Mortgage rates continued to rise for the week ending April 25. The 30-year fixed-rate mortgage averaged 7.23% APR, up seven basis points from the previous week’s average, according to rates provided to NerdWallet by Zillow. (A basis point is one one-hundredth of a percentage point.)
Rates for 30-year fixed-rate loans have been hovering in the general neighborhood of 7% for the past year-plus, causing considerable pain for home buyers. The rise of mortgage rates in recent years has drawn lots of attention — and ire. As buyers attempt to wrestle their way into affordable homes, it feels like interest rates are definitely the storyline villain. But are rates the actual villain?
Let’s take a little journey back to the last time the U.S. was in a comparable rate environment, roughly winter 2000 to spring 2002. In April 2002, J. Lo is atop the charts. Tiger Woods is becoming the third golfer to win back-to-back Masters tournaments. “The Scorpion King,” starring Dwayne “The Rock” Johnson, is a hit at the box office. And interest rates on 30-year fixed-rate mortgages are at 7%.
Now, here we are, 22 years later. Jennifer Lopez’s latest album came out in February. Tiger’s playing in his 26th Masters. Dwayne Johnson hasn’t been in any movies yet this year, but The Rock did main event WrestleMania. And 30-year fixed rates? Yeah, they’re back at 7%.
With so much that’s oddly the same, let’s talk about why today’s 7% rates hit different. It’s not just because that slang would have been total nonsense to someone in 2002.
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Since April’s not over yet, we can’t look at median home prices for the month. But we can look at data for March 2024, which just came out. Last month, the median existing home price was $393,500, according to the National Association of Realtors.
You might want to cover your eyes for this one. In March 2002, the median existing home sale price was $158,200, per the NAR.
OK, you might say, but what about inflation? Well, if we take that March 2002 median price and put it in 2024 dollars, we get $276,347. So it’s not just inflation, or that a dollar doesn’t buy as much as it used to. It’s that housing prices, particularly in the 2020s, have risen much faster than inflation overall.
Let’s look at how those prices would translate to costs at these two different points in time. We’ll assume a 7% mortgage rate, a 10% down payment, and to keep things a bit neater, we’ll set aside additional housing costs like property taxes and insurance and just look at principal and interest. At 2002 prices, monthly principal and interest would be $947. At today’s prices? That’ll be $2,356.
It’s not that the U.S. has never seen 7% mortgage interest rates before. It absolutely has, and it’s seen way worse than that — the all-time high was over 18% in 1981. What’s new is the combination of these interest rates and super-high home prices. With the median home price up 18.9% over the last three years, rates may not be great, but it feels like prices are the actual villain.
What’s a home buyer to do? Possibly look to new construction. While NAR data shows sales of existing homes were down in March, U.S. Census Bureau numbers find that sales of new homes were up. New builds may offer a friendlier environment for buyers. Home builders can offer buyer incentives like rate buydowns — and unlike many home sellers, they aren’t faced with also trying to buy a home in this market.
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Welcome to NerdWallet’s Smart Money podcast, where we answer your real-world money questions. In this episode:
Learn how scammers deceive victims by using AI for voice cloning and learn how you can protect yourself from other AI-related fraud.
How can you protect yourself from AI-driven scams that target your finances?
What new scams are happening as technology advances?
Hosts Sean Pyles and Sara Rathner discuss the alarming use of AI in scams and the future of fraud to help you understand how to safeguard your personal security. They begin with a discussion of AI-driven voice scams, with tips and tricks on recognizing potential fraud, staying informed about scam tactics, and the importance of open discussion to empower against scammer tactics.
Then, scam expert Bob Sullivan, author of “Stop Getting Ripped Off” and host of the podcast The Perfect Scam, joins Sean to discuss the broader implications of AI technology in scams. They discuss the potential for AI to personalize phishing attacks, the ease of creating convincing fake audio, and the importance of skepticism in the face of unexpected calls. Plus: the need for technology companies to embed safeguards, the role of societal learning in approaching unexpected calls, and the importance of verifying any financial requests you receive.
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Episode transcript
This transcript was generated from podcast audio by an AI tool.
Sean Pyles:
We already know that our robot overlords are coming, but in the meantime, while they plot, their artificial intelligence skills are being put to use by bad actors all over the world, utilizing technology to bilk people out of their money. That includes using AI to copy someone’s voice and demand ransom for a non-existent kidnapping.
Jennifer DeStefano:
I had a full conversation with my daughter. It was interactive. There was no pause. There was no break. There was nothing that would lead me to believe that it wasn’t her. So when the mom that stepped outside called 911, she came back in and she said, “Hey, 911 tipped me off that there’s a scam where they use AI and they can replicate anyone’s voice.” I didn’t believe it. It gave me hope, but I didn’t believe it.
Sean Pyles:
Welcome to NerdWallet’s Smart Money Podcast. I’m Sean Pyles.
Sara Rathner:
And I’m Sara Rathner. And Sean, that clip is as creepy as it gets.
Sean Pyles:
It is, and the story we’re going to hear today is as creepy and as awful as it gets as we wrap up our Nerdy deep dive into scams and identity theft and how to protect yourself from all of it so you don’t lose your life savings. Today we’re going to examine the future of the scam industry and the expanding role of AI.
Sara Rathner:
Yeah, I have to say, and I know you’ve touched on this in several of your interviews already, this is exhausting. I mean, it’s hard to listen to this and not think, yeah, no matter what, I’m screwed. They’re going to get me unless I spend all this time and effort protecting myself. And who has the time for that?
Sean Pyles:
I hear you, Sara, and it’s easy to feel somewhat defeated by all these organized criminals whose sole job is to steal our identities, which technology seems to make easier and easier for them, and to scam us in ways that we can’t even conceive of until it happens.
Sara Rathner:
I mean, I’d rather spend more time taking naps, honestly. I don’t do that enough and I’m really sleep-deprived, which is probably making me more susceptible to scams, honestly.
Sean Pyles:
Yeah, I am totally there with you. But Sara, I think we’ve also provided listeners, you included, with some really practical ways to fully arm ourselves that don’t take an undue amount of effort. And as we’ve been saying, one of the most important takeaways from this series, I think, is for everyone to realize that there is no immunity here. This stuff can happen to anyone regardless of how old you are, how much schooling you’ve had, or how much money you make, where you live. It’s a universal risk, and the more we talk about it, the more power we take away from the bad actors.
Sara Rathner:
All right. Well, the idea that AI is getting in on the action is slightly terrifying. You mentioned our robot overlords at the top of the show, and I guess they’re coming for everybody’s bank account PINs.
Sean Pyles:
If only it were that simple, Sara. AI is being deployed in sophisticated ways to manipulate our emotions, find vulnerabilities in software that we rely on every day, and generally make our lives like something out of that show Black Mirror. So in this episode, we’re going to explore things like how is AI being used in scams, what’s the deal with these AI voice scams and what hellish development might we see next in the world of scams. To start, we hear from a woman named Jennifer DeStefano. She lives in Arizona and had an experience that no one should ever go through, but that provides a window into one of the ways that scammers can reach into your heart and try to pull money from your bank account.
Sara Rathner:
All right. We want to hear what you think too, listeners. So tell us your stories of identity theft or getting scammed or share how you’re working to fight it or recover from it. Leave us a voicemail or text the Nerd Hotline at 901-730-6373. That’s 901-730-NERD. Or email a voice memo to [email protected]. Here’s Sean with our first guest.
Sean Pyles:
Jennifer DeStefano. Welcome to Smart Money.
Jennifer DeStefano:
Thank you so much for having me.
Sean Pyles:
So Jennifer, you experienced an AI voice scam. Can you set the scene for us? What was that day like before you got this phone call?
Jennifer DeStefano:
It was just a normal day. I had two children that were up training for a ski race and I had my daughter, she was at dance, so I was going to go pick her up and then hopefully joining my other two kids later in the weekend. So I went to pull up to the studio and get out of my car to go get her, and I got a phone call and it came in from an unknown number. Originally I was going to ignore it, but knowing that I had two of them that were practicing for a ski race and unknown can be medical, you just never know, just in case I decided to answer it.
When I answered it, I said hello, and I was getting out of my vehicle, so I had all my stuff in my hands. I was walking through the parking lot, so I had the phone on speaker and it was my older daughter crying and sobbing saying, “Mom, Mom, I messed up.” And I said, didn’t think anything of it. She ski raced for a number of years. It was a very familiar phone call. And I said, “Okay. What happened?” And she goes, “Mom, I messed up.” And I said, “Okay. What’d you do?” And then all of a sudden a man came on and he said, “Put your head down, lay back.”
And at that point I thought she got really hurt just being toboggan. So then I started to get really concerned. I’m like, “Wait, wait, wait. What’s going on? What’s happening, Bri? What’s going on?” And then this man gets on the phone as she starts saying, “Mom, help me. These bad men have me. Help me, help me, help me.” The phone, her voice starts to fade off with her crying and sobbing and pleading for me. And this man gets on the phone. He goes, “Listen here, I have your daughter.”
“You call the police, you call anybody, I’m going to pop her stomach so full of drugs and have my way with her and then drop her for dead in Mexico.”And at that point was when I had my hand on the door handle of dance, and I walked inside the room and I just started screaming for help. So fortunately there happened to be three other moms there that know me well. I was asking my younger daughter to get her dad on the phone, call her brother, call anybody. So she actually jumped up and ran over to my younger daughter to say, “Let’s go find your dad. Let’s figure this out.”
Another mom said, “I’m going to go call 911.” She stepped outside to go call the police, and the third mom sat beside me so she could hear everything the man was saying as I was trying to figure out where my daughter was, what’s going on.
Sean Pyles:
And so it’s a perfectly normal day. You’re about to get your kids after a day of them doing their activities, you get a phone call and within 30 seconds your world is turned upside down.
Jennifer DeStefano:
Completely upside down. I had no idea what was going on. I had a full conversation with my daughter. It was interactive. There was no pause. There was no break. There was nothing that would lead me to believe that wasn’t her. So when the mom that stepped outside called 911, she came back in and she said, “Hey, 911 tipped me off that there’s a scam where they use AI and they can replicate anyone’s voice.” She’s like, “It could have been a voice recording.” I’m like, “It was definitely not a voice recording. It was interactive. I was asking her questions. She was responding to me. It was not a recording.” And she’s like, “Well, they can do anything.” I’m like, “But it was her crying. It was her sobbing. I know it’s my daughter. It wasn’t a recording.”
Sean Pyles:
And what thoughts are going through your head as you’re having this conversation with what sounds exactly like your daughter?
Jennifer DeStefano:
I didn’t for a second not believe it. It wasn’t until another mom actually got my daughter on the phone and I talked to her and she reassured me that she was who she really was, and I could finally wrap my head around it. And then I finally believed her and then I knew it was a scam.
Sean Pyles:
How much time elapsed from the time that you answered the phone to when your actual daughter was speaking to you and you were reassured the phone call that you got wasn’t legitimate?
Jennifer DeStefano:
So the whole phone call actually took four minutes, but that’s where time freezes in that panic and fear.
Sean Pyles:
Right. Oh God, that’s heartbreaking. So do you know how the scammers got your daughter’s voice and maybe why they targeted you specifically?
Jennifer DeStefano:
So I had a bunch of different thoughts on that. Okay. She’s done a few interviews related to school, sports, whatnot, but that still doesn’t explain the crying and sobbing. It doesn’t explain that conversation. Her voice recording for her phone is her prepubescent voice, so it’s not her current voice. So I honestly have no idea. That’s where a lot of this, what’s scary is at first it was are they following me? Is it targeted? Do they know something? But then hearing how it had happened to a number of other people in different capacities, and you realize it’s a lot more arm’s length.
They were demanding money to be hand delivered to them. So they were making arrangements to come pick me up in a white van with a bag over my head. I had to have all the cash. They were going to take me to my daughter, and if I didn’t have all the cash, then we were both dead.
Sean Pyles:
God, how much were they asking for?
Jennifer DeStefano:
It was originally a million dollars. And then he came up with a number of $50,000 when I pushed back that that wasn’t possible.
Sean Pyles:
And to this day, it’s unclear why you specifically got this call?
Jennifer DeStefano:
I have no idea.
Sean Pyles:
Okay. And so after the phone call ended, I assume you hung up on the scammer when you realized that your daughter was safe.
Jennifer DeStefano:
So once I realized my daughter was safe, I actually had them on mute and they were furious that I wasn’t making final arrangements for a pickup. And then I picked the phone back up and I called them out and said, you don’t have my daughter, this is a scam and I’m going to make sure that this is going to come to a stop and I’m going to do anything I can to stop you. And I hung up on him.
