Ed Yardeni: Bond market may be very concerned with tariff-related inflation
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CNBC
41 minutes ago
- CNBC
78% say Trump's tariffs will make it harder to deal with debt, survey finds. Here are 3 ways to cope
As President Donald Trump continues to negotiate the rate of tariffs that countries will ultimately pay to do business with the U.S., Americans are already feeling the pinch of higher prices — and many worry about their ability to pay down debt. About 78% of survey respondents say Trump's tariffs, or taxes on imported goods, will make it harder to manage or repay debt, according to a recent report by Zety, a resume templates site. The survey polled 1,005 U.S. employees on April 12. More from Personal Finance:How the GOP budget bill targets immigrant financesThis trend picks up as consumers brace for economic uncertaintyThis financial milestone makes you an adult: survey Trump's trade policy has included threatening sharply higher tariffs, and then changing his stance soon after, as a negotiating tactic with other nations. "Tariffs are clearly one of his favorite tools in the toolbox," said Mark Hamrick, senior economic analyst at Bankrate. The administration's tariff policy will make prices on many everyday goods go up. According to a mid-June report by the Budget Lab at Yale University, tariffs could cost an average $2,000 per household in 2025. The analysis is based on tariffs in place as of June 16. Tariffs have also influenced the interest rates consumers pay on their debt. Levies have added to uncertainty in the economy, leaving the Federal Reserve reluctant to lower its benchmark rate. Federal Reserve Chair Jerome Powell said during a panel on Tuesday that the central bank would have cut rates this year if not for the president's tariff plan. The Fed has held interest rates steady at 4.25%-4.5% since December. While that federal funds rate sets what banks charge each other for overnight lending, it also directly impacts borrowing and savings rates for Americans. In fact, the bank's inaction on rates has kept credit card rates near record highs. It's important to create a strong "financial foundation" as uncertainty in the economy lingers, according to Matt Schulz, the chief credit analyst at LendingTree. "Put yourself in the best possible situation by building your emergency savings and knocking down that high-interest debt," Schulz said. Here are three ways to get a handle on your debt despite economic headwinds, according to experts. The first thing you want to do is contact your lender or credit card issuer and ask if they are able to lower your annual percentage rate, experts say. The APR is generally the total borrowing cost of the loan plus any additional fees, per the Consumer Financial Protection Bureau. The average interest rate on credit cards is 24.33%, according to LendingTree. But the rate your issuer offers depends on factors like your credit history. If you have "really good credit," you can expect to be offered a 20.79% APR; but if your credit is not so stellar, the rate you pay could be as high as 27.87%, the site found. Look into a 0% balance transfer credit card, which is "the best weapon that you have in the fight against credit card debt," said Schulz. These offers allow you to move existing credit card debt to a new card and pay little to no interest charges for a set period of time, making a "huge difference," he said. But do your homework before you apply and pick the card that best suits your situation, Schulz said. Bankrate's Hamrick notes, however, that these kinds of balance transfer options are typically reserved for those with good credit. You generally need a credit score of 690 or higher to qualify, and you might incur a transfer fee in addition to other requirements, according to NerdWallet. A low-interest personal loan "can be a really good choice" to pay off credit card debt because you can "knock your interest rate down," Schulz said. Borrowing costs for personal loans tend to be lower than interest rates on credit cards. But many factors can determine the rate you get for a personal loan, including your credit history and your servicer, per NerdWallet. For example, the average APR for a two-year personal loan from a commercial bank was 11.66% in February, according to the Federal Reserve. Meanwhile the average rate on a three-year loan through a credit union was 10.75% in March, per National Credit Union Administration. Be mindful that there is risk involved because you are taking on a new line of credit, and you are tied to a static loan payment for a period of time, Schulz said.
Yahoo
an hour ago
- Yahoo
HELOC rates today, July 4, 2025: Holding steady as prospects dim for a summer interest rate cut
HELOC rates are unchanged today as the U.S. celebrates Independence Day. You won't find a bank or other brick-and-mortar financial provider open today, but starting an online home equity line of credit application is always an option. After a healthy jobs report on Thursday, the odds of a Federal Reserve rate cut in July plummeted. That means the prime rate will likely remain camping out at 7.5%, and as the foundation to most financial product pricing, don't expect any big discounts until fall. As we put another dozen hot dogs on the grill, let's check today's HELOC rates. This embedded content is not available in your region. According to Bank of America, the largest HELOC lender in the country, today's average rate on a 10-year draw HELOC is 8.90%. That is a variable rate that kicks in after a six-month introductory rate of 6.49%. Homeowners have a staggering amount of value tied up in their houses — more than $34 trillion at the end of 2024, according to the Federal Reserve. That's the third-largest amount of home equity on record. With mortgage rates lingering in the high 6% range, homeowners are not going to let go of their primary mortgage anytime soon, so selling a house may not be an option. Why let go of your 5%, 4% — or even 3% mortgage? Accessing some of that value with a use-it-as-you-need-it HELOC can be an excellent alternative. Dig deeper: Is a HELOC a good idea? Pros and cons to consider. HELOC interest rates are different from primary mortgage rates. Second mortgage rates are based on an index rate plus a margin. That index is often the prime rate, which today is 7.50%. If a lender added 1% as a margin, the HELOC would have a rate of 8.50%. Lenders have flexibility with pricing on a second mortgage product, such as a HELOC or home equity loan. Your rate will depend on your credit score, the amount of debt you carry, and the amount of your credit line compared to the value of your home. And average national HELOC rates can include "introductory" rates that may only last for six months