Ten Years After the Great Recession, Consumer Credit Market
on an Upward Curve
A decade after the biggest financial crisis to the hit the United States since the Great Depression, much has changed in the consumer credit marketplace. Serious delinquency rates have mostly fallen since that period, while the credit quality of consumers has improved. Yet, the crisis has had a profound effect on consumer access to credit and the relationship they have with it.
“From a credit perspective, the financial crisis of 2008 was one of the most trying times in Americans’ lives. Unemployment rates jumped, housing values sunk to levels that caused hundreds of thousands of homeowners to go ‘underwater’ on their mortgages, and the ability to gain access to credit became difficult for millions of consumers. As a result, massive shifts in how consumers paid their debts took place. Ten years later, we now see the repercussions from that period, but fortunately for the overall economy, consumers are generally in a much better place today.”
Matt Komos, Vice President of Research and Consulting at TransUnion
Now & Then: Changes in Consumer-Level Delinquency Rates Since the Financial Crisis
TransUnion’s Q2 2018 Industry Insights Report (IIR) found that of the four major credit products – auto, credit cards, mortgages and personal loans – mortgage loans were most impacted by the financial crisis, which continues to affect the industry today. Other observations over that time showed only modest, short-lived increases in serious delinquency rates for auto loans, credit card delinquencies have been cut in half, and personal loans are approximately 30% below what was observed ten years ago.