Smart Borrower Blog

Student Loan Debt Spikes 84 Percent Since Recession

Sep 10th, 2014 @ 8:53 PM by Amber Nelson

The total amount of student loan debt held by Americans hit a new high recently, according to credit bureau Experian, and that debt is affecting both young and old. Americans now carry a total of $1.2 trillion in college debt, an all-time high and an 84 percent increase since the Great Recession. That debt burden is spread out across 40 million people, an increase from 29 million in 2008. Every borrower has at least one student loan but the average borrower, however, has approximately four student loans, nearly double the roughly two-and-a-half from six years ago. The average balance for... Read full article »

Fannie Mae Rethinks 2014 Housing Forecast

Sep 3rd, 2014 @ 7:57 PM by Amber Nelson

Mortgage finance company Fannie Mae downgraded its 2014 and 2015 predictions in August for the U.S. housing market, forecasting less rosy outcomes based on the year’s lackluster performance so far. Compared with its July forecast, the Fannie Mae August forecast reduced its expectations for new single-family home sales by 11 percent to 431,000 for the year, down from 486,000. The forecast for single-family home construction starts was also slashed 8 percent from July, to 642,000 in 2014, down from 696,000. Fannie predicts now that total sales of existing homes will fall 3.5 percent this year from 2013, topping out at... more »

About Amber Nelson
Amber Nelson is a seasoned mortgage industry writer and a regular contributor to Loan.com and Mortgage101.com.

Cash is No Longer King – At Least for Millennials

Aug 27th, 2014 @ 8:11 PM by Amber Nelson

Plastic – credit and debt cards – have become so easy to use that one in three Americans prefers to use cards to pay for small, in-person purchases of $5 or less. The trend away from cash is most pronounced among the millennial generation – those between the ages of 18 to 29 – according to a new survey conducted for CreditCards.com Fifty-one percent of millennials preferred to use plastic for purchases under $5, the only generation with a majority in that category. Compare that with those in the over-65 age group, where 82 percent prefer to use cash. The... more »

About Amber Nelson
Amber Nelson is a seasoned mortgage industry writer and a regular contributor to Loan.com and Mortgage101.com.

Auto Loans Growth Remains Strong As Mortgage Debt Drops Off

Aug 20th, 2014 @ 8:04 PM by Amber Nelson

Total household debt fell slightly in the second quarter, according to the latest report from the Federal Reserve Bank of New York, as Americans pulled back on mortgage debt. “A slight decline in real estate-related balances, consistent with broader housing market developments, contributed to a flat quarter for total outstanding household debt,” said Donghoon Lee, senior economist at the New York Fed. “Meanwhile, we observe continued strength in the auto loan market with the largest volume of originations since 2006.” In the second quarter, mortgage debt fell $69 billion from the first quarter, although it is up $255 billion from... more »

About Amber Nelson
Amber Nelson is a seasoned mortgage industry writer and a regular contributor to Loan.com and Mortgage101.com.

Small Business Lending Dips While Delinquencies Rise

Aug 13th, 2014 @ 7:47 PM by Amber Nelson

For the second month in a row, small U.S. businesses cut back on their borrowing in June, according to new data from PayNet, and at the same time delinquencies on small business loans rose to the highest level in a year. The Thomson Reuters/PayNet Small Business Lending Index, which draws on information from more than 250 leading U.S. lenders, registered a monthly decrease to 120.6 in June, down from May’s 125.4 reading. The good news, however, is that compared with a year ago the index is up 15 percent, the fourth month of yearly increases. Small company owners are more willing... more »

About Amber Nelson
Amber Nelson is a seasoned mortgage industry writer and a regular contributor to Loan.com and Mortgage101.com.

