Americans seem to have an appetite again for car loans and leases, credit cards and personal loans. Wall Street Magazine (WSJ) reported.
Demand for these types of borrowing rose 39 percent year on year in April and 11 percent over April 2019, WSJ reports citing statistics. Equifax…
The relationship is the opposite of what it was in 2020, when consumers were generally not interested in credit cards or personal loans, either because there was no need due to stimulus checks or extended unemployment benefits, or because the stock market was doing well. according to WSJ. Others simply did not want to spend money due to the instability and uncertainty of the economy amid the pandemic.
Things started to change when vaccines were introduced that helped the economy speed up recovery, according to the WSJ. Americans now spend a lot of money on cars, vacations, and dining out. The market also saw an increase in car prices, which led to an increase in the need for loans.
Lenders, meanwhile, are signaling they are open to increasing consumer debt after banks tightened underwriting requirements at the start of the pandemic. Lenders also mailed 127 million requests for personal loans to people’s homes in May, up 60 million from the previous year, according to the WSJ.
Consumer credit card debt fell to its lowest level since 2017. PIMNTS borrowings are reported to have declined in January. These numbers offset the growth in borrowing in categories such as vehicle loans and training.
The decline in borrowing in January showed that total consumer loans fell 0.4 percent to $ 4.18 trillion.
“We expect consumer lending growth … to accelerate in the coming months as spending comes back to life in response to a healthier labor market and stronger financial support,” Nancy Vanden Houtena senior economist at Oxford Economics said in March.