🕵️‍♂️ 7 At-risk Consumer Segments to Watch

Even with some good US data points:

• July inflation drops to 8.5%

• July added 528K jobs

The horizon is still cloudy with multiple risk factors.

For consumer lending, here are 7 segments worth special attention:

👉 Variable rate mortgage holders, especially subprime - were first to crack in the Great Financial Crisis.

👉 Home equity loan with a high Loan-To-Value ratio - the property value could quickly drop then the equity evaporates.

👉 Subprime auto loan holders - delinquency rates for this segment are steadily inching up.

👉 At-risk student loan holders - student loan payments are set to resume in September; 5 million borrowers are identified as at risk by CFPB.

👉 Those in previous forbearance programs - they’ve shown vulnerable financial positions; some are still struggling with delinquency.

👉 Cash balance on the decline - such info is available for full-service banks or can be sourced via open banking data.

👉 Those who used credit cards and personal loans to purchase cryptos - many lost their real-world money as the crypto market crashed into the “crypto winter”.

Any other segment you are watching?

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