In another fuck up by the Biden Admin (yes, I too have lost count), the law of possibly unintended consequences has reared its head.
According to the NY Fed report, while over half of the newly delinquent borrowers already have subprime credit scores, around 2.4 million borrowers who entered delinquency this year had scores over 620 – which could have allowed them to qualify for auto loans, mortgages, and credit cards, prior to the delinquency being reported. 3.2 million borrowers whose scores were under 620 (56.6% of the newly delinquent population) saw their scores decline by an average of 74 points.
Another 2 million borrowers with scores between 620 – 719 (35.9% of new delinquencies) saw their credit scores fall by an average of 140 points – while there were 400,000 borrowers whose scores were above 720 (7.2% of new delinquencies) that saw their scores fall by over 100 points.
Apparently this delinquency or default rate is actually normal since the rates are now back to pre-pandemic levels according to the article. It’s just the fact that they hit all at once that’s causing such a fuss. The consequences of not paying loans back were just delayed.
And bringing the week full circle from Monday morning:
Midwest Chick's Place 
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