Sean Pyles:
God, what are you on an individual or maybe even a family level doing to safeguard yourselves? Have you guys established a safe phrase that you might use to confirm your identities?
Jennifer DeStefano:
So we did create a safe word, and then it’s a lot of communication. Where are you? Who are you with? Where are you going? So that way if I do get a phone call or anybody gets a phone call, you can easily put it through the test. Does this make sense? Is this where they’re supposed to be? Is this even possible? Do you know the code word? Do you have some identifiers? If I didn’t know where my daughter was supposed to be, I wouldn’t have been able to locate her as fast as I did. And I had her brother, I had all of her siblings coming together in response to help me as well. So everybody was in full communication. You have to communicate and you have to seek help.
Sean Pyles:
Well, Jennifer, is there anything that you would like to leave listeners with?
Jennifer DeStefano:
Just awareness, have these conversations, sometimes maybe tough conversations, especially with children. But you have to have the conversations, have safe words, know where your kids are at. You have to have these conversations and make sure you safeguard your family.
Sean Pyles:
Well, Jennifer DeStefano, thank you for sharing your story with us.
Jennifer DeStefano:
Thank you so much for having me. I really appreciate it.
Sean Pyles:
Sara. I found this story just heartbreaking. I mean, at least they found out it was a scam before handing over money or before Jennifer offered herself up to scammers. But not everyone is so fortunate. Imagine how hard it is to say no to something like this when a loved one seems to be in jeopardy.
Sara Rathner:
Yeah, there was a piece recently in The Cut written by a journalist who knew she would never, ever fall for something like this. Don’t we all think that? And ended up handing over $50,000 in a shoebox to a stranger in a large SUV. I don’t think anybody ever sees themselves doing that. I’m glad Jennifer DeStefano didn’t let it get that far with the help of friends.
Sean Pyles:
And there’s hope that help will come from more than friends. Earlier this year the Federal Trade Commission proposed new rules that would prohibit the impersonation of individuals. It recently enacted rules that prohibit impersonating government or businesses. This proposed rule would extend to, well, us. The proposal is currently in a comment period, so if you feel so moved, go to the FTC’s website, ftc.gov, and comment.
Well, next we’re going to talk with another journalist, Bob Sullivan, who’s been covering the scam world for years now. He hosts a podcast for the AARP called The Perfect Scam and is the author of Stop Getting Ripped Off, among other books. We’re going to talk about the future of the scam world and how to protect yourself as technology continues to make it easier for the bad guys. That’s coming up in a moment. Stay with us.
Bob Sullivan, I’m so glad you could join us on Smart Money.
Bob Sullivan:
Thanks so much for having me.
Sean Pyles:
So Bob, the first question I have for you is how do I know that you are the real Bob Sullivan and not an AI-generated Bob Sullivan?
Bob Sullivan:
This is an excellent question and I’m glad that you’ve started there. You can’t, really. In fact, I did an episode on my own podcast recently where I had someone clone my voice and rather persuasively introduce the podcast, although family members pointed out to me that there were just little things that didn’t quite sound right. So either I was AI or maybe I had a bad cold or something. But it’s hard to tell, a little nasally.
Sean Pyles:
So in this series we’ve talked about identity theft, identity fraud, and the scam world, and I’m hoping that today you can give us a warning about the future of all of this and the role that artificial intelligence or AI is going to play and in fact is playing. So to start, when did we first start seeing AI being put to use in this way? Do you remember a specific AI-generated fraud or scam where you said, oh wow, this is something new?
Bob Sullivan:
Well, I have to be honest with you and say that I sit here reading emails about scams and fraud all day long, and I have not seen evidence of these kinds of things that a lot of folks are talking about right now, which is voice cloning or deep fake videos being used to fool people. Here’s a couple of things that I am worried about, however. All the data collection that we have, the criminals now have access to it and it’s going to be very easy for criminals to use that data to just really carefully craft their phishing pitches so that they’ll know exactly when you are transactional, for example.
Then they’ll know precisely when you order something from Amazon or what your zip code says about your income, and they’ll know how to attack the right person at the right time with the right message. And that’s the kind of artificial intelligence that I’m worried about, criminals using big data to essentially perfectly hone their crimes. But there’s one other thing that I’d really like to mention that enough experts have told me about that I am quite concerned about it, and that’s this idea of generative AI, where a tool like ChatGPT can engage in conversations and learn.
We have told people forever that one of the ways that they might recognize that they’re talking to a criminal over email or in chat or in a game is bad grammar or sentences that don’t quite make sense, non sequiturs. Well ChatGPT is getting very good at holding intelligent sounding conversations. Let’s start by saying it’s going to probably eliminate the bad grammar problem, but even more than that, imagine a tool that learns along the way just the right things to say to romance someone using a formula that’s been tested in the real world or the right things to say to get someone to follow the instructions for an investment scam.
I think these tools are going to learn how to carry on these conversations in ways that we’ve never seen at large scale, and that’s the kind of artificial intelligence that I’m worried about being used in scams.
Sean Pyles:
Okay. And can you talk us through how these AI voice cloning scams do work, whether they’re pervasive or not?
Bob Sullivan:
Sure. Well, I mean there are services, the fellow who did it on me signed up for a website that lets you do this for $5 a month and the first month is 80% off. So for literally one US dollar, you can upload samples of my voice or anyone’s voice and then generate for a potential scam victim, something that sounds incredibly realistic. I think the one thing that’s important to understand about what’s different about voice cloning, I don’t know if you remember the movie Sneakers, it’s one of my favorite hacker movies.
But in that movie, they basically needed a voice passport in order to enter a highly secure building, and they needed the authority figure to say things so that they could piece together cut and paste style a certain sentence, for example. So one way you might be imagining this works is someone tricks me into saying, my mother is in distress and I need you to send money to this wire account, but that’s not it. Instead, what’s powerful about AI voice cloning is with just a few sentences from me, they can extrapolate my intonation, my pausing and make me say anything.
So you don’t need a whole lot of vocabulary in order to make a really, really effective, almost fully independent voice clone.
Sean Pyles:
Well, I’d like to walk our listeners through some of the ways that fraudsters and scammers are putting this technology to work right now in ways that are shocking even to you. Can you share one or two examples that you know of that will give us a sense of just how bonkers this new era is?
Bob Sullivan:
Well, let me go back to the big data example. Foreign governments and large hacker organizations do have what would look to most people like a credit reporting agency on all of us. They have thousands of bits of data about all of us that they can use against us, and it’s data that they’ve been compiling for years. So they know what your tendencies are, they know where you shop, they know where you are. We never talk nearly enough about the theft of location data. All our cell phones are tracking devices.
And so a criminal could know when you’re walking past a store and send you a precisely timed invitation to either buy something at a discount or even worse to send you a note saying, I was just in Ireland. Bob, there’s a bank in Ireland that suddenly tried to charge a $2,000 charge to your account, say yes or no. And I would believe that message right now because I was just there. Those kinds of highly sophisticated, highly targeted crimes enabled by massive amounts of data that again can be searched now instantaneously, that’s the kind of thing that really scares me.
Sean Pyles:
And those examples are highly specific and individualized, which makes them all the more believable. So it makes it hard to trust anything that’s inbound to us.
Bob Sullivan:
Absolutely. And this is a tragedy because technology enables so many wonderful things. It is a terrible thing that we have all of these dark stories as this gray cloud around tech that’s going to prevent a lot of people from even trying to use it, and it’s going to make all of us feel just a little bit insecure because we know these sorts of bad and dangerous things can happen to us. The best example of this is in the health arena. We’re so far behind in what electronic health records could be in America right now.
When you go to the hospital, you’re laying on a gurney and there’s someone asking you over and over again, are you allergic to penicillin and you just were in a car accident. And that’s ridiculous. But because we are, I mean there’s many reasons, but a big one is we are so concerned about criminals misusing this data or companies misusing this data that we are decades behind where we could be with things like electronic health records.
Sean Pyles:
Earlier this episode, I spoke with a woman who received an AI voice scam call from what sounded like her daughter, and it of course wasn’t her daughter. But after everything settled down, she still doesn’t really understand how these people got her daughter’s voice. Her daughter isn’t really on social media, and this woman is also very unclear as to why she was targeted. So do you know how scammers are capturing people’s voices and why they might choose to target one person over another?
Bob Sullivan:
So I don’t know. I think for the vast majority of young people, it would be fairly trivial to examine a couple of TikTok videos and get enough voice sample in order to fake their voices. There are people who are not on social media and whose recorded voices aren’t in any, say, school websites or anything like that. I think they are few and far between. So I think most people should assume that a criminal could absolutely get enough audio samples of your voice to do this to you. So I can’t speak to that specific instance or why that person was targeted or why that child was targeted.
The only thing that concerns me is I don’t think we should give anyone the impression that this is happening on a widespread basis. It’s not. 99% of these kinds of calls are still being done by just human beings in boiler rooms. Nevertheless, this absolutely can be done. It can be done really inexpensively. And as I just mentioned, all of us are vulnerable to this. You’d be shocked at how much, even if you don’t have any social media, that pieces of your life have been posted by other people.
So it’s out there, and again, it takes very little, we’re talking probably less than a minute of audio in order to generate a fake you.
Sean Pyles:
What do you think we’re supposed to try to do to combat this? I mean, using me as an example, I host this podcast, you host one too. Our voices are out there just waiting for scammers to take a clip and make us say whatever they want, call our loved ones and use that voice to try to get their money. How do we fight that?
Bob Sullivan:
Yeah, you and I are screwed.
Sean Pyles:
Bob Sullivan:
Sorry. But the best, I talked to some other expert about this, so I can’t claim this advice myself, but I think it’s very good advice. At the beginning of the Photoshop era, people saw pictures of pyramids moved and weren’t skeptical of that. We just thought photographs couldn’t lie. I think nowadays for the most part, and certainly not everybody, for the most part, if you saw a crazy picture of Joe Biden riding on a camel or something, that there would be a piece of you at least that would say wait a minute, this might be fake.
There’s now an impulse that things you see might very well be faked. I’m hoping that our level of 21st century digital sophistication gets there quick enough with audio that your parents and my parents will have a predisposition to think if this is a weird phone call from Bob or Sean, it could be fake. And I think that’s the sort of learning curve we all have to go through kind of as a society.
Sean Pyles:
Well, let’s turn to some tactical ways that people can try to protect themselves. Can you tell us about the importance of things like pass keys, biometrics, other ways to authenticate that you are who you are when you get a call from someone or you allegedly call someone else?
Bob Sullivan:
I’m glad you brought that up. When it comes to voice printing in particular, there are these new technologies that are a little bit like image watermarking they’re discussing putting on voices. So you can imagine there being something even inaudible embedded in an audio phone call, which the technology company, the phone company, used seamlessly to verify that you were you, sort of like a Verisign email or whatnot. So there’s people who are working on technologies that would help with this verification. I’m not a fan of putting these really hard things onto individual consumers.
I think it’d be much better if the technology companies were forced to solve these problems because I can’t give my mom advice on how to verify how I might contact her at every platform that ever is going to exist. That advice is going to get outdated almost immediately.
Sean Pyles:
Given that we do live in this world that we are living in, I’m trying to think about ways that I can protect myself and my family. After I began doing research into 21st century scams, I established a safe phrase that if my family gets a call that alleges it’s from me and I’m in a panic, they’ll say, “Hey, what’s the safe phrase?” And I will tell them that phrase, if it’s actually me. And if it’s not, then the scammer’s going to try to divert them some other way, I’m sure.
Bob Sullivan:
I do think that’s great, and I don’t mean to trivialize any of that, but I would like to point out most people in security would say you’ve also created a vulnerability because someone armed with that phrase could easily disarm someone in your family, right?
Sean Pyles:
That’s true. Although the phrase has only been uttered in person when we agreed on what the phrase is. So we’ve tried to keep it as away from recording devices as possible to the extent that we can.
Bob Sullivan:
The only real point in my saying that was none of these things are foolproof. So it’s good to have that in mind. I think the one thing that helps all the time in the end, whatever we’re talking about here, almost inevitably, is a cover story for give me money. All of these, whatever technology we’re using, whatever the story is, in the end, there’s an ask of some kind. And stealing people against the ask is really, really important. And the best way to do that is interruption. The best way to do that is to train everybody in every circumstance, whatever is happening, to stop and talk to an independent third party, whether that be a family member or a financial professional or something.
Your son’s in jail in Europe, he needs bail money immediately, take the 15 seconds to talk to someone not involved in the situation and hear the words come out of your mouth. When you get a phone call you don’t expect, hang up and then go to the company’s website yourself and call the official published number, call the company back. That solves about 99% of these problems.
