Interest

mexico city -- A few years ago, Valeria Sanchez Marin didn't have a credit card in her wallet. Now, she's wielding plastic like a pro. She has two Visas and two department store cards, and she's making room for more. "They almost chase you down to give you one," the 32-year-old Mexico City homemaker said of credit card solicitors. "Carguelo a mi cuenta!," or "Charge it!," is the cry of a consumer revolution rattling store shelves south of the border.

washington -- In the current credit crisis, Federal Reserve Chairman Ben S. Bernanke has carved a careful path, ensuring there is sufficient money to encourage lending but not enough to stoke an inflationary boom. Bernanke has managed this balancing act by temporarily opening the central bank's credit spigots at a time when nervous investors have been closing theirs. The Fed added $2 billion in credit to the economy Monday atop the $62 billion it added last Thursday and Friday.

Adelphia Communications Corp. won court approval to pay $1.23 billion in interest to unsecured creditors under its plan to exit bankruptcy protection. U.S. Bankruptcy Judge Robert Gerber in New York said the interest payments were fair and appropriate for creditors who had waited to be paid since the cable operator filed for Chapter 11 bankruptcy protection in June 2002. Several creditor groups opposed Adelphia's proposal, arguing that the company was paying either too much or too little.

A federal appeals panel has ruled that California regulators can compel online mortgage specialist Quicken Loans Inc. to refund millions of dollars to consumers under a state law that banned charging interest until loans were officially recorded. Quicken, the largest Internet-based direct mortgage lender to consumers, sued the state over refund demands in February 2003.

Federal Reserve Gov. Susan Bies urged mortgage lenders to tighten credit standards for nontraditional products such as interest-only loans, saying borrowers who have "payment shock" as rates rise may default on their loans. "The recent easing of traditional underwriting controls and the sale of nontraditional products to sub-prime borrowers may contribute to losses on these products," Bies said at a Mortgage Bankers Assn. conference in Half Moon Bay, Calif.

The Federal Reserve on Wednesday left interest rates near zero and said that the economy, while on more stable footing, was likely to remain weak for some time. The Fed gave no indication that, despite improving signs in the economy, it was considering imminent hikes in the key federal funds rate, the rate banks charge one another for overnight loans. Policymakers at the central bank voted 10-0 to maintain the rate between zero and 0.25%, where it has been since December, and reiterated that it would likely keep it there for "an extended period."

Rates on 30-year fixed-rate mortgages rose for a third straight week, hitting the highest level in more than three months, according to mortgage company Freddie Mac. The interest rate averaged 6.24% this week, up from 6.04% last week. Rates on 15-year mortgages, a popular choice for refinancing, rose to 5.72%, up from 5.64% last week. Rates on five-year adjustable-rate mortgages rose to 5.43%, up from 5.37% last week. Rates on one-year adjustable-rate mortgages climbed to 5.11%, compared with 4.98% last week.

Online lender Quicken Loans Inc. sued California in federal court Tuesday, challenging a state law that prevents lenders from charging interest until the day before a mortgage is officially recorded. The Livonia, Mich., company claimed federal law, which allows interest to be charged as soon as loan funds go into escrow, takes precedence over the state statute. It was the same argument that Wells Fargo & Co.

United States Shoe Corp. lost a U.S. Supreme Court appeal Tuesday that it called a test case for thousands of companies seeking $700 million in interest on the refund of a federal harbor tax on exports. The company said at least 7,500 companies sought refunds after the justices struck down the federal harbor maintenance tax on exported goods in 1998.