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ST. LOUIS NEWS TODAY - Sunday, July 13, 2008
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Two Out of Three Consumers Say Mortgages and HELOCs Harder to Obtain
ST. LOUIS, MO, (PRNewswire), July 13, 2008 - The credit crunch is impacting not only consumers' ability to get credit, and how they use it, but also -- for some -- their mindset towards financial institutions, according to a nationwide survey conducted by Deloitte's financial services industry group.
According to those who have attempted to secure several types of credit and mortgage products over the past year, a majority found it to be more difficult. Deloitte's survey revealed:
- Of those who applied for a home mortgage, 67 percent found it more difficult; for a home equity line of credit (HELOC), that number was 65 percent.
- Personal loan applicants weren't much better off, with 62 percent finding it harder to get credit.
- More than three-quarters (76 percent) of those who applied for small business financing found it more difficult, compared with one year ago.
"Given that more than 90 percent of those surveyed believe the U.S. economy is experiencing little or negative growth, it is not surprising that consumers are restricting spending and delaying large purchases," said Jim Reichbach, Deloitte's Financial Services industry leader. "Quite simply, they do not want to extend themselves further. At the same time, banks have limited access to credit for some consumers, while more aggressively targeting the better credit-quality consumer."
Despite the negative headlines that financial institutions have been receiving in the United States, the survey found that two out of three consumers (67 percent) held the same perception of their primary financial institution as they did before the crunch. For the 5 percent who see their relationship as more positive, they cited enhanced customer service and an increased number of products and incentives to choose from as top reasons.
On the opposite side of the coin, 15 percent of survey respondents have come to view their banking relationship more negatively over the past year. For those who have changed banks (5 percent overall), the key reason specified was a rise in costs and fees.
"As past surveys have shown, financial institutions have not done a good job at engendering customer loyalty and, given the events of the past year, need to re-establish consumer trust," said Adam Schneider, a principal with Deloitte Consulting LLP, who works with banks and other financial institutions. "Business models are changing and some of the best-run banks are taking steps to strengthen their credit and mortgage businesses. They recognize that when balance sheets are rebuilt they will have to restart lending, but are likely to be more conservative and focused on the most credit-worthy."
New Missouri Telecommunications Deregulation Bill May Decrease Consumer Taxes and Usage Fees
JEFFERSON CITY, MO, (SLFP.com), July 13, 2008 - Gov. Matt Blunt has signed legislation to protect innovative new technology that is reducing costs and creating more competitive choices for consumers from unnecessary regulation. The bill is the most extensive deregulation of voice over Internet protocol (VOIP) service in the nation.
"Missouri companies and entrepreneurs must have the freedom and flexibility to create new and innovative services to best serve their customers," Gov. Blunt said. "We are at the forefront of a technological revolution when it comes to how we use the Internet, phones and other information technology to communicate. This legislation tears down obstacles to innovation, allows Missouri companies to develop new technologies in a more competitive fashion, and preserves oversight authority where needed."
House Bill 1779, sponsored by Rep. Ed Emery, enjoyed bi-partisan support in both the House and Senate. Among other things, it affects a broad deregulation of VOIP in Missouri. Regulatory changes in the bill were designed to promote competition while preserving the Public Service Commission's (PSC) authority. The bill also updates current law to include new technologies and competitive situations.
As VOIP and related technology is continuing to evolve and develop a market presence, this legislation will allow it to grow more effectively and efficiently.
In a release, the Institute for Policy Innovation (IPI) commended Gov. Matt Blunt's decision to sign the telecommunications deregulation legislation recently passed by the Missouri Legislature.
As a result of this action, the Show Me state will allow Voice over IP (VoIP) technology to develop and flourish statewide without regulatory interference.
"Missouri has shown bold leadership -- not by being the first state to attempt to tax and regulate an exciting new technology, but rather by reining in the regulators," said IPI President Tom Giovanetti.
"These sorts of technology innovations are the prime drivers of economic growth because they increase productivity of businesses and enterprises large and small," said Giovanetti.
With the measure, Missouri has avoided taxing the risk-taking companies that are creating jobs by investing and building out infrastructure in the state.
"We ought to be praising and rewarding the facilities-based providers who are doing the favor of building out a critical broadband infrastructure using their own risk capital," said Bartlett Cleland, Director of the IPI Center for Technology Freedom.
With deregulation, Missouri consumers will enjoy a decrease in the taxes and fees they otherwise may have been required to pay. The only industries that bear a heavier tax burden are cigarettes and alcohol.
"Clearly, Missouri has shown a desire to lead in the communications market as well as in state leadership by relaxing regulations and therefore encouraging economic advancement, job creation and income growth," said Cleland.
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