Sean Pyles:
Well, Bob, I’m asking this of all of the experts that we’re talking with for this series. So I’m going to ask you too, have you ever experienced a scam or identity theft or fraud?
Bob Sullivan:
No, but I’ve certainly been through a bunch of credit card-style identity thefts, but fortunately, knock on wood, nothing that we would consider deeply involved identity theft.
Sean Pyles:
Well, Bob, do you have any hopeful thoughts as we wrap up this series, which has been a bit of a bummer as we’ve talked about fraud and scams and people losing their life savings to technology assisted terrible people?
Bob Sullivan:
Yeah. So I spend all my week talking to people who’ve had their life savings stolen from them in all manner of speaking. It’s hard to stay optimistic. I think there’s a whole bunch of factors coming into play here. We have an aging population, many of whom thankfully have a lot of savings, they’re an easy target. And as I’ve mentioned, we have all of these tools that make it so much easier for someone halfway around the world to steal money instantly in untraceable ways. This has never happened in human history before, so this is the golden age of crime.
However, we are all talking about it now. So that’s really positive. Here’s the most optimistic thing I can tell you. Young people, software designers, engineers inside companies are now getting out of school having taken ethics classes and social impact classes and are starting to push back on their managers when they come up with tools like this. And that’s where the tide will turn is when enough people who have a grandparent who’s been a victim of a scam work at a software company and they say, we have to put this protection into this device before we release it to the world. And I do think those conversations are happening. So I am actually optimistic about that.
Sean Pyles:
That’s good to hear. And is there anything else that you wanted to mention that we didn’t touch on?
Bob Sullivan:
What we find is that a really, really big obstacle to fixing this problem is shame and embarrassment. Many, many people won’t come forward after they’ve been a victim of a crime like this because they feel stupid. I called myself stupid. All the language around scam crimes tends to focus on the individual instead of the system. Well, if you read a news story about a person who fell for a home improvement scam, that just doesn’t sound the same thing as someone who was robbed at gunpoint.
Sean Pyles:
Was the victim of a crime. That’s what happened at the end of the day.
Bob Sullivan:
They’re a victim of a crime, and we work hard on the language that we use to stress that there was a crime. There’s something about if we say, well, that person fell for this scam. Well, I would never fall for that scam. You can sort of put it at arm’s length, and that makes it a little easier to not do anything about the problem. And it takes the focus off the criminal. We kind of think the criminals are clever and sexy. But more than anything, we want to try to get away from the idea of shame because when someone is embarrassed because they are a victim of a crime, they don’t come forward.
The statistics don’t reveal the true nature and breadth of the crime. Everybody will tell you this, all this crime is wildly under reported. So however big the numbers seem to be, they’re at least double what we hear from the Federal Trade Commission and whatnot. And so anything that I can do to relieve the stigma from being a victim of crime like this, I’m all for it.
Sean Pyles:
Bob Sullivan, thank you so much for helping us out today.
Bob Sullivan:
Thanks a lot for having me.
Sean Pyles:
So Sara, after four episodes of hearing from experts and people who have experienced scams, I’m in a state of what I would call bleak optimism. The world right now is rife with scammers and their methods of duping innocent people are evolving at a rapid pace. But simultaneously, I can’t remember a time where scams and fraud were more present in the cultural conversation. Yes, it is fully a tragedy that our means of communication are so compromised that we cannot trust a call from a loved one in what seems like their most dire moment.
That really can’t be overstated. But hopefully the increased awareness of these scams will help people avoid sending money to bad actors and mitigate feelings of shame that people carry after enduring a scam. And hey, maybe one day our government will make some laws that help tamp down on the rampant scams that we’re all facing.
Sara Rathner:
And there’s this saying in journalism, if your mother tells you she loves you, fact check it. Well now you have to. So that’s the world we live in.
Sean Pyles:
If anyone contacts you at all, fact check it.
Sara Rathner:
Yeah. And text them on the side and be like, “Hey, are you calling me from jail right now?” And they’ll be like, “No.”
Sean Pyles:
I think the bottom line for everyone listening is to exercise extreme caution when you speak with anyone online and before you send money to anyone ever.
Sara Rathner:
If somebody is asking you for money and you don’t really know who they are, they are not who they tell you they are. How’s that? How’s that for general rule?
Sean Pyles:
All right. Well, for now, that’s all we have for this episode and this Nerdy deep dive about scams and ID theft and fraud. If you have a money question about any of this or anything else, turn to the Nerds and call or text us your questions at 901-730-6373. That’s 901-730-NERD. You can also email us at [email protected]. Visit nerdwallet.com/podcast for more info on this episode and remember to follow, rate and review us wherever you’re getting this podcast.
Sara Rathner:
This episode was produced by Tess Vigeland. Sean helped with editing. Kevin Berry helped with fact checking, Sara Brink mixed our audio.
Sean Pyles:
And here’s our brief disclaimer, we are not financial or investment advisors. This nerdy info is provided for general educational and entertainment purposes and may not apply to your specific circumstances.
Sara Rathner:
And with that said, until next time, turn to the Nerds.
When paying back your student loans, certain repayment strategies require a 10-day payoff letter. This is a document or statement that you can obtain through your original lender. It has the final loan amount needed to fully pay off your loan at a given time, and how to make the final payment and close the account.
Your 10-day payoff amount is typically more than just your current loan balance. For this reason, getting a 10-day loan payoff statement is the best way to find out how much you need to pay to fully satisfy the loan, including all accrued interest.
You typically need a 10-day payoff statement if you want to pay off your loan early or refinance your student loans. Here’s how to get it, what it contains, and other times when it might be required.
What Is a 10-Day Payoff for Student Loans?
Even if you understand the basics of student loans, you might not be clear on what a 10-day payoff letter is and why you would ever need one.
Used with many types of loans, a 10-day payoff statement tells you the amount you owe toward your loan in order for the loan to be closed and marked as “paid in full.”
A payoff statement is not the same thing at your current loan balance. Since interest is still charged on the loan in the days leading up to the actual payoff date, your lender will add 10 days’ worth of interest to your final payoff amount. Lenders can also calculate other time frames, like a 15- or 30-day payoff amount, if needed.
Depending on whether you have federal or private loans, your 10-day payoff letter might look visually different. Generally, it will contain your full name, student loan account number(s), outstanding balance, accrued interest, any fees, total payoff amount, a “good-through” or “good-until” date, and instructions on how to pay off your current loan.
The final payoff amount that’s listed includes interest for a 10-day period, and it might also include any unpaid fees. If your loan isn’t paid off in full by the “good-through date,” you’ll need to request another 10-day payoff from your current lender for the most accurate amount.
If after weighing the pros and cons of refinancing, you determine that a refinance will be to your advantage, you’ll likely need to get a 10-day payoff letter from your current lender or loan servicer. 💡 Quick Tip: Often, the main goal of refinancing is to lower the interest rate on your student loans — federal and/or private — by taking out one loan with a new rate to replace your existing loans. Refinancing makes sense if you qualify for a lower rate and you don’t plan to use federal repayment programs or protections.
Take control of your student loans. Ditch student loan debt for good.
When You Need a 10-Day Payoff Letter
Here’s a look at three reasons why you might need a loan payoff letter.
• You’re paying off your loans: If you’re able to put a chunk of money toward student loans to close out your debt ahead of schedule, you’ll need a 10-day payoff letter to get your true final amount due. That way, you’ll be able to make a final payment that fully satisfies the loan.
• You’re refinancing your student loans: If you opt for a student loan refinance, your refinance lender will likely require a 10-day payoff letter. This informs them of how much they need to send to your current lender, and by what date, to satisfy the debt.
• You’re buying a home: Mortgage lenders might ask to see your 10-day loan payoff amount to accurately determine your debt-to-income (DTI) ratio. Your DTI informs lenders about whether you can realistically afford taking on a home loan.
How to Request a 10-Day Payoff Letter
Despite having access to your loan details through a monthly statement or your servicer’s website, your actual 10-day payoff amount is likely different from the current amount shown on your account.
Fortunately, accessing this information is relatively easy, whether you have federal or private student loans.
For Federal Student Loans
As a federal student loan borrower, your federal student loan account was assigned to one of five federal loan servicers. To find your servicer, simply log in to your StudentAid.gov account, and go to “My Loan Servicers” from your dashboard.
Once you know who your servicer is, you can contact them to request a 10-day payoff letter.
Servicer
Support Phone Number
Aidvantage
1(800) 722-1300
Edfinancial
1(855) 337-6884
ECSI
1(866) 313-3797
MOHELA
1(888) 866-4352
Nelnet
1(888) 486-4722
For Private Student Loans
To get a 10-day payoff letter for a private student loan, you’ll want to contact your current lender. Keep in mind that your private loan might have been sold to a new lender since you first accepted it.
If you’re unsure about who your lender is, you can request a copy of your credit report at annualcreditreport.com . Your credit report will list all of your past and present debt accounts, including private student loans, and the entity that owns the loan.
After identifying your lender, you can contact their borrower support phone number to get a 10-day payoff statement.
What Is the Loan Refi Timeline After a 10-day Payoff?
The way student loan refinancing works is that you take out a new loan (ideally with a lower rate and/or better terms) and use it to pay off your current student loan(s). This doesn’t happen right away, however. There is generally a 10 day pay-off process.
To make sure your new lender fully pays off your old loan (and you won’t need to make any further payments on that loan), you’ll need a 10-day payoff letter. Once you’ve obtained your 10-day payoff amount and provided the information to your new lender, you’ll want to be sure to sign your loan agreement on the same day.
Once you sign the agreement, here’s a general idea of what the 10-day refi timeline may look like:
• Days 1 to 3: A three-day cooling-off period is required by law. During this time, your new lender cannot send your payoff check. This is just in case you change your mind about the refinance loan and exercise your right to cancel.
• Day 4: The refinancing lender will send a payoff amount in one lump sum, either as a mailed check or electronically, to your current lender or servicer. Typically, you’ll receive a welcome packet from your new lender soon after that.
• Day 10: Upon receiving the payoff amount in full, your current lender will mark the loan as “paid” and close it.
Your first payment on the new loan will likely be due 30 to 45 days after the date your refinance lender sent the payoff amount to your current lender. 💡 Quick Tip: Refinancing could be a great choice for working graduates who have higher-interest graduate PLUS loans, Direct Unsubsidized Loans, and/or private loans.
The Takeaway
A 10-day payoff letter tells exactly how much money you would need to pay immediately to fully satisfy your student loan debt. Refinance lenders usually require a payoff letter so they can fulfill the right payment amount on your behalf — no more, and no less, than your original lender requires to fully pay off your debt.
Knowing this final amount is also useful if you want to pay off your student loans ahead of schedule. You may also be required to submit a 10-day student loan payoff lender when you’re applying for a mortgage.
Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.
With SoFi, refinancing is fast, easy, and all online. We offer competitive fixed and variable rates.
FAQ
How do I get a 10-day payoff quote?
Depending on your lender, you may be able to request a 10-day payoff letter by signing into your account online. If not, you will need to call or email your current lender or loan servicer and request a 10-day payoff statement.
Why is my payoff quote so high?
Your 10-day student loan payoff amount is typically higher than your current principal balance due to added interest. Because interest is still charged on the loan in the days leading up to the actual pay-off date, your lender will include 10 days’ worth of interest to your final payoff amount.
What is on a 10-day loan payoff?
A 10-day loan payoff letter or statement will typically include:
• Student loan account number(s)
• Outstanding balance
• Accrued interest
• Any fees
• Total payoff amount
• A “good-through” date
• Instructions on how to pay off your current loan
Photo credit: iStock/andresr
SoFi Student Loan Refinance If you are a federal student loan borrower, you should consider all of your repayment opportunities including the opportunity to refinance your student loan debt at a lower APR or to extend your term to achieve a lower monthly payment. Please note that once you refinance federal student loans you will no longer be eligible for current or future flexible payment options available to federal loan borrowers, including but not limited to income-based repayment plans or extended repayment plans.
SoFi Loan Products SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.
Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Uneventfully Weaker Regardless of Durable Goods Data
By:
Matthew Graham
Wed, Apr 24 2024, 4:43 PM
Uneventfully Weaker Regardless of Durable Goods Data
Bonds were weaker in the overnight session on a combination of anxiety over potential sales of US Treasuries in Japan and European economic data. The domestic session brought actual selling of US Treasuries in the form of the 5yr Treasury auction, but the market already knew about that one. The auction was reasonably well received and had no impact on trading levels. Earlier in the morning, Durable Goods came out right in line with expectations and also had essentially no impact. Overnight weakness was maintained throughout the day with most of the momentum being sideways near recent highs yields.
