Getting approval for mortgages, credit cards and auto loans seems almost impossible these days—but bankers say they are lending. According to CNNMoney, this comes in response to recent accusations from politicians, who say that financial institutions are failing to extend credit even after receiving billions of dollars in taxpayers’ funds over the past few months.
So, why is it so hard to get a loan? In the article, experts say it probably has to do with the many non-banking entities that provide credit, often referred to as the "shadow-banking system." The entities have withdrawn massive amounts of financing from the broader economy.
And, while community banks and credit unions have attempted to make up for the void, they cannot keep up with the demand for loans.
Source:
CNNMoney: Why You Can't Get A Loan
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