Debt default would be 'catastrophic' for households -Yellen

"Anyone who has a loan, whether it's a small business, a homeowner with a mortgage, a credit card payment; anyone who borrows would see higher interests costs of their debt," Yellen warned the House Financial Services Committee.

Borrowing costs for all would rise if America's credit rating was downgraded because the debt ceiling wasn't raised, and that would be crippling for the economy, she said.

Yellen made the comments as Democratic lawmakers continued a push to try to convince Republicans to sign-on to a bi-partisan agreement to lift the debt limit in order to pay for spending already done.

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