WASHINGTON - August 11, 2008 - The Federal Reserve is reporting that more banks are tightening lending standards on home mortgages, consumer, and business loans as a deepening credit crisis exerts a heavier toll on the economy.
The Fed said today that the percentage of banks reporting tighter lending standards rose across various loan types in its July survey compared to levels in April. Back then, the central bank had found the percentage of banks reporting tighter lending standards was already near historic highs.
The Fed says its new survey, conducted in early July, found that about 75% of the banks surveyed indicated they had tightened their lending standards for prime mortgages. That's up from about 60% in the previous survey.