Easier lending may take time

Two new U.S. government programs to kick-start loans for consumers will take time to kick in and do not help borrowers with bad credit, experts said.

The government moved Tuesday to lend $200 billion to investors to buy asset-backed securities based on student loans, auto loans and credit card debt. In addition, the government will buy $500 billion in mortgage backed securities from government-sponsored enterprises the Federal Home Loan Mortgage Corp. and the Federal National Mortgage Association.

However, it's not going to be like flipping a light switch, president of the Consumer Bankers Association Joe Belew told Thursday's New York Times. While anything that can lubricate the market is a good thing, he said, you're not going to see an avalanche of new loans.

New movement in credit markets will not help homeowners refinance if their home is worth less than their mortgages, nor is it likely to convince banks to overlook bad credit reports, rising in the economic slump, the Times reported.

At the end of the day, it still comes down not to just a rate discussion, but a discussion about qualifications as well, said Cameron Findlay, chief economist at LendingTree.

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