Capital One is offering a signup bonus of up to $3,000 signup bonus on their business Spark Cash Plus card, as follows:
$1,500 once you spend $20,000 in the first 3 months.
An additional $1,500 once you spend $100,000 in the first 6 months.
Card Details
$150 annual fee not waived
Card earns 2% cash back on all purchases
Earn an annual $200 cash bonus every year you spend $200,000 or more
Card earns cashback; if you have a different points-earning Capital One card (such as the Venture or Spark Miles), you’ll be able to transfer over the cash back into miles which could be more valuable
Our Verdict
Both of these tiers might make sense for someone with a lot of unbonused spend. The lower tier is a really nice deal for cashback – you’ll get 9.5% cashback on $20,000 in spend. This is better than prior offers we’ve seen. Personally I can’t do the $100k tier, but I’m going to try getting approved and doing the $20k spend tier. (In the past I haven’t had great luck getting approved with Capital One. 🙁 )
Another option is a newly launched similar bonus on the Venture X Business card.
Remember, Capital One pulls all 3 credit bureaus. Unlike most Capital One business cards, Spark Cash cards do not report the statement balances to the personal bureaus; see these Things to Know About Capital One Credit Cards before applying. We’ll add this to our List of Best Credit Card Signup Bonuses.
A number of closely followed mortgage rates fell over the last week. Average 15-year fixed mortgage rates climbed, while average 30-year fixed mortgage rates trailed off, while
For variable rates, the 5/1 adjustable-rate mortgage decreased.
30-year fixed mortgage: 7.00%
15-year fixed mortgage: 6.46%
5/1 adjustable-rate mortgage: 6.37%
In November, the average rate for a 30-year fixed mortgage started making sustained drops from its earlier peak of 8%. The most common home loans are now in the 6% to 7% range. Yet the mortgage market always has some level of volatility, and rates have already started inching back up at the start of this year.
“It’s not uncommon to see a shift in the pattern for interest rates in January, sometimes positive, sometimes not,” said Keith Gumbinger, vice president of mortgage site HSH.com.
The current housing market is difficult. High mortgage rates, expensive home prices and tight inventory are keeping homebuying out of reach for many. If you’re looking to buy a home, don’t try to time the market. Instead, experts recommend patience and preparation: Figure out what you can afford and take steps to improve your financial situation.
About these rates: Like CNET, Bankrate is owned by Red Ventures. This tool features partner rates from lenders that you can use when comparing multiple mortgage rates.
Today’s average mortgage interest rates
If you’re in the market for a home, check out how today’s mortgage rates compare to last week’s. We use rates collected by Bankrate to track daily mortgage rate trends. This table summarizes the average rates offered by lenders across the US:
Today’s mortgage interest rates
Loan term
Today’s Rate
Last week
Change
30-year mortgage rate
7.00%
7.02%
-0.02
15-year fixed rate
6.46%
6.39%
+0.07
30-year jumbo mortgage rate
7.05%
7.06%
-0.01
30-year mortgage refinance rate
7.21%
7.15%
+0.06
Rates as of Jan. 19, 2024
How to choose a mortgage
When picking a mortgage, consider the loan term, or payment schedule. The most common mortgage terms are 15 and 30 years, although 10-, 20- and 40-year mortgages also exist. You’ll also need to choose between a fixed-rate mortgage, where the interest rate is set for the duration of the loan, and an adjustable-rate mortgage. With an adjustable-rate mortgage, the interest rate is only fixed for a certain amount of time (commonly five, seven or 10 years), after which the rate adjusts annually based on the market’s current interest rate. Fixed-rate mortgages offer more stability and are a better option if you plan to live in a home in the long term, but adjustable-rate mortgages may offer lower interest rates upfront.
30-year fixed-rate mortgages
The average interest rate for a standard 30-year fixed mortgage is 7.00%, which is a decrease of 2 basis points from one week ago. (A basis point is equivalent to 0.01%.) A 30-year fixed mortgage is the most common loan term. It will often have a higher interest rate than a 15-year mortgage, but you’ll have a lower monthly payment.
15-year fixed-rate mortgages
The average rate for a 15-year, fixed mortgage is 6.46%, which is an increase of 7 basis points from seven days ago. Though you’ll have a bigger monthly payment than a 30-year fixed mortgage, a 15-year loan usually comes with a lower interest rate, allowing you to pay less interest in the long run and pay off your mortgage sooner.
5/1 adjustable-rate mortgages
A 5/1 adjustable-rate mortgage has an average rate of 6.37%, a slide of 4 basis points compared to last week. You’ll typically get a lower introductory interest rate with a 5/1 ARM in the first five years of the mortgage. But you could pay more after that period, depending on how the rate adjusts annually. If you plan to sell or refinance your house within five years, an ARM could be a good option.
Calculate your monthly mortgage payment
Getting a mortgage should always depend on your financial situation and long-term goals. The most important thing is to make a budget and try to stay within your means. CNET’s mortgage calculator below can help homebuyers prepare for monthly mortgage payments.
What is influencing mortgage rates right now
Mortgage rates were near record lows, around 3%, at the start of the pandemic. That changed as inflation surged and the Federal Reserve kicked off a series of aggressive interest rate hikes, which indirectly drove up mortgage rates. Now, mortgage rates are still more than double what they were just a few years ago.
However, with the central bank keeping interest rates steady since late July, mortgage rates finally saw some sustained decreases in the fall. With the Fed planning to announce its next policy move in late January (and again in mid-March), experts are waiting for the first interest rate cut. It may be months before that happens, but mortgage rates could stabilize and start inching even lower in the coming months.
““The history of economic cycles has taught us that when the markets believe the Fed is done hiking rates, [mortgage rates] make a big move lower before rate cuts happen,” said Logan Mohtashami, lead analyst at HousingWire.
What affects mortgage rates?
Federal Reserve monetary policy: The nation’s central bank doesn’t set interest rates, but when it adjusts the federal funds rate, mortgages tend to go in the same direction.
Inflation: Mortgage rates tend to increase during high inflation. Lenders usually set higher interest rates on loans to compensate for the loss of purchasing power.
The bond market: Mortgage lenders often use long-term bond yields, like the 10-Year Treasury, as a benchmark to set interest rates on home loans. When yields rise, mortgage rates typically increase.
Geopolitical events: World events, such as elections, pandemics or economic crises, can also affect home loan rates, particularly when global financial markets face uncertainty.
Other economic factors: The bond market, employment data, investor confidence and housing market trends, such as supply and demand, can also affect the direction of mortgage rates.