Durable Goods
2.6 vs 2.5 f’cast
last month revised from 1.3 to 0.7
Durables, excluding defense and aircraft
0.2 vs 0.2 f’cast
last month revised from 0.7 to 0.4
09:06 AM
Weaker overnight and little-changed after AM econ data. 10yr yield up 4.1bps at 4.644. MBS down 6 ticks (.19).
10:51 AM
Weakest levels. MBS down 7 ticks (.22) and 10yr up 5.6bps at 4.657
01:04 PM
Boring 5yr auction. No major reaction. MBS down 5 ticks (.16). 10yr up 4.8bps at 4.649.
03:55 PM
Roughly unchanged from the last update and mostly flat since the late AM hours.
Download our mobile app to get alerts for MBS Commentary and streaming MBS and Treasury prices.
Average mortgage rates inched lower yesterday. But all that did was wipe out last Friday’s similarly tiny rise.
Earlier this morning, markets were signaling that mortgage rates today might barely budge. However, these early mini-trends often alter direction or speed as the hours pass.
Current mortgage and refinance rates
Find your lowest rate. Start here
Program
Mortgage Rate
APR*
Change
Conventional 30-year fixed
7.302%
7.353%
+0.01
Conventional 15-year fixed
6.757%
6.836%
+0.01
30-year fixed FHA
7.064%
7.111%
-0.07
5/1 ARM Conventional
6.888%
8.036%
+0.12
Conventional 20-year fixed
7.199%
7.257%
+0.05
Conventional 10-year fixed
6.663%
6.737%
+0.06
30-year fixed VA
7.292%
7.332%
+0.01
Rates are provided by our partner network, and may not reflect the market. Your rate might be different. Click here for a personalized rate quote. See our rate assumptions See our rate assumptions here.
Should you lock your mortgage rate today?
This morning’s Financial Times reports, “While the base case remains a reduction in borrowing costs, the options market shows a 20% probability of an increase.” That means most investors think the Federal Reserve will cut general interest rates this year, but they reckon there’s a 20% chance of the central bank actually hiking them. That’s new and scary.
Although the Fed doesn’t directly determine mortgage rates it has a huge influence on the bond market that does. And I very much doubt mortgage rates will fall consistently before the Fed signals that a cut in general interest rates is imminent. And a Fed rate hike is likely to send mortgage rates much higher: maybe back up to 8% or beyond.
So my personal rate lock recommendations remain:
LOCK if closing in 7 days
LOCK if closing in 15 days
LOCK if closing in 30 days
LOCK if closing in 45 days
LOCKif closing in 60days
However, with so much uncertainty at the moment, your instincts could easily turn out to be as good as mine — or better. So, let your gut and your own tolerance for risk help guide you.
>Related: 7 Tips to get the best refinance rate
Market data affecting today’s mortgage rates
Here’s a snapshot of the state of play this morning at about 9:50 a.m. (ET). The data are mostly compared with roughly the same time the business day before, so much of the movement will often have happened in the previous session. The numbers are:
The yield on 10-year Treasury notes edged down to 4.6% from 4.64%. (Good for mortgage rates.) More than any other market, mortgage rates typically tend to follow these particular Treasury bond yields
Major stock indexes were rising this morning. (Bad for mortgage rates.) When investors buy shares, they’re often selling bonds, which pushes those prices down and increases yields and mortgage rates. The opposite may happen when indexes are lower. But this is an imperfect relationship
Oil prices decreased to $81.59 from $82.06 a barrel. (Good for mortgage rates*.) Energy prices play a prominent role in creating inflation and also point to future economic activity
Goldprices fell to $2,333 from $2,350 an ounce. (Neutral for mortgage rates*.) It is generally better for rates when gold prices rise and worse when they fall. Because gold tends to rise when investors worry about the economy.
CNN Business Fear & Greed index — climbed to 40 from 33 out of 100. (Bad for mortgage rates.) “Greedy” investors push bond prices down (and interest rates up) as they leave the bond market and move into stocks, while “fearful” investors do the opposite. So, lower readings are often better than higher ones
*A movement of less than $20 on gold prices or 40 cents on oil ones is a change of 1% or less. So we only count meaningful differences as good or bad for mortgage rates.
Caveats about markets and rates
Before the pandemic, post-pandemic upheavals, and war in Ukraine, you could look at the above figures and make a pretty good guess about what would happen to mortgage rates that day. But that’s no longer the case. We still make daily calls. And are usually right. But our record for accuracy won’t achieve its former high levels until things settle down.
So, use markets only as a rough guide. Because they have to be exceptionally strong or weak to rely on them. But, with that caveat, mortgage rates today look likely to be unchanged or close to unchanged. However, be aware that “intraday swings” (when rates change speed or direction during the day) are a common feature right now.
Find your lowest rate. Start here
What’s driving mortgage rates today?
Today
This morning’s two April purchasing managers’ indexes (PMIs) will likely be good for mortgage rates. These “flashes” (initial readings and subject to revision) are both from S&P.
Here are this morning’s actual numbers in bold, alongside the prepublication consensus forecasts, according to MarketWatch, together with the March actual figures:
Services PMI — 50.9 actual; 52 expected; 51.7 in March
Manufacturing PMI — 51.1 actual; 52 expected; 51.9 in March
You can see that the PMIs were worse than expected, which is typically good news for mortgage rates.
Tomorrow
Tomorrow’s durable goods orders for March rarely affect mortgage rates. And they’d need to contain some pretty shocking data to do so tomorrow.
Markets are expecting those orders to have risen by 2.6% in March compared to a 1.3% increase in February. They’ll probably need to be significantly higher than 2.% to exert upward pressure on mortgage rates and appreciably lower to push them downward.
The rest of this week
Nothing has changed since yesterday concerning economic reports due on Thursday and Friday. So, I’ll repeat what I wrote yesterday:
We’re due the first reading of gross domestic product (GDP) for the January-March quarter on Thursday. And that could have a larger effect than PMIs and durable goods orders, depending on the gap between expectations and actuals.
But Friday’s personal consumption expenditures (PCE) price index for March is this week’s star report. That’s the Federal Reserve’s favorite gauge of inflation. And it could certainly affect mortgage rates, possibly appreciably.
The next meeting of the Fed’s rate-setting committee is scheduled to start on Apr. 30 and last two days. So, the PCE price index will be the last inflation report it sees before making decisions.
And index that shows inflation cooling could change the mood at that meeting. True, it’s vanishingly unlikely that a cut to general interest rates will be unveiled on May 1 no matter what.
But a PCE price index that shows inflation cooling could help the Fed to move forward with cuts earlier than expected, which should cause mortgage rates to fall. Unfortunately, one that suggests inflation remains hot or is getting hotter could send those rates higher.
I’ll brief you more fully on each potentially significant report on the day before it’s published.
Don’t forget you can always learn more about what’s driving mortgage rates in the most recent weekend edition of this daily report. These provide a more detailed analysis of what’s happening. They are published each Saturday morning soon after 10 a.m. (ET) and include a preview of the following week.
Recent trends
According to Freddie Mac’s archives, the weekly all-time lowest rate for 30-year, fixed-rate mortgages was set on Jan. 7, 2021, when it stood at 2.65%. The weekly all-time high was 18.63% on Sep. 10, 1981.
Freddie’s Apr. 18 report put that same weekly average at 7.1%, up from the previous week’s 6.88%. But note that Freddie’s data are almost always out of date by the time it announces its weekly figures.
Expert forecasts for mortgage rates
Looking further ahead, Fannie Mae and the Mortgage Bankers Association (MBA) each has a team of economists dedicated to monitoring and forecasting what will happen to the economy, the housing sector and mortgage rates.
And here are their rate forecasts for the four quarters of 2024 (Q1/24, Q2/24 Q3/24 and Q4/24).
The numbers in the table below are for 30-year, fixed-rate mortgages. Fannie’s were updated on Mar. 19 and the MBA’s on Apr. 18.
Forecaster
Q1/24
Q2/24
Q3/24
Q4/24
Fannie Mae
6.7%
6.7%
6.6%
6.4%
MBA
6.8%
6.7%
6.6%
6.4%
Of course, given so many unknowables, both these forecasts might be even more speculative than usual. And their past record for accuracy hasn’t been wildly impressive.
Important notes on today’s mortgage rates
Here are some things you need to know:
Typically, mortgage rates go up when the economy’s doing well and down when it’s in trouble. But there are exceptions. Read ‘How mortgage rates are determined and why you should care’
Only “top-tier” borrowers (with stellar credit scores, big down payments, and very healthy finances) get the ultralow mortgage rates you’ll see advertised
Lenders vary. Yours may or may not follow the crowd when it comes to daily rate movements — though they all usually follow the broader trend over time
When daily rate changes are small, some lenders will adjust closing costs and leave their rate cards the same
Refinance rates are typically close to those for purchases.
A lot is going on at the moment. And nobody can claim to know with certainty what will happen to mortgage rates in the coming hours, days, weeks or months.
Find your lowest mortgage rate today
You should comparison shop widely, no matter what sort of mortgage you want. Federal regulator the Consumer Financial Protection Bureau found in May 2023:
“Mortgage borrowers are paying around $100 a month more depending on which lender they choose, for the same type of loan and the same consumer characteristics (such as credit score and down payment).”
In other words, over the lifetime of a 30-year loan, homebuyers who don’t bother to get quotes from multiple lenders risk losing an average of $36,000. What could you do with that sort of money?
Verify your new rate
Mortgage rate methodology
The Mortgage Reports receives rates based on selected criteria from multiple lending partners each day. We arrive at an average rate and APR for each loan type to display in our chart. Because we average an array of rates, it gives you a better idea of what you might find in the marketplace. Furthermore, we average rates for the same loan types. For example, FHA fixed with FHA fixed. The end result is a good snapshot of daily rates and how they change over time.
How your mortgage interest rate is determined
Mortgage and refinance rates vary a lot depending on each borrower’s unique situation.
Factors that determine your mortgage interest rate include:
Overall strength of the economy — A strong economy usually means higher rates, while a weaker one can push current mortgage rates down to promote borrowing
Lender capacity — When a lender is very busy, it will increase rates to deter new business and give its loan officers some breathing room
Property type (condo, single-family, town house, etc.) — A primary residence, meaning a home you plan to live in full time, will have a lower interest rate. Investment properties, second homes, and vacation homes have higher mortgage rates
Loan-to-value ratio (determined by your down payment) — Your loan-to-value ratio (LTV) compares your loan amount to the value of the home. A lower LTV, meaning a bigger down payment, gets you a lower mortgage rate
Debt-To-Income ratio — This number compares your total monthly debts to your pretax income. The more debt you currently have, the less room you’ll have in your budget for a mortgage payment
Loan term — Loans with a shorter term (like a 15-year mortgage) typically have lower rates than a 30-year loan term
Borrower’s credit score — Typically the higher your credit score is, the lower your mortgage rate, and vice versa
Mortgage discount points — Borrowers have the option to buy discount points or ‘mortgage points’ at closing. These let you pay money upfront to lower your interest rate
Remember, every mortgage lender weighs these factors a little differently.
To find the best rate for your situation, you’ll want to get personalized estimates from a few different lenders.
Verify your new rate. Start here
Are refinance rates the same as mortgage rates?
Rates for a home purchase and mortgage refinance are often similar.
However, some lenders will charge more for a refinance under certain circumstances.
Typically when rates fall, homeowners rush to refinance. They see an opportunity to lock in a lower rate and payment for the rest of their loan.
This creates a tidal wave of new work for mortgage lenders.
Unfortunately, some lenders don’t have the capacity or crew to process a large number of refinance loan applications.
In this case, a lender might raise its rates to deter new business and give loan officers time to process loans currently in the pipeline.
Also, cashing out equity can result in a higher rate when refinancing.
Cash-out refinances pose a greater risk for mortgage lenders, so they’re often priced higher than new home purchases and rate-term refinances.
Check your refinance rates today. Start here
How to get the lowest mortgage or refinance rate
Since rates can vary, always shop around when buying a house or refinancing a mortgage.
Comparison shopping can potentially save thousands, even tens of thousands of dollars over the life of your loan.
Here are a few tips to keep in mind:
1. Get multiple quotes
Many borrowers make the mistake of accepting the first mortgage or refinance offer they receive.
Some simply go with the bank they use for checking and savings since that can seem easiest.
However, your bank might not offer the best mortgage deal for you. And if you’re refinancing, your financial situation may have changed enough that your current lender is no longer your best bet.
So get multiple quotes from at least three different lenders to find the right one for you.
2. Compare Loan Estimates
When shopping for a mortgage or refinance, lenders will provide a Loan Estimate that breaks down important costs associated with the loan.
