Between January 2009 and June 2011, through the depths of the Great Recession and the initial sluggish recovery, the percentage of U.S. households that had ever used high-cost nonbank credit rose from 11.8 to 14.2 percent. This includes payday loans, pawnshop loans, rent-to-own agreements, and refund anticipation loans. The demographic composition of nonbank credit users also shifted, toward population segments normally considered economically advantaged: older, nonminority, more educated, married couples, and those with incomes above $50,000. Reflecting the broadly-based financial stress among households nationally, 45 percent of nonbank credit users needed such funds for basic living expenses versus unexpected needs.
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