Ever since the recent financial calamity, a great deal of attention has been given to the banking and finance industries in the US and how they're administered. Previously, US banks were being overly aggressive when granting loans in order to maximize their income and revenues.
It only took a small dip in the economy to offer the catalyst for an acceleration of homeowners becoming delinquent on their mortgages and the complete situation snowballed. It was over exposure to toxic loans which lead to a situation where much needed loans weren't being granted and several found their selves without the required capital which they required to operate In order to prevent the same thing from happening again in the future, the US government has introduced sweeping changes to the banking and finance industries so as to protect clients from exposure to debt in the future. The crisis in itself has changed the mind set of many people anyway and a growing number of US citizens are now questioning the significance of home ownership and credit in a whole.
In addition to tightening up regulations with regard to who gets a loan and who doesn't, further restrictions have also been placed on other credit sources such as credit cards. The ethics of certain practices have been called into question and its no longer possible for credit card issuers to change interest rates after a purchase has been made and greater notice has to now be given before any changes are made. These changes are designed to give customers the chance to pull out of any transactions if they feel that they can't afford them.
Few regulations have been introduced to aid clients who have already suffered financial hardship due to the financial crisis. Homeowners who have found that they could no longer afford to pay their mortgages, for example, are able to apply to the home affordable modification program (HAMP).
This program permits debtors to apply to have their monthly payments adjusted to a lot more affordable level permitting them to keep their home and avoid acquiring a bad credit rating. Other instances include short sale regulations, in which home owners receive a degree of support and protection from the government should they find themselves unable to keep their home and their property is worth-less then the outstanding amount as a result of the lender.
While some individuals argue that stricter regulations pertaining to who can and cannot qualify for credit might affect many people and small businesses adversely, its still believed that the greater protection and regulation will be helpful in the long run.
The financial calamity affected not just those who did have loans and lines of credit, but even many others who didn't because business went bust and employment rose. Although an individual may not be pleased at not being granted the loan that they applied for, it could well turn out to be in their best interests and had such regulations been in place beforehand then maybe the recession would never have occurred in the first place.
It only took a small dip in the economy to offer the catalyst for an acceleration of homeowners becoming delinquent on their mortgages and the complete situation snowballed. It was over exposure to toxic loans which lead to a situation where much needed loans weren't being granted and several found their selves without the required capital which they required to operate In order to prevent the same thing from happening again in the future, the US government has introduced sweeping changes to the banking and finance industries so as to protect clients from exposure to debt in the future. The crisis in itself has changed the mind set of many people anyway and a growing number of US citizens are now questioning the significance of home ownership and credit in a whole.
In addition to tightening up regulations with regard to who gets a loan and who doesn't, further restrictions have also been placed on other credit sources such as credit cards. The ethics of certain practices have been called into question and its no longer possible for credit card issuers to change interest rates after a purchase has been made and greater notice has to now be given before any changes are made. These changes are designed to give customers the chance to pull out of any transactions if they feel that they can't afford them.
Few regulations have been introduced to aid clients who have already suffered financial hardship due to the financial crisis. Homeowners who have found that they could no longer afford to pay their mortgages, for example, are able to apply to the home affordable modification program (HAMP).
This program permits debtors to apply to have their monthly payments adjusted to a lot more affordable level permitting them to keep their home and avoid acquiring a bad credit rating. Other instances include short sale regulations, in which home owners receive a degree of support and protection from the government should they find themselves unable to keep their home and their property is worth-less then the outstanding amount as a result of the lender.
While some individuals argue that stricter regulations pertaining to who can and cannot qualify for credit might affect many people and small businesses adversely, its still believed that the greater protection and regulation will be helpful in the long run.
The financial calamity affected not just those who did have loans and lines of credit, but even many others who didn't because business went bust and employment rose. Although an individual may not be pleased at not being granted the loan that they applied for, it could well turn out to be in their best interests and had such regulations been in place beforehand then maybe the recession would never have occurred in the first place.
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