You’ll want to read these Loan Estimates carefully and compare costs and fees line-by-line, including:
Interest rate
Annual percentage rate (APR)
Monthly mortgage payment
Loan origination fees
Rate lock fees
Closing costs
Remember, the lowest interest rate isn’t always the best deal.
Annual percentage rate (APR) can help you compare the ‘real’ cost of two loans. It estimates your total yearly cost including interest and fees.
Also, pay close attention to your closing costs.
Some lenders may bring their rates down by charging more upfront via discount points. These can add thousands to your out-of-pocket costs.
3. Negotiate your mortgage rate
You can also negotiate your mortgage rate to get a better deal.
Let’s say you get loan estimates from two lenders. Lender A offers the better rate, but you prefer your loan terms from Lender B. Talk to Lender B and see if they can beat the former’s pricing.
You might be surprised to find that a lender is willing to give you a lower interest rate in order to keep your business.
And if they’re not, keep shopping — there’s a good chance someone will.
Fixed-rate mortgage vs. adjustable-rate mortgage: Which is right for you?
Mortgage borrowers can choose between a fixed-rate mortgage and an adjustable-rate mortgage (ARM).
Fixed-rate mortgages (FRMs) have interest rates that never change unless you decide to refinance. This results in predictable monthly payments and stability over the life of your loan.
Adjustable-rate loans have a low interest rate that’s fixed for a set number of years (typically five or seven). After the initial fixed-rate period, the interest rate adjusts every year based on market conditions.
With each rate adjustment, a borrower’s mortgage rate can either increase, decrease, or stay the same. These loans are unpredictable since monthly payments can change each year.
Adjustable-rate mortgages are fitting for borrowers who expect to move before their first rate adjustment, or who can afford a higher future payment.
In most other cases, a fixed-rate mortgage is typically the safer and better choice.
Remember, if rates drop sharply, you are free to refinance and lock in a lower rate and payment later on.
How your credit score affects your mortgage rate
You don’t need a high credit score to qualify for a home purchase or refinance, but your credit score will affect your rate.
This is because credit history determines risk level.
Historically speaking, borrowers with higher credit scores are less likely to default on their mortgages, so they qualify for lower rates.
So, for the best rate, aim for a credit score of 720 or higher.
Mortgage programs that don’t require a high score include:
Conventional home loans — minimum 620 credit score
FHA loans — minimum 500 credit score (with a 10% down payment) or 580 (with a 3.5% down payment)
VA loans — no minimum credit score, but 620 is common
USDA loans — minimum 640 credit score
Ideally, you want to check your credit report and score at least 6 months before applying for a mortgage. This gives you time to sort out any errors and make sure your score is as high as possible.
If you’re ready to apply now, it’s still worth checking so you have a good idea of what loan programs you might qualify for and how your score will affect your rate.
You can get your credit report from AnnualCreditReport.com and your score from MyFico.com.
How big of a down payment do I need?
Nowadays, mortgage programs don’t require the conventional 20 percent down.
Indeed, first-time home buyers put only 6 percent down on average.
Down payment minimums vary depending on the loan program. For example:
Conventional home loans require a down payment between 3% and 5%
FHA loans require 3.5% down
VA and USDA loans allow zero down payment
Jumbo loans typically require at least 5% to 10% down
Keep in mind, a higher down payment reduces your risk as a borrower and helps you negotiate a better mortgage rate.
If you are able to make a 20 percent down payment, you can avoid paying for mortgage insurance.
This is an added cost paid by the borrower, which protects their lender in case of default or foreclosure.
But a big down payment is not required.
For many people, it makes sense to make a smaller down payment in order to buy a house sooner and start building home equity.
Verify your new rate. Start here
Choosing the right type of home loan
No two mortgage loans are alike, so it’s important to know your options and choose the right type of mortgage.
The five main types of mortgages include:
Fixed-rate mortgage (FRM)
Your interest rate remains the same over the life of the loan. This is a good option for borrowers who expect to live in their homes long-term.
The most popular loan option is the 30-year mortgage, but 15- and 20-year terms are also commonly available.
Adjustable-rate mortgage (ARM)
Adjustable-rate loans have a fixed interest rate for the first few years. Then, your mortgage rate resets every year.
Your rate and payment can rise or fall annually depending on how the broader interest rate trends.
ARMs are ideal for borrowers who expect to move prior to their first rate adjustment (usually in 5 or 7 years).
For those who plan to stay in their home long-term, a fixed-rate mortgage is typically recommended.
Jumbo mortgage
A jumbo loan is a mortgage that exceeds the conforming loan limit set by Fannie Mae and Freddie Mac.
In 2023, the conforming loan limit is $726,200 in most areas.
Jumbo loans are perfect for borrowers who need a larger loan to purchase a high-priced property, especially in big cities with high real estate values.
FHA mortgage
A government loan backed by the Federal Housing Administration for low- to moderate-income borrowers. FHA loans feature low credit score and down payment requirements.
VA mortgage
A government loan backed by the Department of Veterans Affairs. To be eligible, you must be active-duty military, a veteran, a Reservist or National Guard service member, or an eligible spouse.
VA loans allow no down payment and have exceptionally low mortgage rates.
USDA mortgage
USDA loans are a government program backed by the U.S. Department of Agriculture. They offer a no-down-payment solution for borrowers who purchase real estate in an eligible rural area. To qualify, your income must be at or below the local median.
Bank statement loan
Borrowers can qualify for a mortgage without tax returns, using their personal or business bank account as evidence of their financial circumstances. This is an option for self-employed or seasonally-employed borrowers.
Portfolio/Non-QM loan
These are mortgages that lenders don’t sell on the secondary mortgage market. And this gives lenders the flexibility to set their own guidelines.
Non-QM loans may have lower credit score requirements or offer low-down-payment options without mortgage insurance.
Choosing the right mortgage lender
The lender or loan program that’s right for one person might not be right for another.
Explore your options and then pick a loan based on your credit score, down payment, and financial goals, as well as local home prices.
Whether you’re getting a mortgage for a home purchase or a refinance, always shop around and compare rates and terms.
Typically, it only takes a few hours to get quotes from multiple lenders. And it could save you thousands in the long run.
Time to make a move? Let us find the right mortgage for you
Current mortgage rates methodology
We receive current mortgage rates each day from a network of mortgage lenders that offer home purchase and refinance loans. Those mortgage rates shown here are based on sample borrower profiles that vary by loan type. See our full loan assumptions here.
National mortgage rates moved higher for all types of loans compared to a week ago, according to data compiled by Bankrate. Rates for 30-year fixed, 15-year fixed, 5/1 ARMs and jumbo loans moved higher.
Some forecasters are rethinking the expectation that mortgage rates come down this year. Lenders price mortgages based on many variables, but overall, fixed mortgage rates follow the 10-year Treasury yield, which moves as investor appetite fluctuates with the state of the economy, inflation and Federal Reserve decisions.
“The issue of inflation remains unsettled,” says Ken Johnson of Florida State University. “This is putting upward pressure on mortgage rates through the yield on 10-year Treasurys.”
The Fed indicated it’d cut rates in 2024, but policymakers held off at its latest meeting, citing the need for more promising economic data. The Fed has been working to bring inflation back to its 2 percent target since 2022.
The Fed meets next on May 1 — the start of one of the busiest homebuying months.
Whether mortgage rates move up or down, though, it’s difficult to time the market. Often, the decision to buy a home comes down to what you need. Depending on your situation, it might make sense to take a higher rate now and refinance later. This way you can start building equity, rather than chancing that buying a home will become more affordable.
Rates accurate as of April 23, 2024.
These rates are marketplace averages based on the assumptions here. Actual rates available on-site may vary. This story has been reviewed by Suzanne De Vita. All rate data accurate as of Tuesday, April 23rd, 2024 at 7:30 a.m. ET.
Current 30 year mortgage rate moves upward, +0.17%
Today’s average 30-year fixed-mortgage rate is 7.30 percent, up 17 basis points over the last week. This time a month ago, the average rate on a 30-year fixed mortgage was lower, at 6.91 percent.
At the current average rate, you’ll pay principal and interest of $685.57 for every $100,000 you borrow. That’s an additional $11.51 per $100,000 compared to last week.
Most mortgage lenders defer to the 30-year, fixed-rate mortgage as the go-to for most borrowers because it allows the borrower to scatter mortgage payments out over 30 years, keeping their monthly payment lower.
15-year mortgage rate trends upward, +0.12%
The average rate for the benchmark 15-year fixed mortgage is 6.76 percent, up 12 basis points over the last week.
Monthly payments on a 15-year fixed mortgage at that rate will cost roughly $885 per $100,000 borrowed. That may squeeze your monthly budget than a 30-year mortgage would, but it comes with some big advantages: You’ll save thousands of dollars over the life of the loan in total interest paid and build equity much more rapidly.
5/1 adjustable rate mortgage advances, +0.10%
The average rate on a 5/1 adjustable rate mortgage is 6.89 percent, up 10 basis points from a week ago.
Adjustable-rate mortgages, or ARMs, are home loans that come with a floating interest rate. In other words, the interest rate will change at regular intervals, unlike fixed-rate mortgages. These loan types are best for those who expect to refinance or sell before the first or second adjustment. Rates could be considerably higher when the loan first adjusts, and thereafter.
While borrowers shunned ARMs during the pandemic days of super-low rates, this type of loan has made a comeback as mortgage rates have risen.
Monthly payments on a 5/1 ARM at 6.89 percent would cost about $658 for each $100,000 borrowed over the initial five years, but could climb hundreds of dollars higher afterward, depending on the loan’s terms.
Jumbo mortgage trends higher, +0.04%
The average jumbo mortgage rate is 7.44 percent, up 4 basis points over the last week. Last month on the 23rd, the average rate on a jumbo mortgage was lower at 7.02 percent.
At today’s average jumbo rate, you’ll pay $695.11 per month in principal and interest for every $100,000 you borrow. That’s up $2.73 from what it would have been last week.
Refinance rates
Current 30 year mortgage refinance rate rises, +0.20%
The average 30-year fixed-refinance rate is 7.31 percent, up 20 basis points since the same time last week. A month ago, the average rate on a 30-year fixed refinance was lower at 6.92 percent.
At the current average rate, you’ll pay $686.25 per month in principal and interest for every $100,000 you borrow. That’s an increase of $13.54 over what you would have paid last week.
Where are mortgage rates going?
If and when the Fed cuts interest rates depends on incoming economic data, such as the rate of inflation and the jobs market.
“While the majority of Fed members still expect three rate cuts this year, Atlanta Fed President Bostic is now predicting just one rate cut in the fourth quarter,” says Melissa Cohn of William Raveis Mortgage. “Not the news we want for the spring market.”
Keep in mind: The rates on 30-year mortgages mostly follow the 10-year Treasury, which shifts continuously as economic conditions dictate, while the cost of variable-rate home loans mirror the Fed’s moves.
These broader factors influence overall rate movement. As a borrower, you could be quoted a higher or lower rate than the trend based on your own financial profile.
What current rates mean for your mortgage
While mortgage rates change daily, it’s unlikely we’ll see rates back at 3 percent anytime soon. If you’re shopping for a mortgage now, it might be wise to lock your rate when you find an affordable loan. If your house-hunt is taking longer than anticipated, revisit your budget so you’ll know exactly how much house you can afford at prevailing market rates.
To help you uncover the best deal, get at least three loan offers, according to Freddie Mac research. You don’t have to stick with your bank or credit union, either. There are many types of mortgage lenders, including online-only and local, smaller shops.
“All too often, some [homebuyers] take the path of least resistance when seeking a mortgage, in part because the process of buying a home can be stressful, complicated and time-consuming,” says Mark Hamrick, senior economic analyst for Bankrate. “But when we’re talking about the potential of saving a lot of money, seeking the best deal on a mortgage has an excellent return on investment. Why leave that money on the table when all it takes is a bit more effort to shop around for the best rate, or lowest cost, on a mortgage?”
More on current mortgage rates
Methodology
Bankrate displays two sets of rate averages that are produced from two surveys we conduct: one daily (“overnight averages”) and the other weekly (“Bankrate Monitor averages”).
The rates on this page represent our overnight averages. For these averages, APRs and rates are based on no existing relationship or automatic payments.
Learn more about Bankrate’s rate averages, editorial guidelines and how we make money.
Discover methods to achieve financial harmony in relationships and why fiduciary advisors are often considered trustworthy.
Sara’s Corner: How can couples equitably share the mental load of managing finances? Can you trust fiduciary financial advisors? Hosts Sean Pyles and Sara Rathner begin with a discussion about the division of financial responsibilities among couples to help you understand how to create financial harmony in your relationship.
