Anna Maria Andriotis
speaker
3,396 appearances
52 recordings
1 series
first heard Jul 2017
last heard Dec 2022
Anna Maria Andriotis’s voice in public audio — every appearance, attributed to the second.
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None of that happened.
So essentially you have a mix of the government giving people financial assistance, something that helped many unemployed people to continue making their payments, to not fall behind, also mixed in
with lenders allowing people to not make their payments on their debts, be it their mortgage or their auto loan or their credit card, and to not report them as being late to the credit reporting firms.
All of that has helped people's credit scores.
The decline in spending has also played a role because a significant share of people's credit scores isn't just based on whether they're paying their debts on time or not,
But it also factors in the ratio between the amount of credit card debt that they have compared to their card spending limits.
So as people spent less, as people got money from the government and put that towards paying down their credit card debt, all of this helped to, for some people, keep their scores steady.
But on average, it helped to increase scores in the U.S.
So in normal circumstances, one would say credit scores increase.
That's a great sign.
It's a great sign of consumer financial health and should mean that lenders should feel more confident to lend to more people, but we're in anything but normal circumstances.
And the fact that scores have increased really is one more challenge that plays into the underwriting process for lenders.
So when they're getting loan applications from people who have high credit scores, 720 or higher,
that should in normal circumstances mean that these people are not a big credit risk and that they will likely be approved for the loan that they're applying for.
But now lenders are basically looking at the scores, looking at credit reports and saying, well, wait a minute, you know, these files are not reflecting whether these people haven't paid their debts in several months because that's not being reported onto credit reports.
And
credit scores are based off of the information in credit reports.
So how do we as lenders determine if this person is truly a good risk or not?
Somebody could have a high credit score and be unemployed for several months, but the credit score doesn't factor in employment status or
income.
Showing 1421–1440 of 3,396 · page 72 of 170
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