Credit unions which are being approached for credit from members who have a mortgage default in their history might take some comfort from a new study from Transunion, one of the three major credit reporting firms in the U.S.
The study found that in cases where a borrower defaulted only on their mortgage and not on other loans such as credit card, auto or others, the borrower turned out to have an overall better credit score and attitude
The study did not find any strong evidence supporting the widely accepted "excess liquidity theory," which suggests consumers who stopped paying their mortgage loans during the recent recession had an increased cash flow in the short term, and therefore could repay other debts.
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