Do you want the good news or the bad news first?
Just last week, our friends at FICO reported a few of their observations and warnings about the current credit market. There is some positive and negative findings for clients within the report that you may want to discuss with them.
First, small business lending is increasing, and the trend appears to be stable. This is welcome news, and is long overdue. The hoarding of cash by banks and other financial institutions has been met with much criticism; this is a strong sign that this problem is coming to an end. As the average credit score increases, we should see a return to easier access to credit across the board.
FICO did sound the alarm on a potential housing bubble. A sizable minority of homeowners are still underwater even though residential home prices are rising. Mortgage experts feel that this is a very volatile situation, one that is unsustainable and recession-inducing. Your customers count on you to keep updated on the latest happenings with banks and other lenders. Time will tell if their fears are right, but it’s best for all of us in the industry to remain abreast of these trends.
In times of economic crises, the credit repair industry is exceptionally valuable, as lenders tighten their standards and decrease the amount they are willing to lend. While we are unlikely to see another recession like 2008 anytime soon, it is still vital for consumers to keep their credit scores in the best possible shape.