Ford Joins GM, Toyota in O% APR Financing Offers

After troubled Toyota announced last week its unusual move of offering zero-percent financing for up to 60 months on several models, General Motors followed with no-interest incentives of its own. Now comes word that Ford has expanded its incentive programs. Ford is offering zero-percent financing for 60 months on some models, including the Focus, Fusion, Milan, Edge, Escape and Mariner — or cash back options, the Detroit Free Press reported today.

Credit Card Borrowing Falls for 16th Month, But Stabilizing

Credit card borrowing fell for the 16th consecutive month in January, but the decline was the smallest since July — and overall consumer credit with auto loans included managed the first increase in a year, the Federal Reserve reported today. The unexpected increase in combined revolving and non-revolving credit was a surprise to analysts who expected a 12th-month with a decrease, because of predominantly tight credit standards among lenders. The Fed reported this week that most of its 12 districts “indicated banks remained cautious about lending.”

Study: 59% Pay Off Credit Card Balance Each Month

In another indicator that Americans are increasingly inclined to reduce their credit card debt, a sampling of 150,000 consumers last month shows that 59 percent pay off their card balances in full each month, compared to 46 percent a year ago. The study by BillShrink.com reinforces what the Federal Reserve has been reporting for several months. Revolving credit, or credit card balances, fell $8.5 billion, or 11.7 percent, to $866 billion in December, the 15th-consecutive monthly decline, the Fed reported last month.

30-Year Fixed Mortgage Rate Jumps Back Over 5%

The beleaguered housing finance market gave out more bad news today with the 30-year-fixed mortgage rate jumping back over the key level of 5 percent – to 5.05 percent for the week ending today, up from 4.93 the previous week, according to Freddie Mac.
A year ago the key long-term mortgage rate was at 5.07 percent. But it has bounced from a record low of 4.71 percent in December.

TransUnion: Average Credit Card Debt Still Slipping

With stricter credit card laws taking effect this week, there’s even more bad news for card issuers. The average credit card debt continued its slide in the fourth quarter 2009, down to $5,434, a 3.18 dip from the previous quarter and down 5 percent from a year ago, reported TransUnion. The credit bureau also reported that the national credit card delinquency rate, the ratio of card borrowers 90 days late, increased to 1.21 percent in the fourth quarter, up 10 percent from the previous quarter, but remained flat year over year.

Processing of Homebuyer Tax Credits to Ramp Up

The Internal Revenue Service this month is expected to begin processing the new form for those eligible to claim the first-time homebuyer tax credit, or for those long-term homeowners who can also qualify for a credit under certain conditions. The IRS Form 5405, along with related instructions, was released last month for the 2009 tax year. The agency has also provided more helpful information to avoid confusion brought about by the Obama Administration’s extension and expansion of the popular credit in November.

Reform May Keep Credit Card Debt at Downward Pace

Consumers are using their credit cards less or paying of their balances more at an historic pace, according to the latest figures from the Federal Reserve’s monthly snapshot of borrowing trends. And on Feb. 22, equally historic restrictions on interest rate hikes will take effect with credit card reform’s focus on protecting consumers’ outstanding balances. Revolving credit, or credit card balances, fell $8.5 billion, or 11.7 percent, to $866 billion in December, the 15th-consecutive monthly decline, the Fed reported.

Home Sales Stabilize as Tax-Credit Fever Ebbs

Pending sales of existing homes have stabilized, with a modest 1 percent increase in a key housing market index for December that remains above year-ago levels, according to the National Association of Realtors’ forward-looking measure of activity. Based on contracts signed in December, the pending home sales index rose from 95.6 in November to 96.6.

Fed: Demand for Loans Down, Access to Credit Difficult

Fewer households and businesses are borrowing in a market where access to credit remains difficult, according to a Federal Reserve official’s testimony before a Congressional Panel. Residential mortgage and consumer debt outstanding has fallen sharply through the first three quarters of 2009, and the trend likely persisted through the fourth quarter, said Jon D. Greenlee, the Fed’s Associate Director, Division of Banking Supervision and Regulation. Greenlee testified yesterday before the Congressional Oversight Panel in a field Hearing in Atlanta.

Home Sales: Where’s the Boost from Tax Credits?

The tenuous outlook on the housing market didn’t get any better today with the announcement of new home sales for December unexpectedly dropping, indicating that an extended tax credit program has not yet had the impact the industry anticipated. New home sales declined 7.6 percent for an annual pace of 342,000, the lowest since March, said the Commerce Department today. For all of 2009, sales fell 23 percent to 374,000, the lowest level since records were initiated in 1963.

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