Kiss Cheap Credit Goodbye

For those who can't remember 1981, rates are headed up
By Polly Davis Doig,  Newser Staff
Posted Apr 11, 2010 7:32 AM CDT
Kiss Cheap Credit Goodbye
A South Korean woman walks past an advertisement for a bank's interest rate in Seoul, South Korea, in Seoul, South Korea, Friday, April 9, 2010.   (AP Photo/Ahn Young-joon)

There's a generation of consumers out there that can't fathom 8% interest, much less 1981's peak of 18.2%, but the days of free or cheap money are coming to a rapid close. With national debt ballooning, inflation looming, and government props that suppressed interest rates ending, the cost of credit is headed for a long upward climb, reports the New York Times.

Mortgage rates, at 5.31%, are already up a half-point since December, and experts expect they may hit 6% before year's end. Credit card rates are on the rise, as are those on car loans. Predictions on rate jumps range between a half-point and a point and a half by the time 2011 rolls around, and there's likely no stopping there. “Americans have assumed the roller coaster goes one way,” says one investor. “It’s been a great thrill as rates descended, but now we face an extended climb.” (Read more interest rates stories.)

We use cookies. By Clicking "OK" or any content on this site, you agree to allow cookies to be placed. Read more in our privacy policy.
Get the news faster.
Tap to install our app.
X
Install the Newser News app
in two easy steps:
1. Tap in your navigation bar.
2. Tap to Add to Home Screen.

X