Falling oil prices hurting Albertans’ credit scores; TransUnion

The impact from the plunge in oil prices has been on the mind of Calgarians for a while, but a new study suggests this may only be the beginning — at least when it comes to the impact on personal credit.

A study from credit monitors TransUnion claims oil-rich regions such as Alberta and Saskatchewan are poised for a sharp increase in credit and loan delinquencies.

Jason Wang, study author, says if lenders do not take proactive measures, there could as much as a 60% rise here in Alberta and double-digit delinquency rates in Saskatchewan.

An easy way to tell if there is a problem is to look at credit card payments.

The study looked at the payment patterns in Fort McMurray which show the number of residents who pay no more than twice the minimum amount due has increased 10 per cent.

A historical precedent was set back in 2008 when oil dropped to a little more than $30/barrel and delinquency rates jumped 60 per cent over the following year.

It took two full years for those rates to recover.

TransUnion has made a similar prediction this round as well and says the problem will persist through 2016 before a moderate recovery in 2017.

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