My Credit Plan Blog

Media Highlights the Tools of Mortgage 850

Sat, 18 Apr 2026 01:28:42 GMT

The State of Utah has funded Mortgage 850 to help more Utah homebuyers improve their home purchasing power. Christine Flores with KUTV (CBS) in Salt Lake City reports about a young couple who utilized Mortgage 850 which has given them a roadmap to homeownership.

Clink on this link to the story:

https://kutv.com/news/eye-on-your-money/utah-funds-free-program-to-help-homebuyers-improve-credit-scores-get-better-interest-rate

The Pippins increased their home purchasing power by almost $100,000 David said. This program is unique to the tools to help prospective homebuyers find ways to purchase a home.

Deon Spilker who just retired from Utah Housing Corp, stated “I think we are scaring individuals away from even looking into housing,” Spilker said. “What they need is a roadmap — how to start, what to do.”

There will be more stories coming out about the success stories of Mortgage 850.

Stay tuned

Almost 70% of Homebuyers End Up with a Higher Interest Rate

Sat, 11 Apr 2026 00:25:00 GMT

Most homebuyers are ending up with a higher interest rate than what is the lowest interest rate. A recent review of over 1,600 mortgages in 2025 discovered that 68% of those mortgages had a higher than the lowest interest rate offered at that time.

Why?

There are several factors. Mortgage lenders have to pay extra costs to investors when a loan is sold weeks after closing. For the more popular conventional loans, these hidden costs to homebuyers are based up to nine factors:

Credit Score – 620 to 780

Down Payment – Percentage down

Type of Home – Single Family, townhome, condo or manufactured home

Purpose of Loan – Purchase, refinance or cash out refinance

Number of Units – 1, 2, 3, or 4

Fixed or Variable Interest Rate

Loan Balance

A Second Mortgage – yes or no

Occupancy – Live in it, 2nd home or investment

Lenders have to pay extra hidden fees based on your answers to these questions. For government loans such as FHA, ,VA, and USDA, these fees are based on credit score, type of home, number of units and loan balance. The higher the fees, the higher the interest rate will be. If a lender has to pay 1.00% in a hidden fee for a 730 credit score and 10% down on a 30-year fixed conventional mortgage, the corresponding fee is $4,000 on a $400,000 loan. To offset this cost, the lender will have to increase the interest rate. If the best interest rate is 6.00, the lender will adjust the interest rate higher to say 6.50% to cover that $4,000 cost.

Unfortunately, sdhopping lenders trying to find the lowest interest rate will not help reduce tis fee and lower the interest rate for a homebuyer. All lenders have to pay the same fees. So every lender will be offering 6.50% - maybe 6.375%. But no lender will absorb that entire $4,000 cost and offer a 6.00% interest rate.

Do lenders have to disclose these fees? No. These fees do not show up on any Closing Statement or Loan Estimate. They are hidden in most cases. This is why homebuyers are paying higher interest rates. They have no way of knowing. And loan officers are not going to tell you about these fees because they will tell you, "Motgages are complex."

What can you do? Mortgage 850 by My Credit Plan discloses these hidden fees and how they impact interest rates across dozens of possibilities. Knowing how these fees impact interest rates, payments and purchasing power can help all homebuyers secure lower interest rates and payments and increasing home purchasing power.

A homebuyer can increase their home purchasing power by up to 26% without increasing a payment. It is a program worth your investment becuse you can easily save thousands of dollars in most cases.

A Game Changer for All Homebuyers

Thu, 02 Apr 2026 02:09:25 GMT

This Program is Called, “A Game Changer for All Homebuyers”

The State of Utah has just funded a cutting-edge technology for future Utah homebuyers called “Mortgage 850 by My Credit Plan.”

What does Mortgage 850 offer that is not found with lenders or any resource? A lot!

Mortgage 850 offers three critical tools (not found anywhere else) to purchase a home:

The leading FICO® Score Improvement program averaging 64 points higher since 2020.

It shows in real time how changes to a credit score can lower a home buyer’s mortgage interest rate and payment, and improve his / her home purchasing power.

When a person does not qualify for a mortgage, it offers a road map to qualifying. Mortgage 850 shows multiple ways for each home buyer to potentially qualify for a mortgage through higher credit scores, more income or down payment, a reduction in monthly payments, or a combination of factors.

There are many options for home buyers.

In trials, home buyers love Mortgage 850 because it takes the guessing out of qualifying for a mortgage and does not negatively impact credit scores. It fills in more answers to questions – both asked and those not asked – in seconds instead of hours and days. It also helps identify mistakes made by loan officers that can save thousands for home buyers.

It has taken three years to build Mortgage 850. It is a new day to purchase a home.

Mortgage 850 by My Credit Plan is a non-profit / for-profit partnership between Family Financial Education Foundation and Momentum Loans.

When will Interest Rates Decline?

Fri, 27 Oct 2023 23:18:34 GMT

Over the last 18 months, interest rates have taken a hard hike higher evaporating the dreams of many. The question is asked, when will interest rates decline? There are some indicators to give everyone some ideas.

