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American Express Card: Leave Home Without It

A recent change that we have to pay attention to is how underwriters and banks will treat your debt with American Express. Everybody knows that most American Express accounts are required to be paid off monthly, so there really is not minimum monthly payment. You pay the whole thing off every month. There should be no debt to count against your debt ratios. But recently, Fannie Mae and Freddie Mac have decided, if you’ve got a balance on your American Express card, they want you to count 5% of the balance as the minimum monthly payment.

So, if you have a $5,000 balance on your American Express, even though you’re going to pay it off that month as you always do, they’re going to count $250 a month against your debt ratio and that’s something that a lender will need to know, and the consumer needs to know, is going to count against their debt ratios.