President Donald Trump has recently announced several policy proposals aimed at tackling affordability issues, including capping credit card interest rates at 10% and banning large institutional investors from buying single-family homes. While these ideas may sound appealing to consumers struggling with high costs, experts warn they could have unintended consequences that might ultimately harm the people they're designed to help.
Credit card interest rate caps could backfire
Trump announced on social media Jan. 9 that he would implement "a one-year cap on credit card interest rates of 10%" starting Jan. 20, 2026. When asked about the idea, many Americans expressed support, with some estimating it could save their families $200 to $300 per month.
However, industry experts are raising red flags about the proposal's potential impact.
"It sounds great, but it will have catastrophic ramifications for the total economy," Richard Hunt said.
Hunt, who represents The Electronic Payments Coalition for credit unions and banks, cited analysis showing that interest rate caps would force banks to limit credit access. The research found that cash-back programs and travel rewards would also be eliminated.
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"If you were to cap interest rates on credit cards, 82% of cardholders would lose their credit cards," Hunt said.
Housing investor ban may not solve affordability crisis
Trump's Jan. 7 proposal to "ban large institutional investors from buying more single-family homes" also faces skepticism from housing economists.
"It's not really going to accomplish anything," Daryl Fairweather said.
Fairweather, chief economist at Redfin, explained that large institutional investors represent only a small portion of home buyers nationally. She believes smaller investors would likely fill the gap if major institutional buyers were banned.
"It's not necessarily going to open up inventory for first-time homebuyers," Fairweather said. "The reason housing is so unaffordable is we are about 4 million houses short."
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The proposals come as Trump continues to emphasize economic improvement in his public appearances, including a recent event in Michigan where he declared, "We are making America Great Again like never before."
While these affordability measures may resonate with Americans facing financial pressures, the expert analysis suggests the real-world outcomes could be more complex than the straightforward solutions they appear to offer.
