If it's seemed tougher to get a bank loan in recent months, it's not just your imagination -- a new U.S. Federal Reserve survey provides evidence it really was.

In its quarterly check of senior lending officers at major banks, the Fed found residential mortgages were more difficult to come by than at any time in the 17 years it has been conducting the survey, MarketWatch reported Monday. The survey showed 41 percent of the banks have tightened standards for borrowers with the best credit records, up from 15 percent in July. The Fed also found that 60 percent of the banks had raised their standards for nontraditional loans and 55 percent had upped the ante for subprime mortgages, MarketWatch said.

About half the banks reported weaker demand for residential mortgage loans.

Banks also tightened standards for consumer loans. Credit standards for consumer loans other than credit cards tightened at the fastest rate in more than 12 years. Standards for credit cards were largely unchanged, but standards for other types of loans were increased by 28 percent of the banks.

It wasn't just consumers who saw loan requirements get stricter. The same was true for commercial and industrial loans.  // Copyright 2007 by United Press International




Publication date: 06 November 2007   

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