The banking industry has certainly taken a devastating blow in recent years. Many borrowers found themselves without work, which meant loans went unpaid and into default. This scary situation made banks take a closer look at their lending policies, and the result was that fewer loans were made. And of the loans that were made, often times the terms were less than desirable. For those that were “lucky” enough to have a loan application approved, many times the interest rate was high and this meant higher monthly payments. The end result was much the same as when under or unemployment were factors, and many extensions of credit went into default.
Now that the news reports a little more positive outlook for the economy, it is natural to wonder if this means the banks are on the rebound and will make more loans. With a new year here, the best place to look for this answer is to the prior year. In January 2015 the Financial Post had this to say:
- Housing activity in the United States was mean to play a major factor in helping stocks rebound in 2015, which could mean a loosening up of lending practices.
- As default rates have declined, the instance of approving more loans has increased.
- Certain decisions by the Federal Reserve, including the decision to delay implementation of some practices, will lead to an increase in lending.
What all of this means for the U.S. consumer is that the chances of obtaining a loan are greater now than they have been in recent history. But, with new lending comes new risk. There is never a guarantee that you will not lose your job or be forced to take a position with a lower salary, which means the possibility of taking out a loan you cannot repay exists. Or, it may be that you have already found yourself unable to make certain payments and are wondering what you can do to avoid collection efforts. One option is to ask for a deferment of payments, and another choice some consumers make is to file for bankruptcy. We can help by analyzing your particular set of circumstances, and making recommendations as to which course of action works best for you.
If you have questions about finances, contact us at www.DsouzaLegalGroup.com. We will help by coming up with solutions that work for you.