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Troubling.
Unfortunate.
A challenge to overcome.
These are our initial reactions to a recent Center for Rural Pennsylvania report featured in The Express community newspaper that parts of our area have among the highest rates of home improvement loan denials.
Now we all should know that banks cannot take adverse risk when lending money.
There must be collateral.
There must be enough income to repay loans.
But the report is still troubling because it reflects, we believe, Clinton County's above averge poverty rate, which stands at 13.4% of the population.
The census puts Clinton County's median household income (2020) at $51,145 and per capita income (2020) at $26,656.
Not good, especially considering the record inflation of the past 18 months. Food. Insurance. Housing costs, etc., etc. etc.
The report, meanwhile, said age was one major predictor of one's likelihood of securing a home improvement loan. Sure it would.
"Increase in age increased one's chance of getting loan approval by 12 percent. Young people under age 25 or between ages 25 and 34 were less likely, in general, to get approved for home improvement loans, regardless of location. For the category of debt-to-income ratio, those who were in the 65 to 75 age category were affected the most compared to younger applicants," the report authored by Ying Yang, Ph.D., Claire Jantz, Ph.D., and Antonia Price, Shippensburg University, states.
"Geographically, the research team identified clusters of the highest denial rates in northeastern Pennsylvania (Pike, Monroe and Carbon Counties), outside of Erie (parts of Warren and Crawford counties), parts of Potter and Clinton counties in Northcentral Pennsylvania, and parts of Somerset and Bedford Counties in the south," the authors wrote.
"Credit history affected the middle-age groups the most, and (lack of) collateral was the top denial reason for younger applicants."
Their conclusion: Rural Pennsylvania residents are more likely to live in sub-quality housing, which could negatively affect their health, safety and access to other resources.
This research identified multiple factors that contribute to this problem, ranging from resident-level socioeconomic and financial characteristics to community-level economic well-being to municipal-level ordinance enforcement efforts.
"The research team recommends that policymakers take these factors into consideration to enact more efficient policies to provide a healthy living environment for Pennsylvania residents."
Our conclusion: Younger people need to be given more job and training opportunities to earn a living wage. And of course there are other factors such as learning to save money and not overspending. (Starts at home.)
You've heard it before: We must strengthen our efforts to steer more kids into vocational-technical trades and affordable college educations.
Those who struggle to make and build a living need a chance -- and must develop a strong work ethic -- to climb their way out of the low-income bracket.