Building on a strong economy and fearing of inflation, the Federal Reserve increased interest rates this week to slow the economy and control inflation.
This is the rate that banks charge each other when borrowing money. The raising of the rate affects borrowing money for homes, cars and any other investments.
The whole idea
Most credit cards have a variable rate, and when the feds increase interest rates, credit card rates increase as well, costing you money to borrow. Try to find interest free rates until you paid them off.
Mortgages are increasing becoming more expensive since the feds began increasing interest rates. The recent increase in rates and the increasing of home prices will make homes about 10 percent less affordable. Mortgages with adjustable rates will be affected the most. Try to lock in your rates.
The effect of incensed rate on auto loans is minim, about $3 a month in a $25,000 car. The higher the price, the bigger the effect will be.