Today’s Money Question: Elizabeth Ayoola joins Sean to explain how you can choose a financial professional to work with, starting with an in-depth look at different types of fiduciaries including Certified Financial Planners (CFPs), financial coaches, and financial therapists. They discuss the nuances of fiduciary compensation structures and explain how you can advocate for yourself when selecting a financial advisor to work with.
Check out this episode on your favorite podcast platform, including:
NerdWallet stories related to this episode:
Episode transcript
This transcript was generated from podcast audio by an AI tool.
Sean Pyles:
Do you know which financial advisors you can trust and which might just be looking to make a buck? Well, this episode will help you sort the good from the sketchy in the world of financial advice.
Sara Rathner:
Welcome to NerdWallet’s Smart Money Podcast, where we help you make smarter financial decisions one money question at a time. I’m Sara Rathner.
Sean Pyles:
And I’m Sean Pyles. This episode, we’re joined by our co-host Elizabeth Ayoola to answer a listener’s question about fiduciary financial advisors. Are they all they’re hyped up to be and how do they compare to other folks looking to make money from giving advice?
Sara Rathner:
I would say the answer to those questions are usually, and they’re better, but I don’t want to steal your and Elizabeth’s thunder.
Sean Pyles:
I appreciate the restraint, Sara, even though you did just say those things.
But anyway, before we get into that, we’re going to hang out for a bit in Sara’s Corner. This is a thing I just made up where we hear from Sara about something that she recently wrote. Sara’s Corner, it’s cozy here.
Sara Rathner:
I mean, I do keep a blanket on the back of my desk chair, so it is cozy here.
Sean Pyles:
Sounds nice.
Sara Rathner:
Yeah. My corner is cozy and also may be full of emotionally fraught conversations because I do really like to write about couples and money, so let’s bring on the fighting.
Sean Pyles:
Yeah, that’s a good combination, I’d say.
So Sara, you recently wrote an article about how couples can share the mental load of money management. So to start, what inspired you to write this article? Are you giving us a peek into the Rathner household?
Sara Rathner:
Maybe a little deep down, but honestly, it’s really about what my social media algorithms are serving up lately, besides baby sleep experts and a little bit of Zillow Gone Wild, which is an account I highly recommend. So fun. You never know when an indoor pool’s going to pop up.
There are quite a few people who are influencer-type personalities who discuss topics like the mental load and emotional labor within families and within households, and it got me thinking about something that causes a lot of fights about who’s handling what task, and that is, as always, money.
Sean Pyles:
So in your article, you write that “Couples can fall into unproductive patterns that can lead to conflict, resentment, and even willful ignorance.” And this goes beyond money in a lot of relationships, and I do feel like this is something that anyone who’s been in a long-term relationship can relate to. So can you give us an example of one of these unproductive patterns and how can they be damaging to a relationship?
Sara Rathner:
One source I interviewed talked about what they called a manager-follower dynamic where one person in the couple is in charge and they delegate tasks to their significant other, and that’s fine at work. At home, it could also be fine depending on the task, but sometimes it could get a little icky, and even if one person is handling 100% of a task, you are both benefiting equally from that labor.
Sean Pyles:
Yeah. That reminds me of friends I’ve talked with who have found themselves in relationships with partners who really want a parent more than an actual partner, and that can be exhausting to deal with.
Sara Rathner:
Yeah, it’s totally fine to divvy up a task and have one person kind of be like, “I’m the point person for this, so if you have any questions about it, come and ask me,” but you’re agreeing to that together. It’s not this automatic, “Well, I’m the more adulty adult here and you act like a child, so I’m going to be your parent.” That’s a really gross dynamic to have in any romantic relationship. If you are in that right now, I don’t know, reconsider.
Sean Pyles:
Yeah, it can really strip away the romance from that relationship.
Sara Rathner:
Yeah, there’s nothing romantic about constantly reminding your partner to pick up their damn socks already. Adults can put socks in hampers, I’m just saying.
Sean Pyles:
That’s very true. Well, the hard thing is that with money, this can be a really easy dynamic to slip into because one person might know more about managing money than the other, so they end up just taking on all the money tasks or they delegate specific tasks to their partner, and if only one person knows about the finances of the household, that can be a very risky situation for both parties in the relationship.
Sara Rathner:
Exactly. And again, it’s totally fine and totally normal for one of you to feel more confident dealing with money. Maybe you’ve just managed your money differently back when you were single, maybe you work in finance. That is normal, but it’s still both of your responsibility.
And the same source that told me about the manager-follower dynamic also said to me that like any task, money tasks are things that you can learn by doing. So even if you are the less confident one in your relationship when it comes to these kinds of responsibilities, you can still grow your skill set. You can learn by doing. And so as you go forward in the future, you can take on more and more tasks with confidence and not fall into that dynamic where you’re constantly relying on the other person to tell you what to do.
Sean Pyles:
Let’s turn to some solutions. You first suggest that couples approach money as equals, which sounds great. Is the idea here that no one person in the relationship should have more power over their finances than another?
Sara Rathner:
Absolutely. The dynamic where one person handles everything and the other person could not be bothered to know the passwords to any accounts is not good. That’s not a healthy dynamic. At best, it’s unfair. The division of labor is, in that case, is putting a lot of that work on only one person’s shoulders, and at worst, it could be a sign of financial abuse. Withholding your partner’s access to finances is sometimes a situation where you are dealing with abuse and that’s something to keep your eyes open about. But even if your partner is totally happy to hand off the work and know nothing of the household finances, they could end up in a really tough spot if your relationship ends, either through divorce or breaking up or even if the partner passes away.
Sean Pyles:
So it might be a good idea for couples that are living together, have a long-term relationship, and have somewhat intermingled finances to even know the logins to each other’s accounts. Is that something that you’ve explored too?
Sara Rathner:
Yeah, you could even use a password manager to do that because you can share passwords with each other very easily or you could be really lo-fi about it and just have a list stored in a secure place like a safe that you keep updated once a year. You definitely want to both be equal partners in access to the money even if you don’t necessarily divvy up those month-to-month or week-to-week tasks equally.
Sean Pyles:
Well, what about actually getting those money tasks done? How should couples determine who does what?
Sara Rathner:
Well, this is where the whole money date thing comes, and we talk about this a lot. Sit down, pour yourself the beverage of choice, a cup of tea, a glass of wine, and have a chat about what bills are due, what savings goals you have, which kid has outgrown their clothes and needs to go shopping because that’s also a financial thing, all those sorts of money-related responsibilities that you have coming up in the next week, the next month, even the next three months. And in that conversation, you can also divide up the tasks.
Sean Pyles:
And it can be helpful to have different types of meetings at different times. Maybe once a quarter you have a higher-level meeting where you think about where you want to be at the end of that quarter or at the end of the year. And then at the beginning of each month, you can think, “Okay, here are the things we need to get done this month,” and then maybe even on a weekly basis, you can think more tactically around, “Okay, we need to get a bunch of whatever thing at Costco this week and that’s going to be a bigger bite out of our grocery budget, so let’s make sure we make room for that,” just so you have different conversations at different levels as you are managing your finances together.
Sara Rathner:
Yes, and I like to think of it in terms of that timeframe. What has to be done in the next few days, what has to be done this month, and then what’s a longer-term conversation?
Sean Pyles:
Well, this reminds me a little bit about how my partner and I manage other household tasks like doing the dishes, for example. In general, in our household, whoever cooks dinner does not have to load the dishwasher, and if you load the dishwasher, you don’t have to unload the dishwasher when it’s clean. And for us, it really comes down to being about balance.
Sara Rathner:
Exactly. And by splitting up responsibilities this way, you’re also acknowledging the labor that the person who cooked is performing. You do the dishes because you respect the work it took for the other person to cook. And in my house, because we have the baby to wrangle, I do most of the cooking. While I am doing that, my husband is handling the child care because I don’t want to stop cooking to change a dirty diaper because that’s unsanitary. So in our home, it’s this acknowledgement of, “You are 100% dealing with a baby and I’m 100% dealing with the cooking, and we have to split this moment up in order for us to get dinner on the table.”
Sean Pyles:
Well, do you have any other advice for how couples, or I guess anyone co-managing a household together, can find a more harmonious way to manage their finances?
Sara Rathner:
So another thing is once you divvy up those tasks during that money date, another really important thing is owning tasks that you agree to take on from start to finish. And this is where we talk about weaponized incompetence and all those psychological phrases that get thrown around on social media when you say you’re going to do something and you don’t do it and you’re, “Eh, it’s too hard.” No, it’s not.
Sean Pyles:
Just do it.
Sara Rathner:
Right. If you show your partner that you’re going to agree to do something and then you don’t do it to an agreed upon level of completion, you’re showing them that they can’t trust you.
So in your money date, not only do you talk about the major overarching tasks that you both need to complete, but you can break them down into subtasks so it doesn’t feel quite so intimidating. So if you’re the one to step up to own a task, that means you take care of it from start to finish, and it doesn’t mean you can’t ask for help if you get stuck. You are still partners, but you are just the one spearheading everything.
Sean Pyles:
Well, Sara, thanks for sharing your insights. I like hanging out in this corner with you. It’s cozy.
Sara Rathner:
I’ll bring a second blanket for next time-
Sean Pyles:
Thank you.
Sara Rathner:
… so we could build a fort together.
Sean Pyles:
I love it. And listener, if you want to check out Sara’s article, you can find a link to it in this episode’s show notes.
And now let’s check in on this month’s Nerdy question, which was what’s the best thing you spent money on this month? Last week, we heard from a listener who spent money on a third opinion from a doctor ahead of a major surgery and was able to find a more effective and less invasive way to resolve their pain. So hooray for taking charge of your own healthcare.
Sara Rathner:
And here’s what another listener texted us. “Hello. My favorite purchase so far is a used grand piano. I paid $4,000 and $1,000 to move it to my apartment on the third floor, no elevator, but it’s the best money I spent.” Wow. “I practice more than four times a week and it’s worth every penny.”
Sean Pyles:
Ugh, I love that this listener is spending money on something that is both a creative outlet and also likely a very beautiful thing to just have in their apartment. And I’m not going to pretend like spending $5,000 is nothing, it’s a significant chunk of change, but I’m willing to bet that they will get some good use out of it and it might just end up that they put some family photos on it eventually after the novelty of having a piano wears off, but still, it’ll be nice to look at.
Sara Rathner:
Also, I’ll say that having lived in a third-floor walk-up apartment, can I just say how impressed I am that it’s possible to get a grand piano up there? Because that was not what the staircase was like in the apartment building I was living in. Maybe you could hoist it through a window?
Sean Pyles:
Yes, I think you do have to do that. You take out the window. Sometimes you have to get a permit from the city. It can easily be $1,000 or more depending on where you are.
Well, listeners, we have so loved hearing from you and all of the great things that you are doing with your money. So to share the best thing that you spent money on last month, text us or leave a voicemail on the Nerd hotline at 901-730-6373. That’s 901-730-NERD, or email us a voice memo at [email protected].
Sara Rathner:
And while you’re at it, send us your money questions too. It is quite literally our job to answer them and we love to hear what situations you’re mulling over. So please tell us and we’ll try and solve these problems together.
Sean Pyles:
Well, before we get into this episode’s money question, we have an exciting announcement. We are running another book giveaway sweepstakes ahead of our next Nerdy Book Club episode.
Sara Rathner:
Our next guest is Jake Cousineau, author of How to Adult: Personal Finance for the Real World, which offers tips to young people on how to get started with managing their money.
Sean Pyles:
To enter for a chance to win our book giveaway, send an email to [email protected] with the subject “Book Sweepstakes” during the sweepstakes period. Entries must be received by 11:59 p.m. Pacific Time on May 17th. Include the following information: your first and last name, email address, zip code, and phone number. For more information, please visit our official sweepstakes rules page.
Now let’s get into my conversation with our co-host, Elizabeth Ayoola, about whether fiduciaries are all they’re hyped up to be.
We’re back and answering your money questions to help you make smarter financial decisions. And this episode’s question comes from Ian, who wrote us an email. Here it is. “Hi, team. I hear fiduciaries being peddled like some kind of miracle cure for financial planning, but I’m curious how being a fiduciary actually works. What is the enforcement mechanism? Is there a licensing body, like for nurses or doctors? What makes a fiduciary more trustworthy than someone who is making a promise that they totally have your best interest in mind? Cheers, Ian.”
Elizabeth Ayoola:
This is a good question to ask, especially if you’re trusting someone with your money. And I really like this topic because I recently covered it in a paraplanner course I’m taking. Sean, I know you’re also in the deep waters of coursework since you’re studying to become a certified financial planner professional, which is a fiduciary role. So you’re going to answer Ian’s question so we can test your knowledge.
Sean Pyles:
That is right.
