Credit Sesame’s personal finance news roundup June 28, 2025. Stories, news, politics and events impacting personal finance during the past week.
FICO to factor BNPL into credit scores this fall
In recognition of the increased use of Buy Now Pay Later (BNPL) programs by American consumers, FICO is launching a version of its credit scores that takes into account BNPL activity. The new credit scores are expected to be available in the fall of 2025. For individuals who struggle to qualify for traditional credit, factoring in BNPL transactions could be a way of building a credit history. Inclusion of those transactions will depend on whether the BNPL lender reports activity to the credit bureaus. The credit history will record BNPL and may be positive or negative depending on whether consumers pay on time. However, not all credit scores will include BNPL transactions. See article at Yahoo.com.
Mixed credit results for consumers in May 2025
The latest TransUnion Credit Industry Snapshot revealed both positive and negative trends for consumers in May. Average balances owed increased for credit cards and mortgages, but decreased for unsecured personal loans. Rates of serious delinquencies on payments rose for auto and unsecured personal loans, but declined for credit cards and mortgages. However, the falling rates of seriously delinquent accounts for credit cards and mortgages might prove short-lived. Serious delinquency rates for these forms of credit refer to those that are 90 days or more overdue. While those rates dropped in May, shorter-term delinquency rates rose for both credit cards and mortgages. That means more consumers with those forms of debt have fallen behind recently. See details at TransUnion.com.
Consumer confidence drops sharply in June 2025
The Conference Board’s Consumer Confidence Index fell by 5.5% in June. This erased roughly half of the progress made in May, leaving the Index substantially down for the first half of 2025. The component of the Index that measures current business and labor market conditions fell by 4.7% during June. The Expectations Index, which measures the economic outlook consumers have for the near future, fell by nearly 6.3%. This left the Expectations Index well down into a range that has traditionally been associated with recessions. Tariffs and inflation continue to be issues that weigh most heavily on people’s minds. See news release at Conference-Board.org.
Existing home sales sluggish in May 2025
The National Association of Realtors reported that sales of existing homes rose at a seasonally-adjusted pace of just 0.8% in May. Year-over-year, sales of existing homes declined by 0.7%. The sluggish pace of sales led to a 6.2% increase in unsold inventory on the market. That inventory now represents 4.6 months’ worth of supply. Different regions of the country experienced differing trends in existing home sales. For May, sales volume increased in the Northeast, Midwest, and South, while it decreased in the West. Year-over-year, sales increased in the Northeast and Midwest, while they declined in the South and West. See details at NAR.Realtor.
Home price growth cools in April 2025
The latest release of the S&P CoreLogic Case-Shiller U.S. National Home Price shows that home prices continued to grow in April, though at a slower pace than the previous month. The Index rose by 0.61% in April, compared with 0.77% in March. Year-over-year, national home prices are up by 2.72%. See home price data at SPGlobal.com.
2025 Q1 GDP drop deeper than first reported
The final estimate for the first quarter of 2025 Gross Domestic Product (GDP) showed that the economy’s decline during the quarter was worse than previously thought. The change in GDP was revised downward from -0.2% to -0.5%. The figures are reported at an annual pace and after seasonal adjustment. The decline in GDP during the first quarter indicates an abrupt slowdown in the economy, following a 2.4% annual growth rate in real GDP in the fourth quarter of 2024. It’s too early to tell whether this decline is just a temporary blip or a sign of the beginning of a recession. See GDP report at BEA.gov.
Mortgage rates dip for fourth straight week
30-year mortgage rates fell by 0.04%, to reach 6.77%. This was the fourth consecutive week in which mortgage rates have fallen, though in each case the moves have been slight. 30-year mortgage rates fell by a total of 0.12% in June. 15-year mortgage rates have also fallen for four weeks in a row. The decline in 15-year rates has totaled 0.14%, leaving them at 5.89%.
Personal income and spending declined in May
US personal income fell by $109.6 billion in May, a 0.4% decline. This is an ominous sign for the U.S. economy. With personal income falling, consumers began to rein in their spending. Personal consumption expenditures fell by 0.1% during May. Cuts to government benefit payments and loss of income by farm proprietors were cited as leading reasons for the decline in personal income. See report at BEA.gov.
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