Mortgage rate forecasts from experts
While mortgage forecasters base their projections on different data, most predict rates will remain near or above 7% for the rest of 2023. Here’s a look at where some of the major housing authorities expect average mortgage rates to land at the end of the year.
How to find the best mortgage rates
Though mortgage rates and home prices are high, the housing market won’t be unaffordable forever. It’s always a good time to save for a down payment and improve your credit score to help you secure a competitive mortgage rate when the time is right.
Save for a bigger down payment: Though a 20% down payment isn’t required, a larger upfront payment means taking out a smaller mortgage, which will help you save in interest.
Boost your credit score: You can qualify for a conventional mortgage with a 620 credit score, but a higher score of at least 740 will get you better rates.
Pay off debt: Experts recommend a debt-to-income ratio of 36% or less to help you qualify for the best rates. Not carrying other debt will put you in a better position to handle your monthly payments.
Research loans and assistance: Government-sponsored loans have more flexible borrowing requirements than conventional loans. Some government-sponsored or private programs can also help with your down payment and closing costs.
Shop around for lenders: Researching and comparing multiple loan offers from different lenders can help you secure the lowest mortgage rate for your situation.
In 2024, the world of design is evolving — the 2023 design trends that once seemed evergreen are proving themselves out of fashion fast. Designers are leading a creative revolution, saying goodbye to certain decor trends that have been around for too long. Let’s explore the shifts and innovations that will redefine our living spaces this year.
The saturation of grays, greiges and beiges
The subdued palette that dominated 2023 is now experiencing a sense of saturation. While these neutrals are timeless, their overuse, especially within the realm of minimalism, has rendered them somewhat uninspiring. Consider infusing vitality into your color scheme with bold and saturated hues. Also, explore the rich spectrum of nature-inspired tones to breathe life into your living spaces. Jewel tones also contrast beautifully against most gray wall colors and add more personality.
Checkered pattern play and chevron prints have a checkered past
The once-revitalizing checkered pattern in home decor has become a victim of its own popularity. We have to say the same for the once-popular chevron print that found its way onto rugs, walls and decor items, too. Instead of continuing with this trend, opt for textural fabrics like natural linen. This shift provides a refreshing departure from the ubiquitous checkered aesthetic while maintaining a touch of vintage charm.
Overly coordinated decor
The meticulous coordination of every element in a space, a hallmark of 2023, is now on the wane. Beyond the significant investment of time and money, overly coordinated decor tends to create impersonal and somewhat sterile living environments. Embrace maximalism, which encourages an eclectic and personalized approach. It injects warmth and character, transforming spaces into inviting havens. While we can’t really say that minimalism itself is out, the aesthetic’s leaning toward over-coordination is.
Saying sayonara to impersonal spaces
Hiding personal touches within homes, a trend of 2023, is giving way to a more authentic and open expression of individuality. In 2024, the focus is on showcasing personal style, memories and uniqueness through decor. Consider creating a gallery wall that tells your story with pride. This departure from impersonal spaces contributes to a more emotionally resonant and visually captivating living environment.
Overestimating our green thumb
While plants undoubtedly enhance interiors, the misconception of universal gardening expertise can lead to the neglect of these green companions. Instead of overestimating our green thumbs, we recommend taking an honest assessment of how much plant care you can handle. Start small with low-maintenance plants like succulents, gradually incorporating them into your decor for a harmonious and vibrant atmosphere.
Style over comfort
The dominance of style over comfort in 2023 is evolving. The realization that a truly inviting living space should prioritize comfort and functionality is gaining traction. Investing in multifunctional furniture is a key shift, ensuring that pieces look good while enhancing the overall living experience. This move towards comfort signifies a departure from purely aesthetic-driven choices.
Choosing trendy over timeless
The inclination to chase trends is losing ground to a preference for timeless design elements, such as the transitional design style. The recognition that trendy pieces can quickly make a space feel outdated and impersonal is driving a shift towards enduring choices. Embrace mid-century modern design, sustainable pieces and neutral rugs for a timeless and enduring aesthetic.
Is gold gaudy in 2024?
Gold, as a timeless element, remains in vogue, but the gaudy and flashy manifestations are making way for more subdued and sophisticated design choices. The desire for a balanced and refined atmosphere has prompted a departure from the excessive use of brassy gold pieces everywhere — instead choosing a more burnished gold look. Opt for timeless and versatile gold accents that contribute to an elegant and harmonious living space.
Image source: ELLE Decor
Embracing bold statements of 2024
As we bid farewell to our once-beloved 2023 design trends, there’s a resounding call to embrace designs that have a striking impact. Vibrant color choices, daring patterns and eye-catching focal points are becoming central to creating memorable aesthetics.
This movement invites individuals to step into the role of interior designers, breaking free from the mundane and infusing spaces with a daring, expressive approach. The power of bold statements is set to elevate our living spaces and leave a lasting impression in the unfolding narrative of 2024.
Make a new statement with a new apartment
If you’re still on the quest for a new living space, explore the available apartments and homes for rent. It’s an opportunity to infuse your creative touch and turn your dream rental into a personalized haven.
Republic Day, observed on January 26, is commemorated with parades and celebrations honouring India’s diverse cultural heritage. It is well worth seeing the magnificent Republic Day parade, which is customarily staged on the main Rajpath avenue and includes the Army, Navy, and Armed Forces in their full splendour. The parade’s major attractions include traditional dance troupes and floats from every state, along with a sky display by helicopters. As we approach the joyous occasion of Republic Day, let’s channel our love for the nation into the very fabric of our homes. Elevate your living space with a fusion of cultural aesthetics, vibrant furniture, and cosy textiles. (Also read: Republic Day 2024: 10 creative and easy-to-make drawing ideas for kids to celebrate the nation’s pride )
Creative home decor ideas for Republic Day
1. Tricolour cushions
On Republic Day, everything takes on the colours of the Indian national flag. So why leave your house? While it’s rare to redecorate the whole room every year, you can show your love for the national colours by bringing out cushions in white, green and saffron. Use white cushions, green plants and saffron bed linen in your master bedroom to create a festive and patriotic atmosphere.
Stay tuned for all the latest updates on Ram Mandir! Click here
2. Floral decor
Who doesn’t love flowers? With their enchanting scent and vibrant colours, they can instantly create a festive mood. For a tricolour look, use marigolds, jasmine and green foliage and finish the arrangement with a flag. Whether you make a floral rangoli or create a tricolour flag with flowers, your home is sure to be ready for R-Day.
