Consumer credit directly impacts the lending environment, and a recent report reveals that American borrowers are on the rebound.[IMAGE]
The consumer survey from ""CreditForecast.com"":www.creditforecast.com/, a joint effort between ""Equifax"":www.equifax.com/ and ""Moody's Analytics"":www.moodyskmv.com/, predicts the continuation of steady economic growth among all major sectors during the year ahead.
Numbers from the mortgage lending portion of the study showed that outstanding balances on home mortgages have declined by $1 trillion since 2008. Additionally, the data demonstrated that a continued drop is likely.[COLUMN_BREAK]
In less favorable news, however, originations are not improving as significantly as hoped as a result of the all-time low mortgage rates. While refinance shares are on the uptick, tighter lending guidelines are keeping new loan volume low, and CreditForecast.com notes that around 80 percent of all new mortgage originations are being made in the prime risks segment.
General consumer lending totals are headed down, and the report displayed increasing reductions in overall debt. Consumer balances decreased by $187.8 billion off of 2009 numbers.
The survey noted that credit ""more appropriately matches consumer wealth and income levels today,"" and the results also indicated a 41 percent rise in credit card inquiries since recession lows. According to CreditForecast.com, new bank credit card accounts hit 10 million during 2011, which marks the first time the benchmark has been reached since 2008.
Commenting on the findings, Equifax's chief economist, Amy Crews Cutts, said, ""After spending recent years in the financial doldrums, U.S. consumers are poised to make a comeback in 2012. The most promise we have seen has primarily been within the consumer spending and auto financing sector, while the housing market continues to see incremental progress towards gaining traction in the coming months.""