| Navigating the deluge of credit cards
In a country from which there are hundreds of credit cards to choose, picking one that best suits your financial needs and lifestyle is no easy task. There are cards that offer rewards, cards that tout low interest rates and cards that have no annual fees. Many of these credit card offers have been dropping into mailboxes recently. January is a busy month when it comes to applications sent out by credit card issuers. That's not surprising, given that many people who used their credit cards heavily in December for holiday shopping may be in the market for a new one. "We've heard that from card issuers, and we've seen that in our business," said Bill Hardekopf, chief executive officer of Lowcards.com, a Web site that helps consumers compare credit cards.
Stimulus deal promising; housing risks still plentiful
Wall Street loves slogans. One of the most popular is: Don't fight the Fed.
If the Federal Reserve is lowering rates, the saying goes, investors should go with the flow, buy stocks, and sooner or later benefit from the ability of consumers and businesses to borrow money at lower interest rates.
In theory, both consumers and businesses can't resist the urge to borrow at enticing rates. So with rates down, they spend money on everything from sweaters to vacations to computers and business equipment. Then companies benefit from rising sales and profits. And because stocks in theory rise based on company profits, the low interest rates the Fed sets in motion generally end up giving the stock market a boost.
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US rate cuts to boost house prices in Dubai, Abu Dhabi and Hong Kong
Hong Kong residents are perhaps more used to playing their property market than people living in the Gulf, whose freedom to buy has only emerged from relatively recent market liberalisation. They have therefore been quicker to recognise what lower interest rates mean for real estate and mortgage applications are up by 50 per cent; and to be fair the Hong Kong banks have also been much quicker to adjust mortgage products to take advantage of low interest rates. House price inflationBut lower finance costs ripple across the whole property development chain from land prices right through to secondary sales. If it is cheaper to finance development then profits are bigger. If home finance costs are falling, and look likely to fall further, then more buyers will enter the market. It is an upward price spiral or house price inflation that will result.
Loans Emerging from your Property
Loans against residential property are the cheapest options available to the homeowners. These loan plans can offer more loan amount at lower rate of interest. A loan against your home is granted only when you are willing to pledge it as a security, and therefore, there are chances of losing it if you fail to repay the loan in time. Hence, before deciding, you would like to ensure that you can afford the loan, and comfortably make the repayment. Lenders can sanction the full amount of equity present in your residential property as loan amount, though generally it is only restricted to a certain percentage. If you opt for a secured loan of longer period, the instalments will be smaller, but the quantum of interest will become larger. You have to make the choice according to your need and requirement, and choose the lender that caters to your requirement.
Fed's rate cuts ignite a rush to refinance
A positive note in the chorus of bad economic news sounds loudly, like a call to arms. Or, as happened after the Federal Reserve dropped short-term interest rates three-quarters of a percentage point Tuesday, a race to refinance. The refinancing frenzy began right after the Fed's announcement, local brokers and bankers reported. The 10-year Treasury bond rates on which fixed mortgages are based also fell, and interest rates for 30-year loans plunged as far as 5.125 percent, the lowest level since spring 2004. On Jan. 1, the 30-year fixed rate averaged 6.07 percent; it has ranged between 6 percent and 6.5 percent for two years. Though the number of refinancing applications will not be available until Wednesday from the Mortgage Bankers Association, newspaper and television accounts from Bangor, Maine, to Los Angeles described a boom in activity.
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