Yellen confirms interest rate hike is likely. Make these moves now.
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The Federal Reserve will hike short-term interest rates this afternoon, so now is the time to pay down the balances on your credit cards and home equity lines of credit.
The increase is almost certain to be one-quarter of a percentage point, meaning interest rates on credit cards and home equity lines of credit will go up the same amount. According to futures markets, there’s almost no chance that the Fed will leave the federal funds rate unchanged.
Home equity lines of credit are popular again, now that homeowners have regained equity following the housing crash. In many cases, the interest rates are attractive.
Auto loan interest rates will rise after the Fed rate hike.
As for home loans, the market already had baked a Fed rate hike into the rate cake, which is why mortgage rates went up last week to a nearly three-year high. Unfortunately for homebuyers, mortgage rates probably will continue to climb this week, according to the mortgage experts who vote in Bankrate’s weekly Rate Trend Index.
That’s why you shouldn’t delay, and you should get a mortgage as soon as you can before rates (and home prices) rise even further.
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