Many consumers falsely believe that mortgage interest rates are tied to the Federal Reserve. They are not. The Federal Reserve has a direct impact in short term lending to banks, while long term interest rates are indirectly impacted from the Federal Reserve.

There are times that the Fed’s interest rates are low, and mortgage rates are much higher, like we saw in the first part of 2022. Other times, the Fed's interest rates are higher than the long term interest rates such as the beginning of the pandemic, when mortgage rates plunged below the Fed's rates for a period of time.

When will mortgage rates decline?

Obviously the Fed keeping short term rates high around 5.00% has an impact. However, the Fed also owns over $2 trillion in mortgages they purchased primarily during the pandemic that the Fed wants to sell.

This creates upward pressure on mortgage rates because there is an oversupply of mortgages being potentially sold on the market, and an insufficient number of buyers. What happens? Mortgage rates go higher in order to keep attracting more investors to purchase mortgages. Higher interest rates attracts more investors (buyers).

In addition, Congress and the Biden administration are running between $2 to $3 trillion dollars annually in the red. Where does that money come from? The U.S. Treasury issues government bonds to cover the shortfall. It is like a line of credit for the U.S. Treasury. Unfortunately for homebuyers, those U.S. bonds compete with mortgages for investors. In order to attract the investors, all interest rates go higher because of the excessive supply and lack of demand from investors. It is basic supply and demand.

There are wars now that the U.S. government is funding hundreds of billions more annually. That adds additional pressure because the U.S. Treasury does not have the money. It has to borrow for it. Which leads to higher interest rates for the foreseeable future.

How long could this last? Good question. Mortgage rates could stay relatively high for a year or two settling somewhat in the high 6.00’s to 7.00’s as the economy slows down – slightly lower than the current levels. Nevertheless, the fact that interest rates are high because of the amount of debt being issued, means many homebuyers dreams will either have to pay an additional “tax” in higher interest rates, or postpone that dream as it gets pushed farther away.

The one good news? There is some hope. Home prices are starting to decline and we should see some more settling for the foreseeable future.

The Rules are Changing for New Mortgages!

Fri, 20 Jan 2023 23:25:50 GMT

Everyone wants to get the lowest interest rate on a mortgage when they purchase or refinance a home. Many consumers think a minimum 720 credit score will qualify them for the lowest interest rate. More savvy consumers realize that that credit score requirement is 740. Now that number is being raised to 780 for the most popular mortgage loans. There are a few other new criteria in order to get the lowest interest rate. What does this mean for prospective home buyers and those looking to refinance their mortgage? Things are changing!

There are several new provisions for the conforming loan programs (Fannie Mae / Freddie Mac) that will start on May 1, 2023. They are as follows:

New Credit Score Requirements
Interest Rate Adjustments
Debt Ratio Adjustments

New Credit Score Requirements

There are two substantial changes here. First, the minimum credit score to get the lowest interest rate has been raised from 740 to 780.

In addition, any credit score below 640 will no longer qualify for a conforming mortgage. It has been anything below a 620 credit score.

Interest Rate Adjustments

Interest rates for the most part are going to be higher. Here are some comparisons in interest rate with a 5% down and a 30 year mortgage:

Old Outline New Outline

780 No Adjustment No Adjustment

740 No Adjustment 1/4 % Higher

700 3/8 % Higher 3/8 % Higher

Debt Ratio Adjustments

For the first time, interest rates will be adjusted when the debt-to-income ratio is above 40%. For example, a person making $10,000 a month is putting down 5% and has monthly debt payments of $4,500 making his monthly debt-to-income ratio payments 45%. In this case, the person will have an adjustment in interest rate of about 1/8%.

If the monthly debt payments will be $3,500, making the debt-to-income ratio at 35%. In this case, there will be no interest rate adjustments.

There are several other adjustments that will be highlighted in future blogs. Everyone needs to understand that the cost of taking out a mortgage is going up.

Dropping Critical FICO® Score Points While Shopping for Your House

Fri, 14 Oct 2022 21:52:24 GMT

Nate was looking to purchase his very first home sometime within the next six months. He contacted a realtor who told him to go to a lender to get pre-approved for a mortgage. This is a common practice, but there is a BIG PROBLEM and it is one that could easily cost you lots of money. For Nate, it cost him almost two thousand dollars because he went beyond the 90- days and he was at 719, costing him lots of money. It can easily happen to any homebuyer.

The first step most realtors and lenders tell you to do is get preapproved for a mortgage. Let’s walk through some rules about your credit scores when you get prequalified for a mortgage. There are several rules here, but I am going to walk it through for you.

You have 14 Days to shop a mortgage.
The impact from the first credit report is about 7 points.
Mortgage lenders grade FICO Scores by 20 point increments.
A hard (credit application) inquiry does not impact scores until the following month.
Hard inquiries impact your FICO Scores for 12 months
Your lender’s credit report / scores are good for 90 days.