3. Paper flower decorations
If you enjoy crafts, try making paper roses with coloured crepe paper, glue and wire. Use these paper flowers to decorate your home. You can make a string of flowers to hang in your window, or use them as a bouquet in a vase. Cut out flower shapes from coloured cards using a template. Use your imagination and let your inner child experiment. You can also make cut-outs in the shape of hearts, stars or tiny dolls. Use these beautiful shapes to make garlands, posters and banners.
4. Tri-colour balloons
Having a Republic Day party at your house or place of business? Make orange, white, and green helium balloons the focal point of your arrangement! Create a cheerful environment by arranging saffron, white and green balloons to turn your room into a visual symphony. Decorate corners, walls and ceilings with balloon clusters and garlands that symbolise the Indian tricolour. Use patriotic embellishments and accents reminiscent of flags to reinforce the theme.
5. LED lights
Decorate your space with tricolour LED string lights to capture the essence of the Indian flag and create a vibrant aura of saffron, white and green. Use these energy-efficient lights to accent windows, doors and other focal points to create a sense of patriotism. Add a touch of style with LED light patterns inspired by national emblems or the Ashoka Chakra. Let the LED lights flash brightly at sunset to represent India’s unity, diversity and vibrant spirit on this memorable day.
For a limited time, signup for the Capital One Venture X Business card and earn up to 300,000 bonus miles:
150,000 miles once you spend $20,000 in the first 3 months.
An additional 150,000 miles once you spend $100,000 in the first 6 months.
Card Details
Annual fee of $395
Card earns at the following rates:
10x miles on hotels and car rentals when booking through Capital One’s travel portal
5x miles on flights when booking through Capital One’s travel portal
2x miles on all other purchases
10,000 miles anniversary bonus
$300 annual travel credit for bookings through Capital One’s travel portal
Lounge access:
Priority pass lounge access
Capital one lounge access
$100 TSA PreCheck or Global Entry credit every 4 years
Existing Spark cardholders can apply for Spark Travel Elite, Spark Cash Plus cardholders cannot apply for Spark Travel Elite
Our Verdict
The lower tier can end up being a great deal, and it’s better than the prior offer of 150k points with $30k spend. I’m considering signing up and doing the $20k spend tier. However, in the past I haven’t had great luck getting approved with Capital One. Another option is a newly launched similar bonus on the Spark Cash Plus business card.
Remember, Capital One pulls all 3 credit bureaus. Unlike most Capital One business cards, Spark Cash cards do not report the statement balances to the personal bureaus; see these Things to Know About Capital One Credit Cards before applying. We’ll add this to our List of Best Credit Card Signup Bonuses.
Inside: Are you looking to maximize your rewards and credit card hacks? This guide will teach you the most effective methods for using your hacking, signing up for bonus rewards, and making efficient card purchases.
Credit card use extends beyond just making purchases. Savvy credit card users understand that with the right set of hacks and optimal usage, there’s a world of rewards that are ripe for the picking.
Money saved can be money earned, and this simple philosophy forms the cornerstone of these 25 credit card hacks you’ll be learning about today.
Why do credit card hacks matter? Well, I just received a $700 check for credit card rewards. That is enough to pay for a weekend trip away.
What are Credit Card Hacks?
Credit card hacks are creative strategies employed by credit card users to maximize the benefits and rewards offered by their credit cards while also potentially saving more money.
This trend has become more popular in recent years due to the rise in premium travel and cashback cards that offer lucrative ongoing rewards programs. Users who learn about these hacks can save you money on travel or just put cold hard cash back in your wallet.
With strategic approaches, these hacks provide an avenue to optimize rewards and navigate the financial landscape more effectively.
Proven Credit Card Hacks to Maximize Rewards
Tip #1 – Utilize sign-up bonuses
One of the most attractive features of credit cards is the sign-up bonuses they offer, which are essentially rewards that cardholders can earn after meeting a certain spending threshold within a specified timeframe. The bonuses can range from hundreds to even thousands of points, miles, or cash – favorably impacting your rewards balance.
To illustrate, if you take the Chase Sapphire Preferred® credit card, both partners in a household can get up to 50,000 extra points each as part of the sign-up bonus.
Bonus tip: Stagger your applications, so once one person gets the bonus after meeting the spending requirement, the other person can then apply and achieve the next round of bonuses.
Tip #2 – Increase credit limit
The principle behind this is simply buffering your “credit utilization ratio”, which is how much of your total available credit you are utilizing.
To illustrate how a credit limit increase will work, let’s consider an example: with a credit limit of $10,000 and a credit usage of $3,000, your utilization ratio stands at 30%. But once your credit limit increases to $15,000 with the same credit usage, your utilization ratio drops to 20% – which is a noticeable improvement.
Remember, when requesting a credit limit increase, some card issuers might execute a hard inquiry on your credit report, which could temporarily decrease your score. Hence, you should try to find out beforehand whether your issuer is likely to perform a hard or soft credit pull. Soft inquiries won’t affect your credit score, making them the preferable approach.
Tip #3 – Master balance transfers
A balance transfer, executed proficiently, can be an effective way to handle significant credit card debt. By focusing on reducing the cost of debt through lower interest rates, balance transfer can accelerate your debt repayment process while saving you considerable money over time.
This is what one of my clients did and the date when the 0% interest ended was very motivating to pay off their debt.
This process entails the shuffling of debt from one card (usually one with a high interest rate) to another card—preferably with a 0% promotional APR offer. With this interest-free period, you can focus on repaying the principal balance, hence clearing your debt faster.
As a finance expert, make sure balance transfers are only beneficial if you’re mindful of the terms, like how long your 0% rate will last and what fees are involved in the transfer to the new card.
Tip #4 – Purchase prepaid cards with credit
Need a way to spend a certain dollar amount by a certain deadline? Then, look at purchasing prepaid cards with a credit card as a strategy to earn extra rewards points. This method entails buying prepaid cards or gift cards using your credit card, and later using these prepaid cards to cover those expenses you typically will use.
In other cases, customers have reported that their credit card companies have clawed back rewards points that were initially given for gift card purchases. Double check their terms and conditions, many issuers, including American Express, explicitly exclude such transactions from earning rewards. 1
Tip #5 – Harnessing the 15/3 Methodology
The 15/3 Methodology is a credit card hack that intends to optimize your credit utilization ratio—one of the significant factors that impact your credit score.
Here’s how it works: You pay off a majority of your card’s balance 15 days before your statement date, and then pay off the remaining balance three days before the statement date. By doing this, you create the illusion of a lower balance, which can positively impact your credit score.
There is still a debate about whether or not this strategy improves your credit card score. Paying your bill on time will definitely improve your score.