or one year. After that, your interest rate will become adjustable, likely beginning at a substantially higher rate. You don't have to give up your low-rate mortgage to access the equity in your home. Keep your primary mortgage and consider a second mortgage, such as a home equity line of credit. The best HELOC lenders offer low fees, a fixed-rate option, and generous credit lines. A HELOC allows you to easily use your home equity in any way and in any amount you choose, up to your credit line limit. Pull some out; pay it back. Repeat. Meanwhile, you're paying down your low-interest-rate primary mortgage like the wealth-building machine you are. This embedded content is not available in your region. Today, FourLeaf Credit Union is offering a HELOC rate of 6.49% for 12 months on lines up to $500,000. That's an introductory rate that will convert to a variable rate later. When shopping lenders, be aware of both rates. And as always, compare fees, repayment terms, and the minimum draw amount. The draw is the amount of money a lender requires you to initially take from your equity. The power of a HELOC is tapping only what you need and leaving some of your line of credit available for future needs. You don't pay interest on what you don't borrow. Rates vary so much from one lender to the next that it's hard to pin down a magic number. You may see rates from 7% to as much as 18%. It really depends on your creditworthiness and how diligent a shopper you are. For homeowners with low primary mortgage rates and a chunk of equity in their house, it's probably one of the best times to get a HELOC. You don't give up that great mortgage rate, and you can use the cash drawn from your equity for things like home improvements, repairs, and upgrades. Of course, you can use a HELOC for fun things too, like a vacation — if you have the discipline to pay it off promptly. A vacation is likely not worth taking on long-term debt. If you take out the full $50,000 from a line of credit on a $400,000 home, your payment may be around $395 per month with a variable interest rate of 8.75%. That's for a HELOC with a 10-year draw period and a 20-year repayment period. That sounds good, but remember, it winds up being a 30-year loan. HELOCs are best if you borrow and pay back the balance in a much shorter period of time.
Yahoo
2 hours ago
- Yahoo
HELOC rates today, July 5, 2025: The home equity line of credit rate remains unchanged
The national average HELOC interest rate stands firm as Americans enjoy a patriotic holiday. A home equity line of credit may be on their to-do list next week, with thoughts of outdoor kitchens and sparkling pools fresh on their minds. HELOCs are a popular second mortgage option that allows homeowners to retain their low primary mortgage rate while getting their hands on some embedded home value. That available cash can be used to reduce high-interest credit card debt, for unexpected expenses — or the perennial favorite, home improvements. There really are few limits to a HELOC's versatility. Now, let's check today's HELOC rate. Dig deeper: HELOC vs. home equity loan: Tapping your equity without refinancing According to Bank of America, the country's highest-volume HELOC lender, today's average rate on a 10-year draw HELOC is 8.90%. That is a variable rate that kicks in after a six-month introductory rate of 6.49%. Homeowners have a staggering amount of value tied up in their houses — more than $34 trillion at the end of 2024, according to the Federal Reserve. That's the third-largest amount of home equity on record. With mortgage rates lingering in the high 6% range, homeowners are not going to let go of their primary mortgage anytime soon, so selling a house may not be an option. Why let go of your 5%, 4% — or even 3% mortgage? Accessing some of that value with a use-it-as-you-need-it HELOC can be an excellent alternative. HELOC interest rates are different from primary mortgage rates. Second mortgage rates are based on an index rate plus a margin. That index is often the prime rate, which today is 7.50%. If a lender added 1% as a margin, the HELOC would have a rate of 8.50%. Lenders have flexibility with pricing on a second mortgage product, such as a HELOC or home equity loan, so it pays to shop. Your rate will depend on your credit score, the amount of debt you carry, and the amount of your credit line compared to the value of your home. And average national HELOC rates can include "introductory" rates that may only last for six months or one year. After that, your interest rate will become adjustable, likely beginning at a substantially higher rate. You don't have to give up your low-rate mortgage to access the equity in your home. Keep your primary mortgage and consider a second mortgage, such as a home equity line of credit. The best HELOC lenders offer low fees, a fixed-rate option, and generous credit lines. A HELOC allows you to easily use your home equity in any way and in any amount you choose, up to your credit line limit. Pull some out; pay it back. Repeat. Meanwhile, you're paying down your low-interest-rate primary mortgage like the wealth-building machine you are. Today, FourLeaf Credit Union is offering a HELOC rate of 6.49% for 12 months on lines up to $500,000. That's an introductory rate that will convert to a variable rate later. When shopping lenders, be aware of both rates. And as always, compare fees, repayment terms, and the minimum draw amount. The draw is the amount of money a lender requires you to initially take from your equity. The power of a HELOC is tapping only what you need and leaving some of your line of credit available for future needs. You don't pay interest on what you don't borrow. Rates vary so much from one lender to the next that it's hard to pin down a magic number. You may see rates from nearly 7% to as much as 18%. It really depends on your creditworthiness and how diligent a shopper you are. For homeowners with low primary mortgage rates and a chunk of equity in their house, it's probably one of the best times to get a HELOC. You don't give up that great mortgage rate, and you can use the cash drawn from your equity for things like home improvements, repairs, and upgrades. Of course, you can use a HELOC for fun things too, like a vacation — if you have the discipline to pay it off promptly. A vacation is likely not worth taking on long-term debt. If you take out the full $50,000 from a line of credit on a $400,000 home, your payment may be around $395 per month with a variable interest rate beginning at 8.75%. That's for a HELOC with a 10-year draw period and a 20-year repayment period. That sounds good, but remember, it winds up being a 30-year loan. HELOCs are best if you borrow and pay back the balance in a much shorter period of time.
