We have written a lot about the economic strain many Americans continue to face as the pandemic (hopefully!) winds down. We recently noted how debt postponed during the worst stretches of lockdown will soon come due, leading to a spike in foreclosures and auto repossessions. Things are about to be unbelievably difficult for a lot of people, and the compliance industry must help to make these experiences as painless as possible by following federal regulations and industry best practices.
This is only one side of the coin, however. For some white-collar, professional workers who were able to maintain their jobs remotely, the pandemic has actually proven to be something of a financial boon.
No, we are not talking about the wealthy or super wealthy here, but a segment of upper-middle class professionals who had little-to-no change to their income, much less their employment status. They actually found themselves saving money by not going out, by eating in, and by curtailing their travel--all necessities during the pandemic.
By saving nearly a year of their disposable income, these people, though inconvenienced and endangered by COVID-19, have actually come out of the pandemic in better financial health than they entered it. Yes, many of them earn too much money to receive a stimulus check, but that’s one of those good types of problems to have, particularly in this economy.
The Money is Saved, People are Just Waiting For Homeostasis to Spend It
A rebounding economy is likely to propel this group of the financially comfortable into some of the larger purchases they delayed during the pandemic. To be clear, they did not necessarily delay larger purchases because they could not afford them but rather out of an abundance of caution, a respect for the unknown, and a suspicion that things could get worse.
But, by and large, things haven’t gotten worse and now, with all signs pointing towards a healthier economy and in-person retailers back open for business, we should prepare for a buying spree.
Money has been building up in their accounts, but they have saved it for a rainy day; with clear weather forecasts ahead, we believe, these savings will soon become splurges. In the same way that an entire class of Americans is facing delayed debt, another is staring at delayed purchases--all the things they’ve wanted to buy but were just waiting until it felt right. This can range from something as small as a new phone to something as big as a new house, and everything else in between.
All of these new purchases, of course, will mean more credit and more consumer reporting: More credit cards, more auto loans, more home loans and refinances, new insurance plans, and even new utilities (the pandemic taught a lot of people that they need to upgrade their WiFi).
In a recession, it is easy to assume that spending (and lending) will decrease. While that is normally true, this recession has been remarkably stratified, and we fully expect a large swatch of the population to come out of it with the power of commerce flowing through their veins.
Virtual and Physical OnSite Inspections for Consumer Reporting
A lot of that spending requires consumer reporting--it’s how lenders determine lines of credit, how insurers determine policy rates, and how sellers determine payment plans. For businesses looking to capitalize on this segmented spending spree, it is imperative that they meet federal requirements governing the release of credit reports.
Each of the three major credit reporting bureaus observes strict guidelines governing the purpose, conditions, and security of credit reporting. TrendSource OnSite Inspections offers and Virtual and Physical Inspections for Consumer Reporting, helping reporting bureaus and consumer reporting agencies document compliance among businesses accessing their reports.
As people come into the pandemic spending spree, they will be looking at big ticket items that require financing. Financing requires credit, and credit requires consumer reporting, and TrendSource OSI’s Physical OnSite Inspections helps businesses access consumer reports by documenting their compliance with federal regulations.
In order to get the economy back on track, people need to start spending again. Access to credit goes a long way in helping, and TrendSource OnSite Inspections is a small part of a much bigger system that helps keep credit and consumer reporting practices fair, secure, and accurate.