Welcome to TheCreditCruncher.com

The Credit Cruncher was conceived to help you to keep up to date with credit crunch and recession developments, it provides some helpful credit crunch advice and it addresses personal debt. The Credit Cruncher also seeks to explain how the credit crunch started and shed some light on the worldwide recession. Recently, we have begun to look at how BREXIT will affect the UK economy. Please feel free to leave comments where relevant.

4 Jul 2008

Will we all end up broke?

No as long as you are sensible about your money. Firstly the credit crunch will have it's most significant impact will be the sub-prime mortgagees - ie. those who have 100% mortgages with little hope of keeping up the payments.
The knock-on effects will effectively squeeze the whole credit industry making credit harder to obtain.
There are three main additional contributors to our current crisis:
1) static wages
2) rising costs for fuel and food
3) the acceptance of spending more than you earn as being 'normal'
There is not much that the individual can do about the first two, and although a slow-down in spending will have an even worse impact in the short-term, I believe we all need to make budgets and try to cut down on debts..

Inevitably, as with all financial crises, there will actually be some 'winners'... Those first time buyers with a decent deposit and a decent level of earnings will be able to take advantage of the repressed property market to buy cheaply especially where others may need to sell quickly. Those with healthy finances who can keep a decent level of earnings will not suffer any negative effects from the credit crunch.

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