Loan Denials News

financeeconomy1 year ago•2 min saved

"Rising Interest Rates Lead to Increased Loan Denials for Americans"

A Bankrate survey found that 50% of Americans have been denied loans or financial products since the Federal Reserve began raising interest rates in 2022. Credit card applications were rejected most frequently, and lending standards have tightened as banks respond to higher rates. The denial rate is higher for those with lower credit scores, emphasizing the importance of maintaining a good credit score to mitigate the impact of higher interest rates.

via Fox Business|

#federal-reserve #financeeconomy #inflation

finance2 years ago•3 min saved

The rising trend of mortgage rejections due to low income

A report from the Consumer Financial Protection Bureau reveals that mortgage applications are being rejected due to "insufficient income" at the highest rate since records began in 2018. In 2022, 9.1% of home purchase applications were denied, with refinance applications being rejected even more frequently at a rate of 24.7%. Insufficient income accounted for over 50% of denials for Asian American applicants, 45% for Black and Hispanic applicants, and approximately 40% for white applicants. The average cost of a monthly mortgage payment increased by 46% in December 2022, reaching $2,045. Rising home prices, interest rates, and increased debt levels are contributing to the higher rates of income-based mortgage denials. Lenders are also scrutinizing applicants' debt-to-income ratios and credit scores, with a higher score often resulting in a better mortgage rate.

via CNBC|

#finance #home-prices #insufficient-income