The news has been talking about how bad credit loans have started to default and how it is starting to effect everyone. What started this whole fiasco is that bad credit loans became very popular and many were issued with variable rates. Bad credit loans banks were even starting to appear since it became so popular. People that did this either did not fully understand the meaning of variable or they had counted on a raise that never came. When the rates started to increase, more and more people had to foreclose on their house or deal with unpaid loans since they could no longer afford to make their bad credit loans payments.