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The credit markets are still in a danger zone and everyone is feeling the pain

 

The credit crunch has now started to take under small banks, businesses and even students looking for college loans.

The credit crunch that has seen some of wall streets largest banks such as Bear Stearns and large regional banks such as IndyMac fail is now directly responsible for hurting one of the greatest areas of need in the this country for lending student loans.

College students are often borrowing up to 80% of their costs of tuition and have historically had a number of areas to turn to for this funding from their local banks, to specialty student loan lenders and government agencies. These sources have all but disappeared as the capital markets have tightened that capital is almost non existent.

The credit crunch is also hurting small businesses that seek operating capital or funds to grow their business. The market for these types of loans has traditionally been with small regional banks or specialty lenders. These companies have also tightened their lending guidelines making the capital for growth and acquisition extremely difficult to obtain. Another area that has tightened during this period is auto loan financing. Credit requirements are tougher and most auto companies are going away from leasing out their vehicles.

The credit crisis continues to plague home owners who are looking for new mortgage loans as lenders have reduced their loan programs and tightened underwriting guidelines. There is another residual effect to the credit market crunch, higher interest rates on almost every type of mortgage loan as lenders scramble to try and recoup their losses.

8-25-2008 ? LoanNetwork.com

 

 

 

 

credit market crisis @ loannetwork.com

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