The key word is UP. Today, mortgage rates are the highest they have been in the past four months. But still, lower than they were a year ago.

So much for “they always keep interest rates low right before an election” — something I have never said or believed.

But I did say that I expected rates to continue to inch downward, and here they are inching upward instead. So as I’ve always said, no one can predict mortgage interest rates with 100 percent accuracy. Things happen that make no sense.

Like now, the data would indicate that rates should have gone down, not up. But the bond market and interest rates don’t always conform to the data.

What are mortgage interest rates today? Depending on if you live in a coastal state or middle America — and inside those regions, there are certain states, like Florida, that are different than their neighboring states — interest rates today are in the range of 6.5% to 7%, with many at 6.75% to 6.875%.

I wish I had a crystal ball, but the truth is that it is impossible to forecast how the election next week is going to impact mortgage interest rates. The only thing we know for sure is that the election has the potential to affect rates by a significant amount. If it does happen that rates swing wildly on the day of or day after the election, history tells us that in the following days, a “correction” will occur in which they settle back to what they were before.

How can a credit bureau offer a debit card when they are not a bank!?! Obviously, you can’t pay for your groceries without money to back it up.

Experian is putting their name on a debit card that is actually issued by Community Federal Savings Bank. Makes me think of a multi-level marketing pyramid.

Why is Experian doing this? Because it gives them license to spy more on your spending.

This does not help or boost your credit score in any meaningful way. So-called Boost is to boost their own knowledge of all your financial workings, not to boost a benefit to you. Think about it: do you expect a for-profit, superrich credit bureau to care about you personally? Or are they working purely for their own benefit?

The New York Times published a lengthy article By Rob Lieber that was printed in The Seattle Times Sunday, Oct. 13 with the same opinion as mine. (You can read it here.)

Speaking of nonsense, why did Taylor Swift’s boyfriend, football player Travis Kelce, sell himself out to advertising the nonsense and deceptive Boost card? When The New York Times reached out to him, all he had to say about it was that it’s “cool.” Does he even understand it? Did he evaluate how it works? Or did he just agree to let them use him for the money he’d get paid? I haven’t interviewed him, so I can only guess.

There is no perk to the credit bureaus’s Spy Card that you can’t get elsewhere without the credit bureau snooping into all your spending. Be smart: when you see an offer from Experian’s Boost say NO.

Here’s an article I posted way back in 2020 on 3 Reasons to Say No to Boost:
https://askcarolynwarren.com/2020/11/18/three-reasons-to-say-no-to-experian-boost/

If you know someone who has a student loan, this is important information.

Facts About Student Loans No One May Have Told You

1. A student loan paid on time every month is powerful for boosting your credit score — more influential than a credit card.
   
   2. A student loan with late payments can devastate your credit score — more than lates on a credit card.

3. Student loans do not count in your credit usage ratio, which is good for you. (The scoring system adds up all your available credit and compares that to the amount of credit you’re using. This is your credit utilization ratio. Since new student loans have a high balance-to-credit ratio, it is good for you that student loans don’t factor in your overall ratio.)

4. Student loans can be sold from one company to another, which is fine, except when they don’t inform you in time for you to switch your automatic payments to the new company, and then your payment isn’t received, and they report you late. This means you must continue to monitor your student loan payments even after they’re on auto-pay.

5. Student loans usually have a low interest rate with a long payment term. This creates longevity for a positive pay history, and can be excellent for your credit score. This underscores the importance of always paying on time.

6. Student loans are not being forgiven or waived by the U.S. government. Don’t destroy your good credit by ignoring your student loans thinking they’re going to be soon wiped out. (Only the private school student loans that were found to be sold to student under fraudulent terms were forced to stop.)

7. The credit scoring system likes to see a variety of different types of credit, such as a credit card, an auto loan, a mortgage loan, and a student loan. So if you have a student loan, recognzie that it helps your credit on yet another level: credit mix.

