Consumers poised to make comeback in 2012?
The overall consumer climate should continue to rebound in 2012, with both home loan and auto loan markets recovering, Equifax said in a recent report.
According to data from CreditForecast.com, which is a joint product of Equifax and Moody’s Analytics, consumers should look for and expect economic growth in 2012. Delinquency rates for credit cards and auto loans are back to pre-recession levels, Equifax said. Consumer debt is currently down $187.8 billion from early 2009 totals.
“After spending recent years in the financial doldrums, U.S. consumers are poised to make a comeback in 2012,” Amy Crews Cutts, Equifax Chief Economist, said in a statement. “The most promise we have seen has primarily been within the consumer spending and auto financing sector, while the housing market continues to see incremental progress towards gaining traction in the coming months.”
Promising data with credit cards
A few promising situations in the credit card sector have popped up. For starters, consumers are seeing more credit card offers. And this increase in solicitations coincides with a 41 percent increase credit card inquiries, Equifax said.
Last year, consumers opened more than 10 million new bank credit card accounts. This is the first time since 2008 that the 10-million mark was reached.
Mortgage balances decline
Home mortgage loan balance amounts have dropped by $1 trillion (10.4%) since 2008. While mortgage rates continue to hover near all-time record lows, the majority of mortgage activity in is the area of refinancing. The current market of low mortgage rates has yet to reflect in an influx of home purchase activity.
Auto loan demand up
Auto sales have risen, resulting in increased demand for auto loans. Auto loan inquiries up 27%, which demonstrates continued positive momentum, Equifax said.