As the U.S. economy continues its struggle to climb out of a deep recession, personal loans remain very difficult to secure. Having shouldered much of the blame for the financial hardships that have befallen consumers across the nation, many banks now require potential borrowers to meet strict criteria for an approval. With the financial institutions being more selective about who they assist, Detroit locals like Ashley Wright are learning that consumers with excellent credit and decent paying jobs are the most likely to make the cut. "Getting an approval was definitely a journey," said Wright, who was in search of a personal loan to help out with school and living expenses. Wright found that a private bank was the best place to turn for …show more content…
"I also tell them to make sure they start with a card that has a zero balance and to make sure they always pay it off in full every month," he said. "This will have a dramatic effect on anyone 's score." Lenders closely observe a number of factors when considering an applicant for a personal loan. Factors that heavily influence their decision are the prospective borrower 's assets and liabilities, a percentage known in the financial world as debt ratio. "Debt ratio is calculated by adding up all of your debt and dividing it by the amount of your assets," McCarthy explained. "Understanding this calculation can hopefully make someone aware of how they can lower their debt ratio. The best way is to simply pay down the debt you 've currently accumulated." When applying for a personal loan, borrowers often base their hope for approval on things like credit history and collateral. However, as McCarthy mentions, the size of the applicant 's down payment has a definite impact on the lender 's decision. "I advise my students to save as much as possible (when) preparing for applying for their loan," he noted. "Having a significant down payment is a big deal in the eyes of the lender. It shows you are willing to risk your hard-earned money on the purpose of your loan. It significantly increases your chances of getting approved. I always
The Great Recession was the general economic decline observed in world markets around the end of the first decade of the 21st century. The Great Depression was a severe worldwide economic depression in the 1930s.
Max: Hi I’m Max Lessins. This is Crash Course for economics and today we’ll be discussing the Great Recession, focusing on the fiscal and monetary policies used to recover from the 2008 economic meltdown.
At the end of the 20th century, it was clear that the United States national economy was on a incline. The U.S began winning the worldwide arms race, holding 50% of the world weapons stockpile (Taylor 10). Capitalism, the main trademark of the United States economy, spread like a wildfire across the majority of the world (Taylor 10). To the uneducated ear, news like this sounds great; the United States is slowly taking over the world. However, this insane growth was actually poising the U.S. for an extreme downfall in the coming years of the early 21st century. The major downfall would come to be known as the worst recession in our history since the infamous Great Depression.
In 2008, the housing market crashed and America fell into a recession. Many Americans lost their homes. Many investors lost large sums of money, and overall the economic recession hurt America as a whole. Today, we see that the stock market is more regulated than it was in 1929 with the Great Depression and 2008 with the Great Recession, but it is still not regulated as much as it previously was. In 1999, portions of the Banking Act of 1933, more commonly known as the the Glass-Stegall Act, were repealed. The repeal of the Glass-Stegall Act in 1999 sparked the Housing Crisis of 2005 and ultimately led to the Great Recession that America experienced in the 2000’s.
The single greatest problem facing America today would be the threat of a Recession in the stock market. Because if America goes in to Recession again the stock market will crash again. Then we would not need to worry about this stupid war because we will be broke.
The recession of 2007-2009 played a great roll in how many companies in the United
Ever since World War II the United States has experienced many recessions. There have been many terrible recessions that have hit this great country hard. What is a recession people may wonder? A recession is a significant decline in activity across the economy, lasting longer than a few months. It is visible in industrial production, employment, real income and wholesale-retail trade. The technical indicator of a recession is two consecutive quarters of negative economic growth as measured by a country 's gross domestic product (GDP). Although, the recession of 2001 wasn’t a dramatic and horrible recession, it was the end of the longest expansion our country had seen since WWII. The expansion following the recession of 1991 was 10 years up until this recession of 2001. Furthermore, this recession was difficult and was hard to deal with and overcome, because during the time of this recession our country experienced 9/11.