8. If you find yourself unable to pay your student loan, call immediately and work out an arrangement, either a deferment or a reduced payment. Do not wait until after your payment is late! Do not shoot your credit all to pieces because you don’t know what to do. Call and ask for the department that helps with payment deferment.

9. If you have a co-signer on your studnet loan (which I hope you do not), and you are late, your innocent co-signer’s credit is equally penalized. Therefore, you must handle a financial hardship situation before going late! Have the courtesy of speaking with your co-signer as well as the student loan company. They co-signed in good faith, and you owe them that honesty and transparency.

If you know someone who has a student loan, please pass on this important information to them. Thank you.

Two new statistics have come out from Vantage Score, the new credit scoring model that advertises as being fairer and more realistic in scoring. Let’s look at what’s going on…

Stat #1 Credit usage is down. The average balance-to-limit ratio is 51%.

Down is good, so to all who are working to pay down your balances: way to go! You’re almost at a tier level for a higher score. But we want to see that balance 2% lower.

When you get your balance at 49% of the limit, then you should see a credit score improvement. So be encouraged and keep on paying off that balance. Below 50% is a marker on your way to your main goal.

Your main goal for credit card usage is to keep your balance at 0% or up to about 29%. If it’s at 10%, even better.

With a low balance-to-limit ratio, you gain credit score points. You do not have to use your credit card every month, once you have had it for at least six to twelve months, so if the balance is at $0 for awhile, that is fine.

To prevent the creditor from closing down your card and lowering your “credit available” number, do use your card at least once a year. Each creditor has its own rule about how long they’ll let you go without using the card before they shut it down, so you need to call and ask your individual card service department if you’d like to make sure.

When they shut down a card for non-usage, then oftentimes a person’s score goes down, because their overall “credit usage-to-credit available” ratio lowers. However, in situations where a person has an over-abundance of credit cards, then it is no problem. If that ratio goes from 19% to 15%, for example, I wouldn’t expect to see any loss of points.

Stat #2 Delinquent payments is up. This is bad news any way you want to look at it.

A late payment always hurts your credit score, and the newer the delinquency is, the more points you lose.

A credit card late payment is one of the most difficult negative items to get removed from a credit report, so never think it’s no big deal and you’ll dispute it later. If the late payment is factual, then you might be living with the consequences for a long time.

If your cash flow is down for the month so that you don’t have the funds in your checking account to pay the credit card, then take cash out of savings to pay it (if you have a savings account). Or do your best to sell something, or make some quick money via a side gig so that you can at least make the minimum payment before it goes late.

The way to use your credit card to best advantage is:

1) to maintain a $0 to low balance at all times,

2) to pay the full amount due with each billing statement (and never carry a balance month-to-month), and

3) to always pay on time.

If you’re working at paying down debt, good for you! You are on the right path. Keep going. When you no longer carry a balance, you’ll stop wasting money on high interest charges that go to mega-rich creditors — and that will feel so good!

Mortgage interest rates have already moved significantly lower over the past several weeks. Where they move from here will be determined by many factors – not the least of which is the next jobs report to be released next week.

After the weaker report for the month of July another tepid or even moderate job report for August would just about clinch a rate decrease by the Federal Reserve when they meet in mid- September.

Wait? The Fed has not already lowered interest rates? Then how come mortgage rates are going down already?

This is just a reminder that the Federal Reserve directly controls short-term rates. The Federal Funds Rate is the rate banks charge each other for short-term lending. How short-term? Literally, overnight. Banks are constantly getting deposits and making loans, and they are required to keep a certain reserve requirement each day.

Therefore, if they are short of this requirement, they may have to add reserves overnight. When the Fed changes the Federal Funds rate, certain short-term rates move automatically, for example the prime lending rate.

Long-term rates are indirectly affected by the movements of the Fed. However, the bond market trades every day just like the stock market.

Thus, while they are influenced by the Fed’s moves—long-term rates can move in anticipation of Fed activity.

