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Keeping Borrowers Current In A Pandemic

Fed Warns Credit Scores May Lose Some Power After Covid

Fed Warns Credit Scores ‘May Lose Some Power’ After Covid The Federal Reserve Bank of New York warned that credit scores the all-powerful number that can determine if a consumer is able to qualify for a loan, rent a home or even buy car insurance might have gotten less reliable during the coronavirus pandemic. Scores for homeowners who took advantage of payment relief on their mortgages actually rose an average of 14 points over the course of the pandemic, according to a new analysis by the New York Fed. That was a bigger jump than the seven-point increase seen among borrowers that didn’t take forbearance on their loans.

Cancel Our Debts, Then Cancel Debt

The story of the pandemic is also a story about debt. One recent survey, conducted in October, found that more than a quarter of respondents had accumulated over $10,000 in new debts during the crisis. One in three had taken out a new credit card. An analysis from Philadelphia found a 70 percent increase from last year in people paying rent on credit and that, by December, rent-burdened households will owe roughly $7.2 billion in back rent, an average individual burden of $5,400. The crisis of American debt predates the pandemic, but it’s clear that nine months of record unemployment and little relief has sharpened the knife for millions of people. Meaning, conservatives in Congress have created the conditions to bury people, while their establishment counterparts in the Democratic Party have displayed a stunning lack of imagination or urgency in crafting a response. The current reality faced by millions of people compounding rent, student, medical, and credit card debts is unten

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