Credit literacy: first line of defense against bankruptcy
Article Abstract:
Personal bankruptcies have become the number one consumer financial problem in the US. The record number of 1.12 million personal bankruptcy filings in 1996 is expected to increase even higher to 1.44 million before the end of 1997. This translates to about one bankruptcy in every 100 American households. To resolve this problem, the Consumer Federation of America (CFA) has proposed limiting the credit lines granted to households to no more than 20% of their annual income. The credit industry opposes this proposal, contending that it is contrary to the principle of competition and that the CFA report about consumer debt growth has been 'grossly distorted.' The best solution to the worsening problem of personal bankruptcies may be for the credit industry and consumer interests to work together to provide consumer education. A broad-based effort can help ensure that more audience are reached.
Publication Name: Credit World
Subject: Banking, finance and accounting industries
ISSN: 0011-1074
Year: 1997
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The outlook for household credit conditions
Article Abstract:
Household credit conditions are deteriorating. In 1995, personal bankruptcy filings increased to levels last witnessed after the 1990-91 recession. Further, credit card delinquency rates also rose sharply to levels last seen during the last recession. One reason for this worrisome trend is the steady reduction of credit standards since the start of the 1990s, as evidenced by increasing loan-to-value ratios and the eagerness of lenders to expand loan commitments. Strong household borrowing and rising interest rates in 1994, which boosted household debt service burdens, can also be blamed for the deterioration of household credit conditions. The weak economy during the first half of 1995 and the unexpected federal income tax bills also contributed. However, the outlook for 1996 is good, in light of tightened lending standards, decline in interest rates in 1995 and a stronger economy.
Publication Name: Credit World
Subject: Banking, finance and accounting industries
ISSN: 0011-1074
Year: 1996
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How to make a dark horse shine - what you need to know about marketing credit to Hispanics
Article Abstract:
The Hispanic market is considered the 'dark horse' in the race among financial services providers. It is receiving little attention as institutions focus on the increasingly saturated mainstream segment of the American marketplace. The credit industry will miss out on attractive opportunities if it continues to ignore the Hispanic community. The Hispanic market is huge, currently accounting for 10% of the US population and expected to grow to 20% by the year 2050. Hispanics also have substantial credit requirements since many of them are young and just starting their families. Although they tend to have smaller disposable incomes than whites, Hispanics are good credit risks and will spend large amounts of money on goods and services they believe to be essential.
Publication Name: Credit World
Subject: Banking, finance and accounting industries
ISSN: 0011-1074
Year: 1996
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