At Least People Can’t Default on Mortgages They Didn’t Get

The credit crunch is getting personal. In a Deloitte & Touche survey fielded last month, 67 percent of respondents who’d applied for a mortgage said it has become more difficult in the past year to get one. Among those who applied for a home-equity line of credit (known by the jaunty acronym HELOC), 65 percent said the same. Perhaps most alarming for the economy, so did 76 percent of those who applied for small-business financing.

Notwithstanding the trend evident in the numbers above, a majority of Deloitte’s respondents (59 percent) said they haven’t found it any harder over the past year to get credits cards. Of course, many of them likely haven’t been trying, given another trend noted in the survey: 40 percent of respondents said they’re spending less via their credit cards than they did in the past.

As for those spending more on their credit cards, it’s not that they’re splurging on discretionary self-indulgences. Rather, many of those spending more on their cards “are often using them for essential purchases,” such as gas (cited by 70 percent), food/groceries (67 percent), healthcare (24 percent) and utilities (14 percent). Some of this may be simply a matter of convenience. But we can surmise that some of these consumers find it necessary to give themselves a high-interest loan via their credit cards in order to cover their normal expenses. That can’t be a good sign.

The study has one bit of information that will add to the widespread puzzlement about why the mortgage crisis is threatening to destroy civilization as we know it: Among people who have a mortgage, 91 percent “have made their mortgage payments either early or on time over the past year.” Evidently the other 9 percent have a lot to answer for.