Find Out Why Banks Are Getting More Picky About Their Loans
If you need a quick infusion of cash, there’s some potentially bad news on the horizon for you. According to reports, banks and other lenders are becoming even more picky about who they lend money to, a huge hurdle for people with less than ideal credit who are struggling to just keep up with payments. In this issue, we’ll talk about what’s going on.
Banks and Other Lenders Becoming More Picky
Data reported by the Federal Reserve says that nearly 12% of U.S. banks have tightened their standards for auto loans in the first quarter. That’s up from just 3.3% last year, and is the highest level since 2011. As for credit cards, 8.3% of banks toughened-up on those as well.
Why Is It Harder to Get a Loan?
When it comes to credit cards, specifically, low interest rates that have shrunk profit levels for lenders have caused creditors to tighten their standards. Another reason for the overall tightening is the rising default rate on various loans. For example, the number of subprime auto loans – those needing a FICO score of 600 or less – that were 90 days or more late have been the highest since 2010. Also, the number of late personal loans and credit card payments has risen from 1.33% to 3.53%. Perhaps a harbinger of things to come, 18% of consumers are expected to default on a loan payment within the next year – that’s up from 12%.
But The Economy is Improving, Right?
While newscasts have been touting an improving U.S. economy for some time now, the rising wages haven’t been enough for many low-to-moderate income Americans to keep up with associated costs such as higher health insurance deductibles.
If Debt is Holding You Back, Call The Oswalt Law Group
Statistics tell us that while you can survive with bad credit, it’s usually not easy or cheap. Good credit helps you save a bit of money and enjoy life overall. If crippling debt is holding you back, call us here at The Oswalt Law Group. Since no two situations are alike, we urge you to take advantage of our expertise in debt relief and law by calling us. The first consultation is always free, so call us at 602-225-2222 for a free consultation.