Elizabeth Ayoola:
Sean Pyles:
A fiduciary is just a fancy term for someone who has an obligation, usually a legal or professional obligation, to put their client’s interests before their own. A fiduciary can be a doctor caring for your health, a family member managing someone’s estate, or in this case, a financial professional who is managing the personal finances of their clients.
Elizabeth Ayoola:
Okay. So in summary, a fiduciary prioritizes you and not their pockets.
Sean Pyles:
That is the idea and the hope, but there’s a little more to it than that, and I really have to hand it to this listener because I appreciate their skepticism about what it means to be a fiduciary because they are touted as the gold standard among financial advisors.
I also think we need to zoom out a little bit and talk about what it means to be a financial advisor because the term “financial advisor” is not regulated. Anyone can call themselves a financial advisor, even the sketchiest, hustle-culture peddlers on TikTok.
Elizabeth Ayoola:
I actually think we could do an entire episode on that, Sean. Right now there’s so many people sharing financial advice, and I’m afraid that people might not be doing enough vetting before taking these people’s financial advice, or even realizing that all advice shared doesn’t have their best interests at heart.
Sean Pyles:
Yeah. And as a side note, I’m not a fan of imposter syndrome, but the personal finance space is one where maybe more people should feel imposter syndrome because there are just too many people online without qualifications or experience telling others what to do with their money.
Elizabeth Ayoola:
I second that. And the wrong advice could really lead to great financial chaos for people, so they should absolutely be scared of sharing inaccurate or misleading advice.
Sean Pyles:
Totally. And if I’m being completely honest with myself, part of why I’m pursuing the CFP certification is to quell my own occasional imposter syndrome because I, as a professional in the personal finance space, want to get as much information as I can and I want to be as qualified as I can be to help others, but that’s just me holding myself to a very high standard that I think maybe other people should hold themselves to as well.
Elizabeth Ayoola:
And that’s why I like you, Sean. Okay, obviously there’s other reasons I like you too, but that’s exactly why I’m doing my qualification also because I want to share accurate advice with people. And I love to answer my friends and family’s finances questions when I can, so I want to make sure I actually know what I’m talking about.
Anyway, so back to our listener’s question. Ian wants to know how being a fiduciary actually works in the financial planning space. CFPs are a fiduciary, so how does that actually work in practice, Sean?
Sean Pyles:
Yeah, that’s a good question because Ian asked about licensing to affirm that someone is a fiduciary, and in the personal finance space, that usually means getting a CFP certification, which is the gold standard of education and conduct in the financial planning space. So please indulge me as I give you a sip of the Kool-Aid that I’ve been drinking during my CFP coursework, and I’ll explain what it means to be a certified financial planner professional/fiduciary.
Elizabeth Ayoola:
Come on. Tell us, Sean.
Sean Pyles:
Okay. So part of becoming a certified financial planner involves intensive education, passing a difficult exam, but then once you are certified, you have to act according to the Code of Ethics and Standards of Conduct that are outlined by the CFP Board. And there are three parts to this fiduciary duty that is also outlined by the Standard of Conduct.
So first, there’s a duty of loyalty, which states that a CFP professional has to put their client’s interests ahead of their own, like we talked about before. They also have to avoid, disclose, and manage conflicts of interest, and they must only act in the financial interest of the client, not themselves or the firm that they work for. They also have a duty of care, which basically mandates that the CFP professional has to be competent and do their best to help their clients meet their financial goals. Also, they have a duty to follow client instructions, where a CFP professional has to abide by the terms of the engagement with their clients.
Elizabeth Ayoola:
Wow, that is a lot, but honestly, it would give me confidence as a client to know that someone jumped through all those hoops for me.
Sean Pyles:
Yeah, and that’s really just scratching the surface, too. And the Standard of Conduct is a big part of why being a CFP is a big deal in the personal finance space.
Elizabeth Ayoola:
But here’s the thing, Sean, our listener, and to be honest, me too, is also wondering about enforcement. So let’s say a CFP professional decides to prioritize them making an extra dollar over what’s best for the client, and I don’t know, let’s say they push them into an investment or some kind of insurance product that isn’t actually a good fit for the client. What happens then? Do they call the cops? What do we do?
Sean Pyles:
The police are not involved in this unfortunately, but there is an enforcement mechanism at the CFP Board. If someone suspects that a CFP isn’t living up to their fiduciary responsibilities, they can file a complaint with the board and the board will investigate, and there are a number of disciplinary actions that it could take, including stripping someone of their certification.
The thing is, the onus is typically on the clients to file the complaints, and that’s part of why hiring a financial professional, hiring a CFP doesn’t mean that you can totally sit back and ignore your money. You still have to be engaged and monitor what’s going on.
Elizabeth Ayoola:
For sure, I learned that the hard way, so I try to learn things here and there. But thanks for explaining that.
I do have another question though. How would the client even know if they aren’t financially savvy or if they have a sketchy history? Are there some telltale signs?
Sean Pyles:
Yeah, this is the really tricky part, right? You’re going to this financial professional because of their expertise, so they probably know more about this topic than you do, and that can make it hard to know if they are BSing you or maybe more likely to violate their ethical duty later on. There are a couple of things that you can do though.
Before you even hire a financial professional, do your due diligence and shop around. I would recommend talking with a few different financial advisors before you decide which one you want to work with long-term. You can think of it like dating in that way. You want to get to know them and feel that you can trust them. And then once you are in this vetting process, I would say turn to our old friend Google and dig into each planner that you’re considering a little bit, like you would anyone that you’re dating. Verify that they actually have the certification that they say they do, and look and see if they’ve had any disciplinary actions that have been marked against them publicly. Also, you can just Google around and see if they’ve done anything else that you find suspicious or weird that you just aren’t on board with.
Elizabeth Ayoola:
Wow. I love those tips, Sean. And I also must say, when you said, “Your old friend Google,” it just reminded me about how long I’ve been in a long-term relationship with Google, but the tip’s definitely way more important. So basically, you’re telling us to put our investigator hat on. So okay, what’s the other thing you think people should do?
Sean Pyles:
Okay, so this might sound a little bit squishy, but go with your gut. If you talk with someone enough, you can probably tell if they aren’t confident in their grasp of the information they’re presenting. And even if they are, you might find that they just have a different money philosophy from you, which can signal that you guys are not compatible. For example, I once worked with a financial planner who suggested that I could take a 401(k) loan to solve a short-term cashflow issue that I had. And I personally happened to think that taking a loan against my own retirement for a problem that was going to work itself out anyway was an exceptionally bad idea, so I decided to work with another financial planner instead from that point on.
Elizabeth Ayoola:
Wow, that advice does not sound good, especially if it was suggested before exploring other alternatives that may not set you back for retirement. And I do understand that some people have to take out a loan against their 401(k), and that’s the only option that they have, but the downside is it might set you back, but I’m glad you went with your gut.
Sean Pyles:
Right. It wasn’t right from my circumstances or how I like to manage my money, and that’s what the bottom line was for me.
Now, so far, Elizabeth, we’ve been talking a lot about CFPs because that really is going to be the primary type of fiduciary that a lot of people looking for financial planning will encounter, but I want to go back to the idea that there are a lot of other people out there giving personal finance advice.
Elizabeth Ayoola:
Mm-hmm. People on TikTok, your nosy friends who are always getting in your business, the people interrupting my YouTube videos with their long-winded ads.
Sean Pyles:
Yes, but also accredited financial coaches and certified financial therapists. Both of those are fiduciaries, but they have different standards of conduct and enforcement mechanisms.
Elizabeth, I know that you have some experience working with financial therapists, so can you give us the rundown on what they do and why someone might benefit from working with one?
Elizabeth Ayoola:
I do, I do have experience with that, Sean. I am a wellness fanatic, that’s just a personal note, so I love the topic of financial therapy and also financial wellness. So essentially a financial therapist can help investors understand their worries and their fears around money. They also help you identify the feelings and the beliefs that you have around your money and your habits. Another way to put it is they help you identify and eliminate your money blocks, which are things getting in the way of you achieving your financial goals.
Sean Pyles:
And financial coaches are somewhere between a CFP and a financial therapist. They help people meet their financial goals, and they might be better suited to help those who aren’t super high-net-worth, don’t have a lot of investable assets. Accredited financial coaches also have a specific focus on diversity, equity, and inclusion, which is really important in the personal finance space, considering the racial and gender financial inequity in this country.
Elizabeth Ayoola:
Absolutely. They’re doing good work and we have a lot of work to do to close the gap, but as a woman and a Black woman at that, I hope we see more progress in coming years.
Sean Pyles:
So we’ve just run through a few different types of fiduciary financial professionals, and here’s my bottom line: if you are getting individualized financial advice, it’s probably for the best if that person is also a fiduciary because you know that that is a stamp of credibility, and it goes way beyond a financial influencer on TikTok telling you to sign up for their class and then peddling some investment account from a company that’s really just bankrolling their lifestyle.
Elizabeth Ayoola:
1,000%. I know me personally, I’m at a point where I’m growing wealth and I’m trying to make the right investment choices so I can see positive growth in the coming years. On that note, I would definitely go to a fiduciary if I was stuck trying to make a tough financial decision.
Sean Pyles:
Yeah. At the least, when you are receiving financial advice from someone, whether in person, on social media, or even on a podcast, I think people should ask themselves three questions: what is this person’s qualifications, how are they getting paid, and why are they doing this?
Elizabeth Ayoola:
I definitely think more people should ask those questions. But Sean, say more about that money part because that’s a big piece of the puzzle too.
Sean Pyles:
Yeah. Well, in the financial planning space, there are three main ways that people are compensated beyond a base salary. They can be fee-only, fee-based, and commission-based.
So when you meet with a fee-only advisor, they might charge you an hourly fee or a fee based on a certain percentage of your assets that they’re managing, maybe 1 or 2%. That’s pretty common. And fee-based is really similar, but there is a key difference, and that is that this advisor might get a commission from products that they sell you, like an insurance product or a specific investment account. And commission-based is exactly that: the advisor makes their money from selling financial products. So you can probably imagine why the commission-based pay structure gives some people pause.
Elizabeth Ayoola:
For sure. And then even if the advisor is a fiduciary, being commission-based could muddy the waters a little bit.
Sean Pyles:
Yeah. And for those who are really concerned about any conflicts of interest in the financial advisor space, fee-only might be the route where they feel most comfortable.
Elizabeth Ayoola:
Well, Sean, thank you for this rundown of what it means to be a fiduciary. Your coursework is courseworking, and I can see the studying is paying off. Do you have any final words?
Sean Pyles:
Yeah. I’d say that if you want a financial professional to help you with your finances, vet them thoroughly, shop around, and remember that at the end of the day, you have to be your own best advocate to get what you want from your money.
Elizabeth Ayoola:
Absolutely. And that’s all we have for this episode. Sean, thank you for educating we the people. Remember, we are here for you and we want to hear your money questions to help you make smarter financial decisions, so turn to the Nerds and call or text us your questions at 901-730-6373. That’s 901-730-NERD. You can also email us at [email protected], and also visit nerdwallet.com/podcast for more information on this particular episode. And remember to follow, rate, and review us wherever you’re getting this podcast.
Sean Pyles:
This episode was produced by Tess Vigeland and me. Sara Brink mixed our audio. And a big thank you to NerdWallet’s editors for all their help.
And here’s our brief disclaimer. We are not financial or investment advisors. This nerdy info is provided for general educational and entertainment purposes and may not apply to your specific circumstances.
Elizabeth Ayoola:
And with that said, until next time, turn to the Nerds.
Diversifying your assets is one of the best ways to create a sustainable, long-term investment strategy. And one of the ways you can do this is by buying gold.
Investing in gold and other precious metals is a great way to protect yourself against inflation. It also allows you to put your money in an asset that will likely continue to retain its value.
Despite the numerous benefits of investing in gold, many individuals remain uncertain about its viability as an investment and the process for getting started. In this article, we will outline a comprehensive guide on how to buy gold in 2024.
Why should I consider investing in gold?
With growing concerns of an impending recession, investing in gold has become increasingly relevant. This precious metal boasts a multitude of advantageous features that make it a valuable asset to any well-rounded investment portfolio. Here are four reasons why investing in gold is a wise choice:
Gold protects you from inflation: If you’re investing in the stock market, there’s a lot that’s outside your control. But gold is an asset you’ll always have some level of control over, regardless of what happens on Wall Street.
It retains its value: Because gold is much harder to obtain, it retains its value much longer. And you never have to worry about it decaying or losing its structure.
Gold is a high-demand product: There are many ways to use gold, and it tends to be a product that’s in high demand. This is especially true when economic conditions are tight.