Report: Student Loan Debt Will Not Cause Mortgage Meltdown-Type Crisis

Aug 6th, 2014 @ 7:53 PM by Amber Nelson

Student loan debt has been growing at a troublingly high rate over the past seven years, a trend that has student advocates asking Congress to act to prevent another economy-wide financial crisis like the housing market crash that led to the Great Recession. Yet a new report from The Vanguard Group says the potential problems that escalating student debt could cause are not at all likely to have the same devastating effects as the mortgage meltdown. “The growth of student loans is quite important, and in some sense, if anything, that’s the only similarity to the mortgage crisis,” says Roger... more »

About Amber Nelson
Amber Nelson is a seasoned mortgage industry writer and a regular contributor to Loan.com and Mortgage101.com.

HAMP Applications Face Major Backlog

Jul 30th, 2014 @ 7:37 PM by Amber Nelson

For those still hoping to get a mortgage modification under the Obama administration’s Home Affordable Mortgage Program (HAMP), the wait may now be longer than ever. A new report from government regulators found that mortgage companies have not been able to process applications fast enough. The report from the special inspector general for the Troubled Asset Relief Program (TARP) stated that as of the end of May there were more than 221,000 HARP applications still waiting to be processed. That’s a big jump in the backlog from the previous six months when there were 133,649 applications in the queue. The... more »

About Amber Nelson
Amber Nelson is a seasoned mortgage industry writer and a regular contributor to Loan.com and Mortgage101.com.

Is There A New Subprime Bubble In Auto Lending?

Jul 23rd, 2014 @ 7:43 PM by Amber Nelson

About 25 percent of all new car loans made in 2014 were issued to borrowers with subprime credit – those with scores below 640 – and investors are eating up subprime-backed auto securities. This has some analysts wondering if the next financial bubble has arrived in the form of poor-credit car loans. Subprime auto loan volume jumped roughly 15 percent in the first quarter of this year compared with the first quarter of 2013, rising to $145.6 billion, according to credit rating company Experian. The New York Times reported that these loans can come with interest rates in the range... more »

About Amber Nelson
Amber Nelson is a seasoned mortgage industry writer and a regular contributor to Loan.com and Mortgage101.com.

Consumers Change the Way They Use Credit Cards

Jul 16th, 2014 @ 3:13 PM by Amber Nelson

Americans have made a significant shift in the way they view and use their credit cards, according to the latest report from the American Bankers Association. The ABA found that bank card delinquencies fell in the first quarter back to lows from more than two decades ago. Late payments – those behind by 30 days or more – on bank cards dropped to 2.44 percent of all accounts, down from 2.60 percent in the previous quarter. The rate is just higher than the 2.41 percent from the first quarter of last year, and the last time rates were that low... more »

About Amber Nelson
Amber Nelson is a seasoned mortgage industry writer and a regular contributor to Loan.com and Mortgage101.com.

Small Business Loan Approval Reaches Post-Recession Peak

Jul 9th, 2014 @ 8:09 PM by Amber Nelson

Small business owners today are seeing more success in obtaining loans than they have in the past five years, according to new data from Biz2Credit.com, with loan approvals reaching their highest rate since the financial crisis began. The Biz2Credit Small Business Lending Index, a measure of 1,000 loan applications submitted on the website, rose in June showing that one out of five or 20 percent of small business loans were approved by big banks, up from 19.6 percent in May. The approval rate by small banks fell slightly by 0.2 percent, but the overall approval rate is still more than... more »

About Amber Nelson
Amber Nelson is a seasoned mortgage industry writer and a regular contributor to Loan.com and Mortgage101.com.

Student Loan Interest Rates Reset Higher

Jul 2nd, 2014 @ 8:23 PM by Amber Nelson

As of July 1, federal student loans will have a higher interest rate this year than they did in the 2013-2014 school year. While rising fees are never welcome news for students, the silver lining is that they are not rising as high as they could have. The new effective rate on all new federal Stafford student loans will be 4.66 percent for the 2014-2015 school year, up from 3.86 percent last year. Without Congress’ quick passage of the Bipartisan Student Loan Certainty Act of 2013, the interest rates would have doubled this year to 6.8 percent. While the new... more »

About Amber Nelson
Amber Nelson is a seasoned mortgage industry writer and a regular contributor to Loan.com and Mortgage101.com.