CSBJ Daily

Despite Federal Reserve efforts to lessen the cost of credit by lowering its benchmark rate a total of 2.25 percent since September, rates to consumers have barely budged.

The latest figures from Bankrate.com show lenders have apparently tightened consumer credit standards, leading to less lending and higher interest rates.

The failure of credit markets to respond to the Fed’s dramatic easing of rates might mean that consumer spending will not pick up as regulators had hoped.

The average interest rate on a 30-year fixed-rate mortgage stands at 5.88 percent, 2 basis points below the September level. For jumbo loans exceeding $417,000, borrowers are paying an average of 6.82 percent, just 20 basis points lower than September’s rate.

Moreover, most lenders now require a 20 percent down payment on such loans, which were formerly available with as little as 5 percent down.

For buyers of new cars, a five-year loan costs 6.95 percent, 4 basis points more than during September. In states that have been particularly hard-hit by the subprime crisis, rates are as high as 7.5 percent.