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| Here's
a look at the state of interest rates on five common consumer banking products
and the latest rates from Bankrate.com's weekly national
survey of large banks and thrifts conducted Dec. 7, 2005. |
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Mortgages
Rate:
6.39 percent (30-year fixed) Average points: 0.32
Without strong guiding winds in the form of economic news,
mortgage rates drifted upward slightly. The average 30-year
fixed-rate mortgage increased 3 basis points to 6.39 percent.
A basis point is one-hundredth of 1 percentage point. Other
rates also edged up a handful of basis points. On the fixed-rate
side, the 15-year rate crept up 3 basis points to 5.95 percent,
and the jumbo 30-year rose 6 basis points to 6.57 percent.
Adjustable-rate mortgages also went up: The average 5/1 ARM
went from 5.81 percent to 5.89 percent; the average one-year
ARM rose from 5.5 percent to 5.56 percent. The benchmark 30-year
fixed rate has remained trapped in a narrow range the past
five weeks, bouncing between 6.32 percent and 6.42 percent.
Next Tuesday's meeting of the Federal Reserve Board could
cause mortgage rates to either rise or fall, depending on
how the markets react to the rate-setting committee's post-meeting
statement.
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| Home
equity products Rates: 7.13 percent (line
of credit); 7.41 percent (loan)
Home equity loan and line of credit rates continued to increase
and at an accelerated pace. The average home equity line of
credit, or HELOC, rate rose 6 basis points, from 7.07 percent
to 7.13 percent. The average home equity loan rate, which
had gone up 1 basis point each week for the past three weeks,
jumped 5 basis points to 7.41 percent. This is the highest
since June 2003. You can expect more of the same, particularly
from HELOCs. The Federal Reserve Board's rate-setting Federal
Open Market Committee meets Tuesday and is widely expected
to increase short-term interest rates another quarter percent.
Within hours of the announcement, most banks will react by
increasing their prime rates by the same amount, and HELOCs
carry variable rates that are most often tied to the prime
rate. Home equity loans, which are fixed-rate products, tend
to move in the same direction, but more slowly. In this rising-rate
environment, that has meant that the gap between loans and
lines of credit is narrowing. In May, the gap was a full percentage
point. Now, it's just over a quarter of a percent and will
continue to narrow after Tuesday's Fed announcement.
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| Auto
loans
Rates:
7.89 percent (48-month, new-car); 8.44 percent (36-month, used-car)
After a sharp reversal for a week, auto loan rates resumed
their slow upward climb. Last week's large drop in the national
averages was due to one lender, Bank of America, offering
special discounts. No other big lender followed suit this
week, so the averages went back up, albeit from a lower level.
The average four-year, new-car loan rate rose from 7.84 percent
to 7.89 percent, with the average three-year and five-year
rates heading up to 7.84 percent and 7.92 percent, respectively.
As always, auto loan rates showed sharp variations between
lenders and between regions, so it's a product consumers can
save a lot on if they comparison shop.
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| Certificates
of deposit
Yields: 3.26 percent (one-year CD yield); 3.91
percent (five-year CD yield) 
Certificate of deposit yields rose again, and
the Federal Reserve Board will give savers another gift on Tuesday, when its rate-setting
committee is expected to boost interest rates another quarter point. The average
one-year CD yield clawed 3 basis points higher to 3.26 percent -- the highest
since Sept. 11, 2001. A basis point is one-hundredth of a percent. The Sept. 11
attacks helped send the Fed into a rate-cutting mode, and CD yields fell very
swiftly after that date. They have been very slow to recover. In the two months
after Sept. 11, banks cut their CD yields by 1 percent, very swiftly passing along
to consumers the Fed's 1 percent cut in that same time. This year, it took 10
months from February until now for the one-year CD to rise 1 percent. During that
time, the Fed has raised short-term rates six times by a total of 1.5 percent.
This week, longer term yields also nudged higher, with the three-year hitting
3.62 percent and the average five-year CD yield rising to 3.91 percent, both up
2 basis points. | | ..............................................................
| Credit
cards
Rates: 13.03 percent (standard fixed);
13.4 percent (standard variable)
Variable-rate credit card issuers continue to cautiously reprice
their products to higher levels, while fixed-rate cards lag
behind. Variable rate cards are most commonly tied to the prime
rate, which moves in lock step with the actions of the Fed,
which is expected to raise rates a quarter point next Tuesday.
The average standard variable rate increased 9 basis points
to 13.4 percent. A basis point is one-hundredth of 1 percentage
point. The average standard fixed rate stayed flat at 13.03
percent based on cards added to the survey group. The average
fixed rate across all card categories -- standard, gold and
platinum -- also was unmoved at 11.57 percent. The average variable
rate across all card classes rose 8 basis points to 12.59 percent.
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