Gold is an insurance policy: While some people purchase gold because they’re hoping to make a profit. Others like the security of owning gold and keep it as insurance in case of an economic downturn. Either strategy is an equally valid reason for gold investments.
How do I start investing in gold?
So now that you understand why gold is a good investment, it’s essential to know how to buy and sell gold, so you can get started. Listed below are five steps to make sure you get started on the right path.
Step 1: Decide What Type of Gold You Want to Buy
Start by deciding what kind of gold you would like to purchase. Each product will require a slightly different purchasing strategy, so you need to be clear on this right from the start.
Here are the main types of gold most people choose to invest in:
Gold bullion: When people think of owning physical gold, gold bullion is what usually comes to mind. It is a form of pure gold certified for weight and purity, typically in the form of bars.
Gold coins: A popular option for investors, gold bullion coins are easy to store due to their small size. They can be bought at a premium price and are readily available from reputable dealers.
Gold ETFs: For those not interested in directly owning gold, gold-based exchange-traded funds (ETFs) offer a convenient and cost-effective alternative. These shares can be bought and sold like stocks and are backed by a portfolio of gold-based securities.
Gold mutual funds: These mutual funds invest in companies involved in gold production, mining, and exploration. They may also invest in gold bullion, certificates, and derivatives.
Gold futures contracts: Gold futures are a type of futures contract allowing investors to buy or sell a specified amount of gold at a predetermined price and date in the future. They are best for experienced investors.
Gold jewelry: Accounting for 49% of global gold production, jewelry is a common form of gold ownership. However, it may not be the most profitable strategy, as retail jewelry prices come with substantial markups. Estate sales and auctions may offer better deals but require more time.
Gold mining stocks: With gold mining stocks, investors own a share in a gold mining company instead of the actual gold. These companies are large, global enterprises involved in the extraction and processing of gold ore. Investing in gold mining stocks is another way to profit from rising gold prices.
Gold IRAs: Similar to traditional retirement accounts, gold IRAs are backed by gold and other precious metals like silver, platinum, and palladium. They offer a unique investment opportunity for those looking to diversify their retirement portfolio. Here’s a list of the best gold IRA companies of 2024.
Step 2: Learn How Gold Prices Work
Before investing in gold, it’s essential to understand how gold prices work. The gold spot price, which reflects the cost of one ounce of gold, can fluctuate considerably based on market demand.
To ensure that you make wise investment decisions, research the market and stay up to date with its trends. In doing so, you’ll be poised to make the most of the opportunities presented by decreases in gold prices.
Step 3: Find a Trusted Seller
When investing in gold, you need to choose a trustworthy dealer. While purchasing gold online is convenient, be sure to exercise caution to avoid falling victim to scams.
To ensure that you purchase gold bullion or coins from a reputable source, consider consulting the U.S. Mint for a list of gold dealers in your area.
Once you have identified a potential dealer, make sure you evaluate their credibility. Gather information about their reputation through customer reviews and the Better Business Bureau.
It’s also a good idea to research the dealer’s buyback policies. Obtain a written copy of these policies and keep them in a safe place for future reference.
Step 4: Buy Physical Gold that You Can Sell
If you buy gold that is in demand, it will be easier when selling it at a later time. Stick to the most familiar gold coins and gold bars.
Gold Coins
The following are the most popular gold coins:
American Gold Eagle
Austrian Philharmonic
British Britannia
Canadian Maple Leaf
South African Krugerrand
Gold Bars
The most popular gold bullion bars include:
Credit Suisse
Perth Mint
Valcambi
Englehard
Johnson Matthey
PAMP Suisse
Step 5: Decide How You’ll Store the Gold
Finally, make sure you have a plan in place for storing your physical gold. Sticking several gold bars under your bed probably isn’t the wisest strategy. This puts you at greater risk of having your investment stolen.
Your best bet to store physical gold bars and coins is likely to purchase a safe for your home. You can also use a safe deposit box at a bank or rent a secure storage facility.
Conclusion
Investing in gold can be a rewarding journey, but only if you approach it with caution and foresight. First, decide the type of gold that aligns with your investment objectives, whether it be coins or bars, and make sure to source from a reputable dealer.
Additionally, consider the practical aspects of your investment strategy. For instance, if you opt for gold bars, consider the storage and security of your precious metal, and how you plan to sell it in the future. Gold bars can’t be easily divided, so take that into account.
Furthermore, you’ll need to factor in the rate of return on your gold investment. Ensure that the gold you purchase will not only keep pace with, but also surpass inflation, or you may end up with a loss in the long run.
And finally, avoid the common mistake of putting all your eggs in one basket, especially when it comes to gold investment. While gold and precious metals can be a lucrative component of your investment portfolio, they should never make up your entire investment strategy.
Frequently Asked Questions
Is gold a good investment?
Gold is a unique asset that doesn’t provide regular income in the form of cash flow, unlike other investments. However, owning gold can still have many advantages for your overall investment portfolio.
By including gold in your asset mix, you can diversify your investments and reduce your overall risk exposure. This is particularly important during times of economic uncertainty, such as a recession.
When other investments may perform poorly, gold has historically held its value, helping to protect and stabilize your wealth. This characteristic of gold makes it a useful tool for managing risk and preserving your wealth over the long term.
What is the best way to buy gold?
Acquiring gold can be a smart investment choice, but it’s essential to choose the right seller. Reputable sources include banks, investment firms, and online gold retailers.
To ensure you make a wise decision, do your due diligence and find a dealer with a good reputation, competitive pricing, and dependable customer support.
Furthermore, being aware of the current spot price of gold and market trends is crucial to making an informed purchase. Ultimately, the best form of gold to buy is the one that aligns with your investment objectives and needs.
How much gold should I buy?
Experts generally suggest investing 5% to 10% of your portfolio in gold. During economic downturns and periods of high inflation, some recommend allocating a larger portion.
The ultimate decision on how much to invest in gold should be based on personal financial objectives, comfort with risk, and available funds. As a diversification tool and a hedge against market instability, gold is a consideration worth making.
How much does gold cost per ounce?
Gold can experience significant price swings due to a multitude of factors. These include the ebb and flow of supply and demand, the fluctuation of currency exchange rates, and the instability of political climates.
The value of gold is expressed in U.S. Dollars and is most commonly reported in troy ounces, a unit equivalent to 31.1 grams. As of this writing, gold is priced at around $1875.00 per ounce.
What is the safest way to store gold?
For the ultimate protection of your gold investments, consider utilizing a secure depository, a bank safe deposit box, or an at-home safe.
Depositories provide comprehensive security and insurance coverage. They are an excellent option for safeguarding valuable assets.
Safe deposit boxes, located within banks, offer added protection with key-controlled access. An at-home safe, properly installed and maintained, can also provide a secure storage solution.
Whether you’re decorating on a budget, trying to be a little more conscious of your consumption, or simply love the thrill of hunting for those amazing, one-of-a-kind finds, thrift-store shopping can be a fun and smart way to create a signature aesthetic for your home. In addition to saving money by thrifting, you can also feel good about keeping items from ending up in a landfill by giving them a second life as part of your decor. But how do you get the best deals, what kinds of pieces should you hunt for and how can you style them without your own home looking like a thrift store? We did some digging to find out.
Looking for striking home decor? This is where pros shop in Dallas-Fort Worth
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The difference between thrift stores and consignment shops
Consignment and antique shops are great, but they tend to be pricier because their collections are curated. These stores do all the hunting down and fixing up for you, and that service is offset via higher price tags. While consignment shops are more likely to have highly sought after antiques from pedigreed brands, you can still certainly find hidden gems at nearly any thrift store — you just may have to put in more effort to find what you’re looking for. Balance the odds of what you want being there with the price range you’re willing to pay when deciding where to shop.
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Getting what you need while giving back to the community
Many of your favorite causes run thrift shops to help fund their programs and services. Prime Thrift near Fair Park benefits American Veterans (AMVETS), Disabled American Veterans (DAV) and other local and national charitable organizations, while Out of the Closet in Oak Lawn benefits the AIDS Healthcare Foundation. Genesis Women’s Shelter, a nonprofit that provides safety, shelter and support for women and children who have experienced domestic violence, operates two thrift stores: one in Oak Lawn and another in South Oak Cliff. There are four Soul’s Harbor locations throughout the metroplex, with proceeds going toward its programs to help men break the cycle of homelessness and addiction. Some of these shops even have exclusive relationships with estate liquidators, increasing your chances of finding treasures among their wares.
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If you’re looking for a bit more than just decor, check out your local ReStore, which benefits Habitat for Humanity. There, you can find actual building materials, such as tile, cabinets, wood flooring, windows, doors or even vintage brick. In addition to these, they also have plenty of new and vintage home furnishings, large appliances and more. With 10 locations across D-FW, it’s a convenient alternative to big-box stores when shopping for your next home design project.
Choose your shopping days wisely
For donation-based thrift stores, Mondays and Tuesdays are typically the best days to shop, because most people tend to drop off items early in the week after spending the weekend cleaning. Signing up for emails is a great way to stay on top of the latest finds and deals, but there’s just no substitute for going in regularly. It works the same with searching online, whether it’s eBay, Craigslist, or Facebook Marketplace. “I’m a huge fan of Facebook Marketplace” says Whitney Marsh, an interior designer and business owner who furnished her Oak Cliff coffee shop, B-Side, with thrifted finds. “I also really love Souls Harbor in Waxahachie,” Marsh notes.
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Have a strategy before you start shopping
There are two ways to go about hunting vintage pieces. Either have a piece or project in mind and know what you want to pay for it, or be able to spot a good deal. This can involve researching brands, pieces, and eras to be able to find your ideal mix of quality pieces that aren’t in demand. Marsh says that’s her strategy. “I know what I like, and I also know what brands are known for quality goods,” she explains. “I definitely have a style. I’m drawn toward leather furniture, solid wood, wool rugs and unique art.”
For example, you may love midcentury modern (MCM) pieces, but the popularity of decor from that era means there’s more demand, and unscrupulous sellers may assign that label to random items in order to get them to sell. You may find more success by researching some favorite brands or designers from the MCM era and looking for those specifically to avoid fake listings and inflated prices. Be aware that people will list items online with a famous brand name keyword to get more hits, such as saying a “Pottery Barn-style” rug or “MCM-style lamp.” If you’re shopping in person, don’t be afraid to ask the store’s staff about an item you’re looking for; they may have something similar that just hasn’t been put out yet. Or, they might be willing to take down your name and keep an eye out for items on your list — especially if you’re a regular customer.
Simple design rules to consider
Once you’ve found that unique piece you’ve been searching for, how do you style it? Thrifted pieces bring character into a space, but it is possible to have too much of a good thing, says Marsh. “I like to pair thrifted pieces with more high-end textiles. I love an old leather sofa that’s worn in against a very bold luxury wallpaper.” If you buy a well-worn piece and want to play up that lived-in aesthetic, try to surround it with items that are clean and modern. Too much rusticity can end up looking like neglect. Same goes for smaller items, such as pots, frames or books — space them out in designed vignettes throughout your home instead of clustering them all together. Also, keep in mind that pairing thrifted furniture is easier when they share some similar elements. For example, mismatched nightstands look more cohesive if they are roughly the same size and color.
Thrifting can be a way to save big, depending on when and where you shop, and what you’re looking for. “I definitely shop with a specific corner or space in mind. I also really only pull the trigger on things that seem like they’re good quality and the right price,” says Marsh. But if you’re patient, persistent and know what you want and what you’re willing to pay for it, it’s just a matter of time before you find it.
Our goal here at Credible Operations, Inc., NMLS Number 1681276, referred to as “Credible” below, is to give you the tools and confidence you need to improve your finances. Although we do promote products from our partner lenders who compensate us for our services, all opinions are our own.
Home equity loan
Home equity line of credit (HELOC)
Interest rate
Fixed
Variable
Monthly payment amount
Fixed
Variable
Closing costs and fees
Yes
Yes, might be lower than other loan types
Repayment period
Typically 5-30 years
Typically 10-20 years
FAQ
What is a rate lock?
Interest rates on mortgages fluctuate all the time, but a rate lock allows you to lock in your current rate for a set amount of time. This ensures you get the rate you want as you complete the homebuying process.
What are mortgage points?
Mortgage points are a type of prepaid interest that you can pay upfront — often as part of your closing costs — for a lower overall interest rate. This can lower your APR and monthly payments.
What are closing costs?
Closing costs are the fees you, as the buyer, need to pay before getting a loan. Common fees include attorney fees, home appraisal fees, origination fees, and application fees.
If you’re trying to find the right mortgage rate, consider using Credible. You can use Credible’s free online tool to easily compare multiple lenders and see prequalified rates in just a few minutes.