The Federal Reserve increased its key rate by another quarter of a point, recently. This increase brought the rate to the highest level in 15 years. The increase was made in an effort to stave off inflation by making borrowing more expensive. However, this fed rate increase will affect consumer’s credit card bills.
Tag: Federal Reserve
Over 40 Percent of Consumers Plan to Take on More Debt Despite Rising Interest Rates
Approximately 43 percent of American consumers say they intend to accrue more debt in the next six months. This is despite interest rates increasing, making the cost of borrowing more expensive. This information comes from a recent study published by LendingTree.
LendingTree surveyed more than 1,000 individuals regarding their spending habits. They found that 61 percent of them already carry some level of debt. Approximately 80 percent of consumer debt is linked to expenses that are considered necessary, such as healthcare expenses or other emergencies.
New Data shows 43 Percent of Credit Card Holders Have More Than $15,000 in Debt
According to the Federal Reserve, credit card debt is the highest it has ever been in the U.S. In December, American’s had a total of $1.029 trillion in credit card debt. This means the average household had $8,732 in credit card debt. A survey conducted by Student Loan Hero reported that 43 percent of credit card holders surveyed had more than $15,000 in credit card debt and 58 percent had at least $6,000 of credit card debt for more than a year.
The Federal Reserve also reported that the average interest rates on credit cards are approximately 14.99 percent, which makes it much more difficult for Americans to pay off their debt.
Carrying a consistent credit card balance is detrimental to your financial well-being. One option that is often overlooked by cardholders is getting a credit card consolidation loan. According to Student Loan Hero, only 52 percent of cardholders that have more than $6,000 in credit card debt have consolidated.
Below are three ways credit card consolidation loans may help you.
- They typically come with lower interest rates than credit cards do, meaning you are paying less in the long run.
- Installment loans set firm repayment plans, unlike credit card companies. This means you are more likely to pay off your debt when making your minimum payment each month.
- They combine your payments. This comes in handy if you have debts across multiple credit cards.
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If you have any questions on this topic or are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.
4 Tech Tools to Help you Get Out and Stay Out of Debt
According to the Federal Reserve Bank of New York, household debt has reached almost $13 trillion as of September 30, 2017. If you are hoping to get a handle on your debt in 2018, here are a few tech tools to help you reach your goal.
- Make a Payoff Plan: Unbury.Me
Unbury.Me is a free online tool that allows users to create an account, list all of their debt and map out a payment plan to suit their needs. The app allows users to either use the “avalanche” method, attacking the highest interest rate debt first, then moving to the second highest and so on or the “snowball” method, which focuses on the lowest balance first.
- Attack Debt Subconsciously: Qoins
Qoins rounds each of your purchases to the nearest dollar, then applying that cash to your student loan or credit card debt. Nearly $1 million in spare change has been saved since the app launched in January 2017. To sign up, you log in and link your financial account to begin saving.
- Meet Payoff Goals Via Savings Goals: Digit
A great strategy for paying off debt is being able to do so without having to think about it. Digit is an app that analyzes your spending habits to gauge the right amount of money to auto-save for your goals. It only transfers an amount it thinks you won’t notice and the cash is moved from your checking account to an in-app savings account. You can also set a goal amount for a certain debt and once you have saved that amount, it will notify and congratulate you.
- Avoid Future Debt by Rethinking Credit: Debitize
If your goal is to pay off credit card debt, it is a good idea to put your plastic in a drawer and lock away the key until you have reached your goal. If you have paid off your credit card debt or you are hoping to avoid accruing more debt, Debitize is an app that will help you avoid more credit card debt. The app enables users to think of credit more concretely by automatically withdrawing the funds to cover any purchase you make immediately – then paying off the balance on your behalf within a day or two. Users end up with a credit card balance of zero each month.
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If you have any questions on this topic or are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.
What the Fed Rate Hike Means for Homebuyers
Last week the Federal Reserve increased its benchmark interest rate by one-quarter of a percentage point. This marked the second increase in three months and the third increase since 2015. As a result, mortgage rates have already increased. The average rate of a 30-year fixed mortgage jumped to a 2017 high of 4.21 percent, up from 3.68 percent last year.
