Wednesday, July 6, 2011

Strengthening Credit

One thing you have to say about tough economic times: They sure force people to act more responsibly with their money. We've noted several times that credit card usage dropped dramatically during the economic downturn. That can be shown by looking at the ratio of consumer-debt payment to income, which is the lowest it's been since 1994.

As a result, consumer credit scores are now the best they've been in four years. According to the credit-reporting agency Equifax, the average American credit score now sits at 696 out of a possible 850.

And maybe even better, people are starting to look for loans again. Consumer lending grew in the first quarter of 2011 - the first time that's happened since 2005. Extra money circulating through the economy will certainly help this recovery along.

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