For some, there are just goods that they consider absolutely essential to their existence, often to the point of spending every cent just to have these. In turn, they rely on loans, and survive from paycheck to paycheck. But living on credit will then lead to a lifetime of hardship to pay off all their loans. If worse comes to worst, some may even default on these loans. But don 't blame the loans. In fact, a good credit profile can improve your credit score. Before applying for a loan, you must first learn all about loans. That is the first component in good personal money management. And during this time, when we are all being hit hard by the worldwide financial crisis, we all need to be astute when it comes to handling money. Here 's the scoop on loans. Basically, loans are quantities of money that you borrow from a lender, which can be repaid over a set period of time with the inclusion of interest. Interest is a percentage of the loan which the bank earns in return extending credit to the borrower. Loans can be secured, or where the borrower stakes a piece of his property to acquire the loan, also known as a collateral; or unsecured, where no collateral or tangible asset is pledged. One particular example of loan that many need to learn more about are bad credit loans. Those with good credit scores have a history of paying on time, and satisfying their debt obligations, while those with bad credit scores have a penchant towards late payments and neglected loans. This
According to Investopedia.com, “A recession is a significant decline in activity across the economy, lasting longer than a few months. It is visible in industrial production, employment, real income and wholesale-retail trade. The technical indicator of a recession is two consecutive quarters of negative economic growth as measured by a country's gross domestic product (GDP); although the National Bureau of Economic Research (NBER) does not necessarily need to see this occur to call a recession.” Fiscal policy is the use of government spending and taxation to try to influence the economy. This is done many times in an attempt to prevent a recession or at a minimum, to try to stabilize the economy. Monetary policy is the central bank, currency
Recession is termed as a period of temporary economic decline during which trade and industrial activity are reduced, generally identified by a fall in GDP in two successive quarters. Based on the complete recession that took place few important points that I could gather in specific considering each type of recession are listed below. How it took place? Causes for it and what impact it had on the audience. Let me discuss about this in brief.
Step two. Again, from the example, individuals qualify for loans based on their current income and expenses. Often a good part of their expenses are credit card debts. In our failing economy, credit card interest rates have skyrocketed. In many instances, people cannot qualify for a certain loan because their credit card payments and other
High default rates can be attributed to multiple factors. There is, however, a widespread view that student characteristics and background mostly account for this policy dilemma, including (a) the characteristics of students as they begin college (i.e.
When it comes to housing, a consumer must make the decision between renting and owning a home. First and foremost, the household must assess its financial status as well as its outlook for the future. Since most households do not possess the necessary financial resources or savings to purchase a house alone, a loan, or mortgage, must be taken out to meet such a heavy financial obligation. A borrower will apply for a loan from a lender through what is known as a primary market. The lender then evaluates the borrower’s financial status and decides whether to extend a loan and under what terms the loan will maintain. A loan can be obtained through banks, credit unions, finance companies, and a wide array of other sources of credit. Although, if payments are not made as
During a recession, the value or price of goods and services tend to fluctuate based on consumer’s ability to purchase. Furthermore, this action often leave producers in a position of not knowing whether he or she will be able to sale their current stock. One can conclude that the over stocked good will be sold for a much lesser price. But, the next season I believe that producers of a good like oranges will grow less, because fewer consumers will be able to afford it. Therefore, this makes income and demand related, which means that increased income will cause demand to rise and that a decrease in income will cause demand to fall.
Within the financial crisis of 2007, the U.S economy took a turn for the worst. The unemployment rate shot up to 10%(cbpp.org), and as a result there was less money within the economy for: goods, services, and this essay’s key topic; housing. As a result of this economic situation, there was a significant increase in the amount of houses being foreclosed upon. This was mostly caused by the owners of said houses taking out risky high interest loans, because of bad credit, while also being within financially troubled times. The risky and high interest loans caused a chain reaction that resulted in these people defaulting on their payments when “trigger events”, caused by or worsened by the financial crisis, occurred. It is now 2014, and many of the people who defaulted on their mortgage and had to foreclose are now starting to look towards the housing market again. However, they must be able to protect themselves from the problems that caused them retreat from the housing market in the first place. Luckily for these buyers, the current real estate market is a lot more favorable than what it once was. Now, many ways exist for the Boomerang buyer to bounce back and try their hand at obtaining a house again. These ways include the new Federal Housing Administration change, the rent-to-buy house buying option, and generally being prepared.