Interest Rates continue steady upwards climb
By now you may have heard that interest rates are rising, but you may be wondering how much so? To give you an idea of just how much and how quickly interest rates are rising, consider this. Interest normally move slowly, without volatility and they stay in a range before going up or down. Since May of this year alone interest rates have made their biggest move since February of 2013. That's 9 years ago for folks not understanding that. Even with that big move, consider that since November 2021 interest rates have risen the most in over 20 years. So that means borrowing a home is more expensive than it has ever been. That means borrowing a car will be more expensive than ever before. Your student loans will go up in cost as well. I think we can all start to see the direction we're headed here.
Today I read an article mentioning how Bank of America plans to make lending more "Accessible to minorities". However, when one examines what they're actually doing it looks a lot more like a wreckless way of lending being defended by political reasoning. Keep in mind, they're pretty much saying the minorities don't need to show the capability of paying the debt or even have to put down a down payment. Sounds great right? Wrong, because once one reads the paperwork they'll see sky-high lending costs & more than likely a variable mortgage. Sounds like a recipe for disaster and also sounds like a financial institution looking for an excuse to unload bad debt. It's a sign of the desperate times, as home buyer applications are starting to drop.
In Florida, even in middle-income areas average home prices have risen to over $250,000, home insurance is more expensive than ever before and property taxes are going up everywhere. It's an issue that really began at the end of 2020 and is growing more and more out of control. It's going to be interesting to see how it all plays out in the end. This is more than housing, this is lending for anything, including those credit cards we've all become so used to.