Loan providers getting choosy

Mon, 12 Nov 2007

Lending criteria appear to be tightening for people looking to take out loans , it has been claimed.

Research by moneysupermarket.com found that acceptance rates for loans have fallen each month over the last six months, with the figure standing at 51.72 per cent in October.

Tim Moss, head of loans at the firm, said that although banks claim they are not "getting choosy", the company's findings suggested otherwise.

"Loan acceptance rates are decreasing, showing that now, more than ever, providers are looking for lower risk customers to help reduce the chances of having bad debts on their books," he commented.

As mortgage payments increase and energy bills and petrol prices continue to rise, consumers are likely to have less disposable income so things are expected to "get tougher", he added.

In related news, James Caldwell, director of Fair Investment Company, said that an interest rate cut would have benefited householders "struggling" to find affordable credit .
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