Fewer Defaults: Could the Worst Be Over?
The number of consumer loans that are going bad is leveling off, reports Bank of America, Wells Fargo and other large banks, signaling that the worst could be over.

Bankers reported that credit quality is stabilizing with lending losses expected to peak this year.

But analysts warned that any new hit to the economy could reverse the trend with all aspects of the recovery dependent on an improving employment picture.

“In the second half of the year, it will be more and more important for the overall economy to improve at a faster clip,” says Anthony Polini, a banking analyst at Raymond James.

This makes sense. Many of the less than credit worthy people have already defaulted. They have already been foreclosed on, they no longer have the opportunity to be delinquent on their mortgage loans.

Now that banks are no longer giving loans out to anyone who can breathe, the quality of the new mortgage borrowers is up.

It looks like there might actually be light at the end of the tunnel for the foreclosure market after all.