Tightening Consumer Credit Standards
According to a Federal Reserve survey of senior loan officers at major banks, the majority of banks have been tightening their consumer lending terms. In fact, over 60% of banks report that they’ve been actively lowering credit limits, with just under 40% saying that credit limits have remained unchanged.
While this accords well with the widespread reports of reduced credit limits that we’ve seen, I know for a fact that there have been some selective increases. After all, American Express recently increased out credit limit by roughly 25%.
As for credit scores, nearly 52% of banks reported that they’ve increased the credit score required to secure a line of credit, whereas just under 49% have reported no changes. Nor surprisingly, none of the banks surveyed said that they were making it easier to get credit. This is just one more reason why you should be working to improve your credit score.
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