Experts believe it is unlikely to get any easier to obtain credit in the near future as increasing numbers of Americans default on existing credit card debts and consumer confidence is low.

American households are experiencing rising expenses as gas and food prices soar and wages stagnate, according to economist David Smith.

As increasing numbers of banks experience struggling households defaulting on large debts, they are tightening up their credit standards and the mainstay of the economy, the "borrow-spend dynamic" is in danger of disintegrating, he explained.

In comments reported by Blogging Stocks, Mr Smith stated: "Lower interest rates are unlikely to persuade households up to their eyeballs in debt to borrow and spend liberally, nor will they inspire shell-shocked banks to liberalize their credit standards."

In this climate, short-term solutions to cash flow problems, such as pay day loans could sustain low-income households through the tougher times.

Credit card debt in the US has seen a vast increase, with lenders writing off 33 per cent more in debt this year than in 2006.

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