You have 14 days to shop a mortgage

Inquiries from any lender while applying for credit will lower your lender’s FICO credit scores. For mortgages, you have 14 days to shop multiple lenders. This means you can contact two, five, and maybe ten lenders. As long as they pull your credit report within that 14 day period form the first to the last, it only counts as one hard inquiry. Go beyond that and every inquiry will lower credit scores even more.

The impact from the first credit report inquiry is about 7 points

A hard inquiry can lower your FICO credit scores up to seven points for each one. That means a FICO score can go from 730 to 723, or 700 to 693, or even 685 to 678 from one inquiry. That means after each mortgage prequalification, your FICO scores will drop about seven points. This is important to remember.

Mortgage lenders grade FICO Scores by 20 point increments.

Mortgage lenders grade your FICO scores by 20 points primarily starting at 620. These are the grades.

620 to 639

640 to 659

660 to 679

680 to 699

700 to 719

720 to 739

740 to 759

760 and Above

Each grade higher means savings to you. On a conventional 5% down $400,000 30 year mortgage with a credit score going from 679 to 680 – a one point improvement – would save the borrower $4,000. Just one point. So each grade achieved is important to realize more savings.

A hard (credit application) inquiry does not impact scores until the following month.

A hard inquiry will not impact your FICO credit scores until the following month. That means a credit report pulled on February 1 will not impact your FICO Scores until March 1. Then the impact from the inquiry on February 1 will appear on your FICO scores for every credit report pulled after March 1.

Hard inquiries impact your FICO Scores for 12 months

The impact to your FICO Scores from the February 1 hard inquiry will be felt until January 31 of the following year, or 12 months. That means every time your credit score is pulled during that period, your FICO Scores will drop up to seven points until February 1 of the following year.

Your lender’s credit report / scores are good for 90 days.

The FICO Scores pulled the first February 1 is good for 90 days before the mortgage lender needs to pull your credit report again. There are two important points to understand here.

First, if you are not ready to purchase a house immediately, it would be unwise to have your credit report pulled right away. The reason? Any credit report pulled after March 1 will have FICO scores that are impacted up to seven points from that February 1 inquiry. That could drop you a grade from say 705 to 698, or from 682 to 675. That means it will cost you a lot more money. In the above given example, the cost to the homebuyer would now be $4,000 more.

Second, if you are trying to improve your scores, it would be best to not have the mortgage lender pull your credit report. Work through a certified non-profit credit counselor such as MyCreditPlan.org until you are ready. The reason? They do not leave hard inquiries. Any credit reports requested through a non-profit credit counselor DO NOT IMPACT your FICO Credit Scores.

When you are ready, then go to a mortgage lender and as long as you close within 90 days, the mortgage inquiry does not impact your scores.

For this reason, it is best to utilize a non-lender service until you are ready to purchase your home. My advice is go to MyCreditPlan.org so you can save yourself a FICO Score drop when looking for a home.

Be Careful with Your Mortgage Application

Fri, 22 Jul 2022 23:58:27 GMT

When shopping for a home, your realtor will tell you to go get qualified. This could be a mistake, depending how long it takes you to find a house. Mortgage loan officers never discuss this with new borrowers. But, it is something that can come back and cost you a lot of money.

A mortgage lender will pull your credit report usually within a day or two after submitting your loan application. The mortgage inquiry will impact your credit scores the following month. The impact can be up to over a half of dozen points decline in your scores.

If it takes longer than 90 days to find a house and close on a mortgage, the mortgage lender will have to request your credit report again after 90 days, creating a new inquiry. The problem on the second credit report is your three FICO scores have already dropped from the first inquiry. This means you are taken a hit to your scores.

Such a credit score drop could cost the potential homebuyers a lower grade to their credit scores, meaning they see a higher interest rate, payment and / or costs. Credit scores are graded in 20 point increments. If credit scores drop from an “A’ grade (760 and above), to below 760, the mortgage applicant could see a higher payment. The credit score grade adjustment also occur at 740 to below 740, 720 to below 720, 700 to below 700, 680 to below 680, 660 to below 660, and 640 to below 640. If someone drops below 620, the chances of being approved are remote.

Inquiries hit younger consumers harder because they lack the depth to their credit report. Tony is just 20 years old and had a 701 credit score with a signed contract ready to purchase a home. A problem came up and he cancelled the contract. He waited over 75 days to find another house. The lender pulled an updated credit report and his score had dropped to 694. His interest rate and payment went up an extra $63 a month.

What to do?

Make sure you are intent on purchasing a house within 90 days before you have the mortgage lender pull your credit report. If are looking for longer than 90 days, utilize another source to check your Classic FICO Scores and loan qualifications such as a certified credit counselor. Non-profit credit counselors do not create hard inquiries on your credit report and you get the same loan and FICO Score information. MyCreditPlan.org is one non-profit credit counselor that is available online. For a small fee, you can check your 3 FICO credit scores used by all mortgage lenders, and it will provide your mortgage loan qualifications.

Just another way to try to save you money and any heartache.