massive defaults and huge increase in bankruptcies.
Now may be the time to act…Use our search program of over 30 plus lenders and banks for your personal or business loan without affecting your credit score.