Tip #6 – Strategies to earn additional rewards through third-party programs
An often overlooked but highly effective credit card hack is utilizing third-party apps and websites that offer additional rewards when you shop at participating retailers and restaurants. These rewards are additional to the cash back, miles, or points awarded by your credit card.
One such app is Dosh, a cashback app. By linking your credit card to your Dosh account, you can earn up to 10% cash back from participating retailers on top of the rewards earned from your credit card. Similarly, apps like Drop and Bumped give users points for every dollar spent, and these points can be redeemed for gift cards.
Furthermore, many airlines and hotels participate in dining rewards programs where you’ll earn extra rewards at select restaurants. Airlines like United, Southwest, Delta, and hospitality giant companies like Marriott and Hilton actively participate in such programs.
Tip #7 – Earn a credit card sign-up bonus then canceling the card right away
Also known as credit card flipping or churning, the tactic of earning a credit card sign-up bonus and then canceling the card right away has been employed by some savvy credit card users to maximize rewards.
However, this practice isn’t as easy or beneficial as it appears. While it sounds like an accessible system to generate easy money, it comes with several potential pitfalls that could make it a risky move.
Firstly, numerous card issuers have, over the years, implemented stricter rules to deter this practice. Chase, for instance, has the 5/24 rule indicating you can have only five new credit cards within the last 24 months. 2
Repeatedly opening and closing the same card can result in a declined application or rescinded bonus and hurt your credit score-perceived as credit misbehavior by the issuer.
It can also be viewed as unethical and potentially lead to you being barred from opening accounts with that issuer in the future.
Churning can negatively affect your ability to get approved for future credit cards and loans because lenders may think you’re a risky borrower.”
Tip #8 – Develop a multi-card system
This method aims to cover all your spending by using different cards that offer elevated rewards for certain purchase categories.
For instance, we have one card that pays an unlimited flat rate of 2% on all purchases. Then, another rewards card offering increased category rewards, with travel and gas. Then a there card that rotates through various categories each quarter.
Diversifying your spending amongst several credit cards can help you to earn the maximum possible rewards. However, endowing yourself with several credit cards is not for everyone as it requires careful financial management. In some cases, the potential of overspending can outweigh the benefits.
Tip #9 – Transfer points between multiple cards
Transferring points between cards (provided they are from the same issuer) is another useful strategy whereby you can redeem them at their maximum possible value.
The goal is to make your spending work for you and maximize the rewards you can earn from daily expenses. However, people should employ this strategy responsibly and ensure they’re not overspending just to earn rewards.
In such a strategy, points on traditional cashback cards can be transferred to airline and hotel partners when you also have a transferable points card like the Sapphire Reserve or Sapphire Preferred. So, not only are you earning cashback on your purchases, but you’re also accumulating lucrative points that can be redeemed for travel.
Tip #10 – Don’t use cash
In the world of credit card rewards, cash is no longer king. Whenever feasible, you should consider using your credit cards instead of cash or debit to pay for everyday purchases. This allows you to earn rewards on purchases you’re making anyway.
The best way to implement this is for you to bills with their credit cards instead of cash or debit and set this up on autopay. This serves a dual purpose of potentially earning rewards on these payments whilst also conveying a positive message to the banks about your money management skills, leading to possible credit score improvements.
However, this method works best when your spending doesn’t increase as a result. Only use your credit card for expenses that you’d normally pay in cash and for which you already have the money set aside to pay.
Tip #11: Time your purchasing
Being strategic about when you make your credit card purchases can help you wring out some extra benefits.
One way to optimize your earning potential and maintain a healthy credit score is to plan your large purchases around your credit card’s billing cycle. Making your most significant purchases immediately after your statement date ensures that you have the longest possible repayment period, effectively offering you a short-term, interest-free loan.
Furthermore, if your issuer has a rewards cut-off at the end of a calendar year, you can make larger purchases ahead of time to push yourself into a higher rewards bracket.
Tip #12 – Make Micropayments
Rather than making one full payment, consider making multiple payments over the billing cycle, commonly referred to as ‘micropayments.’ This helps keep your running balance low and, in turn, your credit utilization ratio – the percentage of your available credit limit you’re using – also low, positively impacting your credit score.
Plus it helps to keep your checking account at a more accurate level.
Tip #13: Have your spouse apply for the same credit card
Known informally as the “two-player mode” amongst credit card hacking enthusiasts, having your spouse or partner apply for the same credit card can be an effective strategy to earn double the sign-up bonus. This approach is based on the idea that instead of just adding your spouse or partner as an authorized user to your card, they should apply separately.
For instance, if a card like the Chase Sapphire Preferred® offers a 50,000 points bonus on sign-up, both partners can potentially earn up to 100,000 points collectively, essentially doubling the bonus.
But remember, this hack should be used strategically – you should stagger your card applications and ensure each of you fulfills the spending criteria to qualify for the bonus.
Tip #14 – Importance of prompt payment
Quite possibly the hack with the most significant impact on both your credit score and your pocket, prompt payment of your credit card bill cannot be overstated.
Making on-time payments can drastically improve your credit score since your payment history is the most heavily-weighted factor that credit scoring models consider.
Plus paying your balance in full each month can help you avoid interest charges and penalties, effectively saving you money in the long run.
Tip #15 – Know What Rewards you Want
Rewards such as travel miles, discounts at partnered retailers, cashback, or access to premium experiences like airport lounges or concert tickets are available, depending on your card.
By understanding and leveraging these varied rewards, you can get the most excellent value out of your credit card expenses.
Cautionary Advice on Credit Card Hacks
While credit card hacks can undoubtedly offer substantial benefits when done right, pitfalls can ensue if one isn’t careful.
Pitfall #1 – Overspending
For starters, these hacks can inadvertently lead to overspending or unnecessary purchases. Be wary of making purchases you don’t need or can’t afford in an attempt to earn more rewards or meet the spend necessary for a sign-up bonus.
Consequently, the pursuit of credit card rewards could also lead to accumulated debt if you’re not diligent about paying off your balance in full each month. The interest that you need to pay on balances carried over can easily eat up the value of any rewards earned.
Pitfall #2 – Impact on your Credit Score
Applying for multiple cards can lead to hard inquiries on your credit report, which can temporarily lower your credit score. Similarly, canceling cards after acquiring the sign-up bonus could harm your credit utilization ratio and your length of credit history, both key factors in your credit score calculation.
Additionally, irresponsible habits like ‘credit card churning’ and ‘paying for everything with credit’ may risk your relationship with card issuers. Some companies might close accounts or even ban individuals from opening new ones if they’re perceived as abusing the system.
While some of the top-tier reward and travel credit cards often come with hefty annual fees, not all of them are worth paying. This is especially true when a card’s annual fees outstrip the value of the rewards earned.
Before you sign up for a credit card with an annual fee, it’s advised to read the fine print and estimate what you can earn from it. You should evaluate whether the perks, bonuses, rewards, and credits offered offset the annual fee cost.
Personally, I don’t use any cards that have an annual fee.
Pitfall #4 – Paying interest
Credit card interest can significantly impact your overall financial health if you’re not careful. The money invested toward paying it off could be better used elsewhere – for saving, investing, or spending on your needs and desires. Hence, one of the best “credit card hacks” out there is to simply stop paying interest.
You want to focus on debt free living.
Pitfall #5 – Avoiding counterproductive habits like “balance surfing”
Balance surfing is a strategy where you continually move credit card debt from one card with an ending 0% APR promotion to another card with a new 0% APR offer. While this approach can potentially delay interest payments, it can become a dangerous cycle if you find yourself simply transferring debt instead of reducing it.
Meanwhile, the total debt remains the same. Without a consistent debt repayment strategy, this method can lead to an endless cycle of balance surfing.
What are some of the best credit card rewards and hacks for 2024?
As we venture into the new year, some credit card reward strategies remain timeless while others evolve in response to new credit card offers and updated reward programs. In 2024, here are some of the best credit card hacks worth considering:
Take Advantage of Updated Card Offers: Credit card issuers frequently update their card offers and rewards programs. Ensure you stay updated on these changes to maximize your card benefits.
Focus on Cards with Flexible Reward Categories: Some cards, like the Bank of America® Customized Cash Rewards credit card, allow you to choose your highest cash-back category (like online shopping, dining, or grocery stores). These flexible category cards can be more advantageous as you can adapt them to your spending habits.
Leverage Rotating Categories: Cards like the Chase Freedom Flex℠ and Discover it® Cash Back offer 5% cash back on up to $1,500 in purchases in various categories that rotate each quarter, once you activate. Plan your spending in advance to leverage these rotating categories optimally.
Remain Alert on Loyalty Program Partnerships: Many credit cards and airlines have partnerships with other brands. This can mean increased rewards when shopping with those brands, so always watch for new partnerships or promotions.
Revisiting Annual Fees: If your credit card perks no longer justify its annual fee due to changes in lifestyle or spending habits, consider downgrading to a no-fee card from the same issuer. This way, you can save on annual fees without closing your account which could potentially harm your credit score.
Diversify Your Rewards: While it may be tempting to concentrate all your spending on a single card, diversifying your rewards can make you earn more. Consider employing a multi-card system to maximize rewards across different spending categories.
Your credit card should be a tool to enhance your financial flexibility, not a burden that leads to financial stress.
Frequently Asked Questions (FAQs)
Deciding whether to focus on paying off a single card or distributing payments over several cards can seem complicated, but there are a couple of methodologies to strategize your payoff.
The Debt Avalanche method suggests focusing on the card with the highest interest rate first. Once you’ve paid this card off in its entirety, you then move on to the card with the next highest interest rate. This can potentially save you more money in the long term as it targets high-interest debt first.
Alternatively, the Debt Snowball method, proposed by financial guru Dave Ramsey, recommends paying off the card with the smallest balance first, then moving on to the card with the second-smallest balance. While you may not save as much money in interest compared to the debt avalanche method, the psychological motivation of paying off a credit card balance entirely may be more important for maintaining consistent repayment.
Either method requires you to make minimum payments promptly on all cards to avoid late fees and possible credit score damage.
Getting credit card points without spending any additional money may seem like wishful thinking, but there are certain strategies that you can employ to achieve this. Strategically managing your credit cards can turn your everyday spending into reward points, miles, or cash back.
Referral Bonuses: Many credit card companies offer referral bonuses to their existing cardholders who refer friends or family members. If the person you referred gets approved for the card, you can earn bonus points.
Cardholder Perks: Credit card companies often run promotions offering bonus points for certain activities. These can range from enrolling in paperless billing, adding authorized users to your account, or completing an online financial education course. Check with your card issuer to view any current promotions.
Shopping Portals: Many credit card issuers, and even airline and hotel rewards programs, have their own online shopping portals where you can earn additional bonus points for every dollar spent. If you were already planning on making an online purchase, consider making it through these portals to earn extra rewards.
Sign-up Bonuses: Some cards offer sizeable sign-up bonuses for new cardholders who meet a required minimum spend within the first few months. Although this technically requires spending money, it doesn’t require spending more money if you use your card for purchases you were already planning to make.
While implementing certain credit card strategies can potentially earn you higher rewards or save money, they can also unintentionally harm your credit score if not executed responsibly.
Several factors can contribute to this potential downfall:
Opening and Closing Accounts: A high frequency of card applications can lead to multiple hard inquiries on your credit report, which might lower your score in the short term. Closing credit cards, especially older ones, can affect both your credit utilization ratio and the age of your credit history, two significant factors in your credit score calculation.
Carrying a Balance: Maintaining a high credit utilization ratio—i.e., carrying a large balance relative to your credit limit—can negatively impact your credit score.
Late Payments: If these deadlines are not strictly adhered to, they could result in late payments, which can seriously harm your credit score.
Excessive Spending: Some tactics lead to unnecessary spending to earn more reward points or meet an initial spend required for a sign-up bonus. Not only can this increase your credit utilization ratio and potentially lower your credit score, it can lead to debt if these balances are not paid off in time.
While both rewards cards and travel rewards cards offer perks to their users in return for spending, the primary difference lies in the kind of rewards they offer and their target user base.
A Rewards Card generally offers cash back, points, or miles for every dollar spent, redeemable in a variety of ways. This is the type of card I prefer. For example, you may redeem your accumulated rewards as cash back into your account, use them to purchase products or services, or exchange them for gift cards. The flexibility of rewards makes these cards are suitable for people with varied spending habits and prefer a variety of redemption options.
A Travel Rewards Card, on the other hand, is designed specifically for frequent travelers. These cards earn you points or miles on specific travel-related expenses, like booking flights or hotel stays. The redeemed rewards are typically used towards further travel-related expenses like airfare, hotel stays, or car rentals. Travel Rewards Cards often offer additional travel-centric perks like free checked bags, priority boarding, airport lounge access, and more.
Consider your spending habits, lifestyle, travel frequency, and preference in terms of reward redemption.
Protecting yourself from credit card fraud is an important aspect of managing your credit card usage effectively.
Monitor Your Accounts Regularly: Keep a thorough watch on your credit card statements for any unauthorized or suspicious charges. Report them to your credit card issuer as soon as possible.
Use Secure Networks: When making online purchases, only shop on secure websites (look for “https” in the web address), and avoid using public Wi-Fi networks for transactions.
Keep Your Personal Information Safe: It’s important to dispose of old credit card statements properly, and avoid giving out credit card information over the phone unless you initiated the call and you trust the recipient.
Protect Your PIN and Password: Don’t share these with anyone, and avoid using easily guessable combinations like birth dates or the last four digits of your social security number.
Enable Account Alerts: Most banks now offer optional security alerts that can be sent via text message or email whenever a charge above a certain amount gets made to your account.
Protect Your Computer and Phone: Make sure your devices are equipped with up-to-date antivirus software and that your phone is locked with a secure password or fingerprint identification.
In case you become a victim of credit card fraud, know the steps to protect yourself – report it to your bank or credit card company immediately, file a report with the Federal Trade Commission, and report it to the three major credit bureaus, requesting them to put a fraud alert or a credit freeze on your account.
Also remember, credit cards don’t have routing numbers.
Making the Most of Credit Card Hacking
When used wisely, credit card hacks and reward strategies can play a significant role in stretching your budget and rewarding your spending. These secrets of savvy credit card use — from aligning your card to your spending habits, making the most of sign-up bonuses and reward categories, to understanding the ins and outs of your credit card’s rewards structure — can help maximize your potential rewards and save money.
Personally, we use all of our credit card rewards to pay for our travel expenses.
However, it’s paramount to remember that these tips and tactics should not encourage unnecessary spending or carrying a balance. Only spend within your means, ensure you pay off your balances each month to avoid interest charges and remember to safeguard your credit score by handling credit card applications and closures cautiously.
Ultimately, credit card hacks and rewards should fit within your overall financial plan and goals, adding value to your everyday spending habits and rewarding you for well-managed financial practices.
Remember your goal is to reach your FI number.
Source
Reddit. “American Express Clawing Back Points Earned From Gift Card Purchases.” https://www.reddit.com/r/AmexPlatinum/comments/14hywaq/american_express_clawing_back_points_earned_from/. Accessed January 19, 2024.
CNN. “What is the Chase 5/24 rule?” https://www.cnn.com/cnn-underscored/money/chase-5-24-rule#:~:text=The%205%2F24%20rule%20is,your%20approval%20odds%20with%20Chase. Accessed January 19, 2024.
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Housing starts in December came in at a seasonally adjusted annual rate of 1.46 million, above consensus expectations of 1.43 million. Single-family housing starts (1.03 million) were 16% higher than a year ago, and permits for single-family homes reached their highest level since May 2022. Homebuilders are expressing greater optimism for two reasons: the anticipation … [Read more…]
Update 1/22/24: AmEx made the following comment to Dans Deals:
We are committed to making sure there is significant, well-rounded value on our Business Platinum Card. You are seeing this expiration date because we are uncertain if these statement credit benefits with these merchant partners will be available after this date, as we continually evaluate our offerings. If or when any of these benefits change, we will notify Card Members in advance.
Original post: Some American Express Business Platinum benefits are now showing an end date of 12/31/24. These benefits include: Dell, Adobe & Indeed. It’s unclear if these will be extended or replaced with another benefit.
Home Equity, Pre-Qual, Correspondent, Verification Tools; Training and Webinars; STRATMOR on LO Habits
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Home Equity, Pre-Qual, Correspondent, Verification Tools; Training and Webinars; STRATMOR on LO Habits
By: Rob Chrisman
7 Hours, 30 Min ago
Attention in the hallways in the early going at the IMB Conference in New Orleans is varied. LinkedIn traffic seems to have picked up for IMB companies like Draper and Kramer and Atlantic Bay, but that is hardly a scientific measure of companies being bought, buying, or exiting the business. (As always, direct questions to company representatives.) Credit costs and trigger leads are a big item; this Wednesday’s L1 Mortgage Matters session at 2PM ET features John Fleming, of John Fleming Law and the Texas MBA, discussing issues including a fine update on the trigger lead situation. Being pragmatic about handling branches that are losing money, even if the crew there has been with you for years and years, is a hot topic among owners. The last 18 months has not been the time to waffle or ignore information. Today’s podcast can be found here and this week’s is brought to you LoanCare. LoanCare has successfully navigated clients and homeowners through market change for 40 years. The mortgage subservicer is known for delivering superior customer experience through personalization and convenience via its portfolio management tool, LoanCare Analytics™, supporting MSR investors with a focus on customer engagement, liquidity, and credit risk.
Lender and Broker Services, Products, and Software
Jonathan Spinetto COO & Co-founder at Nyfty Door, grew business from 0 loan originations two years ago when he signed with TRUV, and is projected to hit 3,000 loans a month in 2024. NYFTY door sees conversion rates over 60% with Truv and is saving 60-80% over competitors. Contact TRUV today for your income, employment, insurance, and asset verifications.
“Citi Correspondent Lending continues to foster targeted growth of our approved lender base with a focus on the expansion of our Community Lending platform. To start off the new year, we’re moving forward with full implementation of our proprietary affordable lending program, HomeRun, which features no MI, up to 97 percent LTV and as little as 1 percent borrower down payment contribution. To further compliment this rollout, our CRA pricing incentives were recently updated with enhancements to several markets, including Miami, Newark, San Jose, and Los Angeles. Learn more about HomeRun and all of the other growth opportunities Citi Correspondent Lending has to offer by contacting our National Client Services Team or completing our Prospective Correspondent Questionnaire.”
Get ready to rev your engines and network like a champion at the 3rd annual Supercar Experience, brought to you by Lender Toolkit, Reggora, Lenders One, and LodeStar! Mark your calendars for March 18th, before the kickoff of EXP24 in Vegas. We’ll take over Speed Vegas Exotics Racing, where you can unleash your inner speed demon behind the wheel of a dream supercar and connect with industry decision makers in a high-octane setting. Build valuable partnerships and expand your circle with leading mortgage minds at this one-of-a-kind event. Gain exclusive insights from and ask your questions of industry expert Rob Chrisman in a live Chrisman Commentary podcast. Plus, shake hands with Talladega Nights’ icon, Ricky Bobby himself! Experience more than just supercar thrills with an exclusive reception, delicious catering, and racetrack excitement. Don’t miss out on this unforgettable opportunity to elevate your brand, fuel your EXP24 prep, and network like a boss. Secure your spot now. Shake and bake!
One of the more annoying jobs of a loan officer is putting together closing cost summaries every time a borrower looks at a new house. What if they could fire them off from their phone (accurately) without having to go into the LOS each time? All your pre-approved buyers, on your phone, integrated with the LOS. Turn your loan officers into super-awesome fireball-throwing loan officers with QuickQual by LenderLogix.
Introducing The 2024 Lender Playbook: 4 Tips to Drive Profitability in a Recovering Market. How will the coming election, housing inventory, and Fed action impact the mortgage market (and your lending success) this year? There’s a lot going on in 2024, and market recovery won’t be straightforward. The good news? You can still build a strong, forward-thinking plan for resilience and profitability. Tenured industry experts from Maxwell’s senior team helped create this guide to teach you how to reduce costs, win borrower business, and capture intermittent loan volume as it reemerges in the market. To get a leg up on the competition and build agility into your business, click here to download The 2024 Lender Playbook: 4 Tips to Drive Profitability in a Recovering Market.
Join FirstClose, Curinos and Fifth Third Bank on Thursday, February 15 for a deep dive into today’s home equity market. Take a look behind the scenes at the products and processes that fuel home equity lending, new financing options that are creating opportunities for both depository and non-bank participants and, most importantly, learn how to capitalize on this market. This one-hour online event is a must attend for anyone currently in the home equity space or thinking of entering. Register today.
STRATMOR on LO Habits
Do you ever feel like you’re living the same day over and over again? Sometimes it takes watching a 90’s comedy classic to bring us to our senses and remind us that we must keep trying new things, changing, and evolving if want to see new and different results. In his latest Customer Experience Tip, STRATMOR Customer Experience Director Mike Seminari shares some lessons Bill Murray’s character learns in the movie “Groundhog Day” and how LOs can apply it to their process in 2024. Check out “Fresh Ideas for LOs Looking for Better Results in 2024” for recommendations on how to incorporate small change habits into your daily routine to help drive more referrals and repeat business in 2024.
Webinars, Events, and Training to Wrap up January
The upcoming webinar, “California Lien Law Overview for Construction Lenders” will be hosted by Land Gorilla on Wednesday, January 24 at 10AM PT/1PM ET. In continuation of the informative construction lien law webinars covering Florida and Texas, this webinar promises more great insights and understanding into California’s specific statutory requirements. Discover faster and more cost-effective alternatives to a foundation survey. Gain insights into California’s Prompt Payment Act. Learn the significance of the Notice of Completion in California and its critical timeline that can minimize a lender’s exposure during the final disbursement. You won’t want to miss these key insights to help you effectively manage construction loans. Register now to secure your spot. All registrants will receive the webinar recording.
A good place for longer term conference planning is to start is here, and click on “events” for conferences in the future. Of course this week we have the MBA’s IMB Conference in New Orleans.
What’s ahead for commercial real estate (CRE) markets in 2024? Join SitusAMC’s inaugural “ValTrends First Look” webinar on January 23, at 2pm ET, hosted by Senior Director of SitusAMC Insights Peter Muoio, PhD and Vice President of SitusAMC Insights Jennifer Rasmussen, PhD. Instead of looking back at the previous quarter, the new ValTrends webinar will leverage recent survey data of leading institutional and regional CRE executives to give you a forward-looking snapshot of the quarter ahead.
National MI: Highlights from the Profile of Home Buyers and Sellers with Rebecca Lorenz – January 23rd at 2PM ET. Build a Prospecting Follow-Up Strategy with Kendra Lee – January 25th at 1PM ET.
Sign up for a complimentary webinar hosted by ICE to hear about AI and the future of home valuations. A panel of industry experts will discuss the ways AI-powered tools eliminate valuation bias. They’ll also cover how AI accelerates the valuation process, and ways you can look out for fraud when using AI in home appraisals. The webinar, Artificial Intelligence and the Future of Home Valuations, will be held on Tuesday, Jan. 23 from 2 -3 p.m. Don’t miss out on key insights: register here.
Join BankingBridge, Wednesday, January 24th, 2PM ET/11AM PT, for an insightful webinar delving into the opportunities Zillow offers to enhance lead generation and conversion for mortgage lenders. This comprehensive session is designed to guide you through the various advertising avenues available on Zillow, including the strategic use of the Zillow Mortgage Rate Table, and the nuances of both long-form and short-form leads.
Wednesday the 24th, looking for more in-depth commentary on weekly mortgage news? Register here for “Mortgage Matters: The Weekly Roundup” presented by Lenders One. Every Wednesday at 2PM EST/11AM PT is a dive into a range of mortgage-related topics, including market trends, interest rate fluctuations, innovative mortgage products, and industry advancements. Listen to a unique mix of age perspective, expertise, and charisma to the screen, ensuring that the information is not only educational but also entertaining. Hear from This week is fabled Austin-based attorney John Fleming discussing trigger leads and the NAR verdict.
“Mastering the Art of Mortgage Broker Engagement” is on January 24th at 10AM PST to learn best practices and strategies that wholesale lenders are using to thrive in the TPO market. This webinar will show you proven tactics and technology tools that are helping wholesale lenders create efficient sales processes that are both scalable and effective. Click here to register.
Join Real Estate Consulting (RCLCO) for this Month’s Webinar: New Year, New Trends – Compensation & Talent Management, Thursday, January 25th, 9:15AM PT / 12:15PM ET. Speakers include Ellen Klasson, Managing Director; Eric Willett, Managing Director; Adam Ostler, Principal, and Moderator Joshua A. Boren, Managing Director, Strategic Initiatives (Moderator).
Friday, January 26th, is this week’s episode of The Mortgage Collaborative’s Rundown covering current events in the mortgage market for 30-45 minutes starting at noon PT, 3PM ET, in “The Rundown”.
The California Association of Mortgage Professionals (CAMP) is presenting the 2024 Economic Forecast with Dr. Michael Frantanoni and Rob Chrisman on Tuesday, January 30th
1PM PT. “Unlock the Future: 2024 Economic Forecast Revealed! Dive into a World of Opportunities and Growth. Discover Key Insights, Trends, and Strategies for Success in the Upcoming Economic Landscape.”
“Lending operations leaders who care about increasing revenue and decreasing costs, join your tribe in this live event. On January 30th at 1pm CT is an electric panelist lineup made up of Industry leaders that are going to ‘spill the beans’ on ten strategies they are focused on to increase sales and reduce costs with minimal investment in 2024. Join Kevin Peraino, Chief Lending Officer at PRMG, Delfino Aguilar, Chief Production Officer – TPO, Kind Lending, David Lykken, Founder & Chief Transformation Officer at Transformational Mortgage Solutions, LLC (TMS), and Richard Grieser, VP of Marketing at TRUV.