For example, when the last jobs report was released, long-term rates such as mortgage rates moved down immediately.

Yet, short-term rates such as the three-month Treasury did not move nearly as much. Thus, if we have a weaker jobs report for August, mortgage rates may move down again.

But don’t expect rates to move down when the Fed lowers their Federal Funds rates because the markets would have already anticipated that move. That is, unless the Fed surprises the market and makes a bigger move than expected — such as 0.5 percent decrease instead of .25 percent.

Many thanks to Origination Pro for this post.

I couldn’t believe it! Experian notified me last month that my credit score dropped by 45 points. So I logged into my account to see what was going on. I had not been late or anything like that.

But I had made a large purchase on my JPMBC Visa card, and for that, they punished me. I’ll explain.

I had a planned $6,000 purchase. I had the cash, but I wanted to pay using my Visa card that gave me a lot of reward points, which translated into cash on future purchases. This was an unusual purchase for me, because I have a habit of limiting my balance below 15 percent of the limit. I also pay the entire balance each time the bill comes due.

But this special purchase took me to 91% of my $7,400 limit. Not maxed out, mind you, but over the 90% mark. You’d think that would be no big deal since I’ve paid on time every month for 20 years. But nope!

The almighty FICO thought that I should lose 45 points for the crime of making a one-time large purchase.

I rolled my eyes. I was annoyed. There was only one thing I could do.

When my bill came, I paid off the entire balance immediately. Like I said, I had the cash saved.

On Monday, I checked my credit score since it had been a month, and not only did I have my 45 points back, but they added another 3 points, too.

The 45 points was for having my low balance back (less than 15% of my limit) on my JPMCB card. The 3 extra points was because my SYNCB credit card went from 37% of the limit to 0% (paid off and not used). That’s my second credit card that I use only once every few months to keep it active. Mostly, it sets at $0.

I got my excellent credit score back, and I am happy.

Please note: I do not pay for credit monitoring. My credit reports are on freeze, so there is no need for me to pay for credit monitoring. In my opinion, paying $27/month for credit monitoring is a waste of money. I can see what’s going on with my credit for free, and no one can hack in because my accounts are frozen.

Next week I’ll tell you how I get a score of 814, so remember to keep a watch for that.

Before I became a published author, I attempted to follow the advice of getting articles published first to build a resume. This was in 2006 when mortgage rip-offs were rampant and lenders were doing bait-and-switch and piling on needless junk fees like crazy. I was a mortgage broker, so the greed was making me sick to my stomach.

I wrote an article exposing the scams and sent it to a financial magazine for possible publication. Next came waiting for a reply, which can take several months. While I was waiting, I thought I’d get started writing my book, which was truly my passion.

I finished the book, traveled from Seattle to a writers’ conference in New York City, and met my literary agent. My agent sold the manuscript to Wiley & Sons, Inc. My editor at Wiley was wonderful and helped me polish it into Mortgage Ripoffs and Money Savers. The book was released in 2007, sold in bookstores all over the country.

Radio Host Bob Brinker reviewed my book and gave it “12 stars out of 10.” Sales took off!

Then I received an envelope in the mail. It was from the finance magazine. It contained a short rejection letter: Thank you for your submission, but we don’t feel like the topic of mortgage rip-offs is relevant to our audience, because our readers have very good credit.” That made me laugh.

Too late, I thought. My book is already out and selling. Plus, it’s all over the news that people like your readers are getting financially hurt by the mortgage meltdown that is happening right in front of your eyes.

But the thing that made me smile the most is that even though my “practice piece” did not get published, my “real piece,” my book, did. It was ironic that I could write a book, get an agent and a publisher, and have the book out in stores all over the U.S. before my little magazine article could get a rejection.

What is your BIG dream? Go for it! Don’t worry about who ignores you, ghosts you, or disparages you along the way. What do they know, anyway? If you’re an expert on your topic, proceed with full confidence.

My first (now somewhat outdated) and current (new and relevant) mortgage books: