Homeowners should soon expect a higher repayment as interest rates rise for the first time in three years, bringing them to .25%-.50%.
The rate will likely hit 1.9% by the end of 2022.
This brings higher mortgage rage, credit card repayments, and better interest rates for savings accounts.
The last time the feds raised the rate was in Dec. of 2018.
During the COVID-19 pandemic, interest rates were cut.
With the inflation rate going so high so fast, the newly implemented interest rates should help the issue.
Credit cards and interest rates
With the rates changing, the interest rate on debt is expected to reach 17% by the end of 2022.
This could mean hundreds of extra dollars for debt.
This means if you can get an interest rate of 0%, you should grab it while you can.
Mortgage and car loans with interest
If you have a fixed loan already, your mortgage rate will not change.
If you have an adjustable rate mortgage, you’ll likely see an increase.
It may not change immediately but it could down the line.
What this means for inflation
The overall goal is to slow the rate of inflation.
This doesn’t mean prices of groceries will immediately drop.
Restaurants will still have the pandemic pricing and menus they’ve had for some time.
The rate of inflation won’t drop, but it will slow down.
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