Now available on the Federal Housing Administration’s (FHA) Single Family Housing Events and Training web page under Single Family Housing Self-Paced, Pre-Recorded Training
The first self-paced training module, the Single-Family Housing Policy Handbook (Handbook 4000.1) is an evergreen presentation that walks new and/or existing stakeholders needing a refresher through Handbook 4000.1’s structure and style. It is designed to help viewers understand its benefits, where to access it online, how to read Mortgagee Letters (ML) in context, and how to locate content updates.
The second self-paced training module, the Home Equity Conversion Mortgages (HECM) Origination and Servicing Overview, focuses solely on the newest and final Handbook 4000.1 section that was released on October 31, 2023, and announced in a press release and FHA INFO 2023-84. It begins with a review of the new HECM section’s style and structure, consistent with the rest of Handbook 4000.1 for HECM originators, servicers, and other interested parties. Additionally, it provides viewers with an overview of some of the more recent HECM policy updates that have been incorporated into this new Handbook section, making it easier for HECM originators and servicers to locate the information needed to do with business with FHA in one place.
Capital Markets
Another week, another round of good U.S. economic news. Last week’s Michigan sentiment for January crushed expectations to register at the highest point since July 2021, strong retail sales data from December, and the lowest level of initial jobless claims in over a year. Positive economic news, coupled with diminished chances of a March rate cut, have pushed bond yields to the highest levels in a month. Americans are feeling positive about the economy, their incomes, and the outlook on prices. Notably, the increase in consumer sentiment was accompanied by another drop in year-ahead inflation expectations, which have returned to a level not seen in three years.
The preliminary reading of the University of Michigan’s Consumer Sentiment Index for January was well ahead of estimates, hitting its highest level since July 2021 with year-ahead inflation expectations decelerating to 2.9 percent from 3.1 percent, a rate not seen in just over three years. Existing home sales decreased 1.0 percent month-over-month in December to a seasonally adjusted annual rate of 3.78 million from 3.82 million in November. Sales were down 6.2 percent from the same period a year ago as high mortgage rates continue weighing on the overall level of activity, though they have not stopped prices from continuing to climb.
Last week’s batch of data, which included a mix of high consumer confidence and lower inflation expectations that points toward a soft landing for the U.S. economy and Fed Chair Powell’s war on inflation, has dropped the implied likelihood of a 25-basis points rate cut at the March FOMC meeting to 45 percent currently from over 55 percent seen at the beginning of last week. While investors continue to chip away at bets that the Fed will cut rates early and aggressively this year, there remains a significant gap in the market and Fed expectations for the fed funds trajectory this year.
It all points to a solid American economy, notably more so despite a Fed rate-tightening campaign that seemingly has broken the back of inflation. However, investors are eager to know when those rate hikes will be reversed; expect them to wait to ease, and that the market will merge with what the Fed thinks. The Fed will err on the side of being conservative.
Central banks will also be busy, with monetary policy statements and interest rate decisions expected from the Bank of Japan, European Central Bank, and Bank of Canada. In the U.S., Federal Reserve members will be in a blackout period of no public talks ahead of the next FOMC meeting on January 30-31.
This week’s economic calendar includes month-end auctions consisting of $162 billion 2-year, 5-year, and 7-year notes tomorrow through Thursday with $18 billion 2-year FRNs also on Wednesday, Fed surveys, S&P Global PMI flashes, durables goods orders, the first look at Q1 GDP (expected at 2.0 percent), new home sales, and Fed favorite PCE on Friday. Expectations are for the core PCE Price Index to increase 0.2 percent month-over-month and 3.0 percent year-over-year versus 0.1 percent and 3.2 percent previously. No Fed speakers are scheduled with the Fed in their blackout period.
Additionally, this week brings the ECB’s first monetary policy meeting of 2024 and a rate decision from the Bank of Japan. Today’s economic calendar sees just one data point with leading indicators for December. (The forecast is for unchanged which, if realized, would be the first non-negative reading in 21 months.) We begin the week with Agency MBS prices better by .125-.250, the 10-year yielding 4.09 after closing last week at 4.15 percent., and the 2-year at 4.38.
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Macro Trends Advisors founding partner Mitch Roschelle joins ‘Varney & Co.’ to discuss the housing market under the Biden administration as monthly mortgage payments continue to soar.
New U.S. home construction fell in December for the first time in four months, despite a sharp drop in mortgage rates.
Housing starts decreased 4.3% last month to an annual rate of 1.46 million units, according to new Commerce Department data released Thursday. Refinitiv economists had projected a pace of 1.42 million units. The decline stemmed from a substantial drop in single-family home construction, which fell by the most since July 2022.
However, applications to build – which measures future construction – rose in December, increasing 1.9% over the course of the month to an annualized rate of 1.49 million units. When compared with the same time last year, building permits are up about 6.1%.
“Building permits, a leading indicator of future construction, accelerated in December as builders expect the housing market to improve as borrowing costs fall,” said Jeffrey Roach, chief economist at LPL Financial.
HOME FORECLOSURES ARE ON THE UPSWING NATIONWIDE
Homes are under construction in Sacramento, California, on July 3, 2023. (David Paul Morris/Bloomberg via / Getty Images)
The data comes one day after the National Association of Home Builders/Wells Fargo Housing Market Index, which measures the pulse of the single-family housing market, rose five points to 44. The increase followed a three-point increase in December.
Any reading below 50 is considered negative.
MORTGAGE CALCULATOR: SEE HOW MUCH HIGHER RATES COULD COST YOU
“Lower interest rates improved housing affordability conditions this past month, bringing some buyers back into the market after being sidelined in the fall by higher borrowing costs,” said Alicia Huey, NAHB chair and a custom home builder and developer from Birmingham, Alabama.
A sign outside a home for sale in Atlanta on Sept. 6, 2023. (Elijah Nouvelage/Bloomberg via / Getty Images)
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Sentiment among builders began steadily falling at the end of the summer after mortgage rates shot above 7%, throttling demand among would-be homebuyers. But borrowing costs have retreated over the past two months as many investors believe the Federal Reserve is done with its aggressive interest-rate hike campaign – and will soon pivot to cutting rates.
Rates on the popular 30-year fixed mortgage are currently hovering around 6.66%, according to Freddie Mac, down from a high of 7.79% at the end of October but well above the pre-pandemic average of 3.9%.
The recent decline has prompted a burst of optimism among homebuilders that the worst may be over. However, the housing market is facing new headwinds heading into 2024, including higher prices and shortages of labor and lumber.