What this means for house hunters is that buying a home is going to be more expensive. “That is going to create a bit of sticker shock for some buyers looking to buy this spring,” said Len Kiefer, deputy chief economist at Freddie Mac.
Fortunately, the changes in the Federal Reserve benchmark interest rate are somewhat predictable. The market expects two more Fed rate hikes before the end of the year. However, another increase is not likely in the next few weeks.
Choosing the right attorney can make the difference between whether or not you can keep your home. A well-qualified Miami foreclosure defense attorney will not only help you keep your home, but they will be able to negotiate a loan that has payments you can afford. Miami foreclosure defense attorney Timothy Kingcade has helped many facing foreclosure alleviate their stress by letting them stay in their homes for at least another year, allowing them to re-organize their lives. If you have any questions on the topic of foreclosure please feel free to contact me at (305) 285-9100. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.
Related Resources:
http://money.cnn.com/2017/03/15/pf/fed-rate-hike-mortgage-rates/index.html?iid=SF_LN
http://www.cnbc.com/2017/03/15/fed-raises-rates-at-march-meeting.html
Americans Borrow No Matter the Economy
The Federal Reserve recently released data that indicated that American’s borrowing habits are excessive whether the economy is booming or hurting. Over the past decade, credit card debt has gone from $1.02 trillion in 2008, down to $835 billion in 2011 and back up to $935.6 billion by the end of last year.
Americans between the ages of 18 and 65 have an average of $4,717 in credit card debt. The average interest rate is 15 percent, according to creditcards.com. Therefore, if a credit card user makes a minimum payment of $189 per month, it will take more than ten years to pay off a debt of $4,717. Ultimately, the debtor would pay a total amount of $22,869, a cost of $18,155 for a very small loan.
A study released by the Boston Fed examined American credit card debt and found that the biggest reason Americans have such high debt is due to the availability of credit.
The study also showed that only 35 percent of credit card users do not carry a balance. This means they pay off their bill every month and only use their cards for convenience. The other 65 percent of credit card users are “revolvers,” meaning they do not pay their balance in full so the debt revolves. Revolvers tend to see credit limit increases as an invitation to spend more.
Many credit card users are reeled in when companies offer free teaser years that come with as much as $600 worth of miles or hundreds of dollars in cash back as incentives to sign-up and spend. Studies show that credit card debt typically starts in a debtor’s 20’s. Often times the debtor is not earning very much at the time and the availability of funds through credit essentially amounts to extra wealth and reduces the need to save. Although the habit typically starts early in adult life, credit card debt follows most Americans into middle, even old age.
Keep in mind; there are incentives to breaking your credit card habits. According to the Federal Reserve, paying off your credit cards comes with a return that averages 14 percent. This means simply paying off your credit card debt is the best investment you can make.
Click here to read more on this story.
If you are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.
The New Housing Boom
The long-struggling housing market is finally beginning to see a turnaround. Signs of recovery have been evident with the recent increases in home prices, home sales and construction. Foreclosures are also down and the Federal Reserve has acted to push mortgage rates near record lows.
Barclays Capital put out a report recently forecasting that home prices, which fell by more than a third after the housing bubble burst in 2007, could be back to peak levels as soon as 2015. The housing rebound can have a ripple effect that could help get the entire economy growing at a much stronger pace, which will add to more demand for housing.
Roger Altman, chairman of Evercore Partners and former deputy Treasury secretary stated that the recent turn in the housing market should become a boom by 2015 and lift the entire U.S. economy. He also expects housing will add 4 million jobs to the economy over the next five years, as the pent-up demand for home purchases drives building and home prices higher.
To read more on this story visit: http://money.cnn.com/2012/10/12/news/economy/housing-boom/index.html
Choosing the right attorney can make the difference between whether or not you can keep your home. A well-qualified attorney will not only help you keep your home, but they will be able to negotiate a loan that has payments you can afford. Foreclosure defense attorney, Timothy Kingcade has helped many facing foreclosure alleviate their stress by letting them stay in their homes for at least another year, allowing them to re-organize their lives. If you have any questions on the topic of foreclosure please feel free to contact me at (305) 285-9100. You can also find useful consumer information on the Kingcade & Garcia, P.A. website at www.miamibankruptcy.com.