In the wake of the recent national economic recession, many New York residents experienced drops in their credit scores. Different forms of financial liabilities affect a person's credit score, ranging from education and home loans to credit card balances. Such factors can directly influence if individuals can obtain future access to credit.
For people struggling to rebuild their credit histories, there appears to be good news on the horizon. Equifax, an American company that keeps tabs on people's credit scores, has reported that more people with low credit scores are getting approved for credit cards. For example, it now appears that one out of every three new credit cards is going to a person with a sub-prime score.
Generally lenders view individuals with low credit scores as risky. The lenders fear that such people may get into credit card debt and may become unable to satisfy their financial obligations. This turnaround suggests that lenders are willing to take more risks due to an overall improvement in the economy.
Another credit reporting agency, TransUnion, has reported that overall Americans are also getting better at paying off their credit cards in a timely manner. As consumer debt improves, people will be able to use their incomes to save instead of simply keeping up with ever-present bills. All of these factors suggest that the economy is making steps toward improvement.
Improvements in the economy generally benefit everyone, but those people who suffering from overwhelming debt may not feel any less stressed over their financial health. For such individuals, options such as bankruptcy exist that can help consumers get back to solid financial footing. Bankruptcy is a legal process that must be weighed in each individual's unique case to determine if it will yield an overall beneficial result.
Source: NorthJersey.com, "Consumers take on more credit card debt," Kathleen Lynn, Aug. 26, 2014