Credit Sesame’s personal finance news roundup April 26, 2025. Stories, news, politics, and events impacting personal finance during the past week.
Corporate profits surge since COVID
A study by the Federal Reserve Bank of St. Louis shows that U.S. companies have made significant gains in the years since the pandemic began. This represents more than just a rebound from the initial economic slump. In dollar terms, corporate profits have more than doubled since 2010, with most of the growth occurring after 2019. Profits have outpaced overall economic growth, rising from an average of 13.9% of national income from 2010 to early 2020, to 16.2% since 2020. See summary at StLouisFed.org.
Debt collectors set to resume student loan pursuits in May 2025
The Department of Education announced it will begin referring delinquent student loan borrowers to debt collectors starting May 5. The department had already resumed reporting delinquent payments to credit bureaus, but referring the account to a collector is another major negative for credit scores. About 5 million of 42 million borrowers are currently in default. Borrowers may face consequences, such as wage garnishment, unless they resume payments or arrange a repayment plan with their servicer. See article at NYTimes.com.
Sharp drop in existing home sales in March 2025
Sales of existing homes fell by 5.9% in March, with homes selling at a seasonally adjusted annual rate of 4.02 million. The sales volume is 2.4% lower than it was a year ago. Despite the slowdown, home prices have risen year-over-year for 21 straight months, reaching an average of $403,700. Rising inventory could pressure prices, with unsold home supply increasing by 8.1% last month. The West had the steepest decline in sales, down 9.4%, while the Northeast saw a milder 2.0% drop. See home sales data at NAR.Realtor.
Mortgage rates dip slightly after sharp rise
After jumping 21 basis points the previous week, 30-year mortgage rates edged down by two basis points to 6.81%. Meanwhile, 15-year mortgage rates fell nine basis points to 5.94%, slipping back under 6%. Current 30-year rates are 4 basis points lower than at the start of 2025 but remain 73 basis points higher than their low point in September 2024. See rate data at FreddieMac.com.
Study shows shifting middle-class income ranges
A new Bank of America study reveals that the income thresholds for the middle class vary widely by household type. Overall, a household needs about $80,000 to reach the median. However, single-income households typically earn $60,000, while multiple-income households average $136,000 per year. Nearly 40% of middle-income households are headed by people aged 25 to 44. See article at Yahoo.com.
Loan delinquencies ease but remain elevated
TransUnion’s latest Credit Industry Snapshot shows that delinquency rates for auto loans, credit cards, mortgages, and personal loans declined slightly in March 2025. Even subprime loans showed improvement. However, delinquency rates are still up compared to a year ago, with auto loan delinquencies rising 4.6% and mortgage delinquencies up 19.2%. Mortgages and auto loans, backed by collateral, remain among the safer loan types despite recent trends. See details at TransUnion.com.
Home-buying confidence plunges
Survey data from the Federal Reserve Bank of St. Louis shows that confidence in buying a home has fallen sharply since last November. The Home Purchase Sentiment Index, which tracks views on home prices, mortgage rates, and personal finances, dropped 9.2% since November, including a 4.9% decline in March alone. The index now sits 11.3% below its historical average. See index data at StLouisFed.org.
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