Loans and Finance

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Thursday, March 01, 2007

The Forthcoming Credit Squeeze

Those of you who are heavily in debt, and rely upon debt to pay your debt, be warned; there is a credit squeeze coming.

Aside from the prospect of further interest rate rises, which increases the cost of borrowing, banks and credit card companies are in the process of reviewing their customers' debt portfolio and tightening up their terms and conditons.

Such changes include; reducing credit limits, refusing new loan applications and reducing the amount of cash that you can withdraw via credit cards.

All of this will cause pain to those who are heavily in debt, and living "at the end of their credit lines", by forcing them to address their indebtedness.

A cynic might argue, that had the banks and credit card companies been a little more stringent in the first place with regards their customer portfolio, then there would be no need for this credit squeeze (shutting the stable door after the horse has bolted) now.

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