NEW YORK, NY - The Federal Reserve is today expected to announce a 25 basis-point increase in its target interest rate, which would mark the third such rate hike in the last 15 months. And with credit card debt steadily worsening, this latest increase will cost U.S. consumers roughly $1.6 billion in extra credit card finance charges during 2017, according to WalletHub analysis. This complicates an already bad situation for credit card users, considering that WalletHub expects outstanding balances to break the all-time record in 2017.
Mortgage and auto loan rates are more difficult to predict because they are longer-term borrowing vehicles with fixed rates. But if markets react to today’s expected rate hike like they did to the Fed’s December 2016 move, the following data points may give us a sense of what’s coming:
- The APR on the average 30-year fixed rate mortgage rose from 3.48% in late June 2016 to 4.32% at the end of the year.
- The average APR on a 48-month new car loan rose from 4.25% in August 2016 to 4.45% in November (the most recent data available).