The world economy is a vast, complex phenomenon. Whether you are buying a home, refinancing your home, or planning on going into business for yourself, the world is a complicated place.
Not only is it a vast, complicated phenomenon, it is also a global one. And in the middle of that is the American economy. The middle class is the foundation for growth, and the only reason that growth has been possible is because of the middle class.
The middle class, we might say, consists of a certain percentage of the population that are “middle income”. This is the group that can afford to purchase homes and go out into the work world. The middle class includes the people who are able to have a career in a professional field. And the middle class includes the people who can afford to pay for college debt. But this middle class includes the entire segment of the population who are not middle income.
Again, the middle class is the segment of the population who are living paycheck to paycheck. They might be middle income but they still pay the mortgage, pay the credit cards, and pay the rent.
This is part of the reason why we should not be so quick to judge people with poor credit scores. Because many of the people who get poor credit ratings have been in the works and/or have family that can help them get it fixed.
A lot of things that we expect people to be able to do that they cannot actually pull off are very difficult for them. When I see people who have a good credit rating, but who can’t get a home loan (or are unable to get a loan), it bothers me.
Not to mention the people who are so financially independent that they can just walk out the door and live off of their own capital.
I get it. It’s hard to get a job. It’s hard to get a loan. It’s hard to get a car loan.
In the early 1980s, the financial crisis of the U.S. economy was one of the worst financial booms in the history of the world. As a result, loans for houses and cars went from being a relatively affordable form of credit to being one that was extremely difficult to get. According to data from The National Association of Realtors, the housing crisis cost Americans over a trillion dollars in lost earnings.
The same phenomenon played out for personal loans too. As the U.S. economy began to recover, the number of personal loans went down, but the number of people who were able to get credit skyrocketed. The rise in personal debt, however, was not just due to a decline in housing prices. Personal debt climbed just as fast as overall consumer debt did after the crisis hit.
