November 19, 2020

Federal Reserve: New York Fed Releases Report About Credit Access and Debt Payment for Low-Income Americans

The Federal Reserve Bank of New York today released a report on the effects COVID-19 has had on low-income Americans’ ability to access credit and pay down debt. 

The report, “State of Low-Income America: Credit Access & Debt Payment,” uses data from the New York Fed’s Consumer Credit Panel, which is based on Equifax credit data. The data is also the source for the Bank’s national Quarterly Report on Household Debt and Credit. This data is complemented with income information from the U.S. Census Bureau’s American Community Survey. 

Lower income communities and communities of color have been disproportionately affected by illness and death due to the pandemic and by job loss in the resulting recession. The CARES Act tried to support consumers through large fiscal transfers to households such as stimulus payments and enhanced unemployment insurance; moratoria on mortgage and student loan debt repayments; and a temporary pause of evictions of some renters.  However, not all consumers have been covered by these debt relief programs; renters are particularly at risk, as direct fiscal transfers such as stimulus payments and enhanced unemployment insurance end.

Some key takeaways from the report include:

This post was originally published here.