New Hope on the Credit Card Front
[Jul 19, 2007.]
While the housing market appears to be sluggish and the overall economy may appear to be a mixed blessing, the outlook appears to be bright for credit card companies and their cardholders.
The American Bankers Association reports that the rate of credit card delinquencies is surprisingly good, all things considered. The actual delinquency rate in the first quarter of the year, based on the total amount of money outstanding, is at a 13-year low.
In addition, delinquencies have been decreasing for 3 quarters straight, according to a publication from the American Bankers Association entitled "Consumer Credit Delinquency Bulletin." For the first quarter of 2007, delinquencies based on total amount of money outstanding was 3.46%, as opposed to 3.54% in the fourth quarter and 3.44% for the first quarter of 2006. As far as accounts past-due are concerned, the rate was 4.41% for the first quarter of 2007, 4.56% for the fourth quarter of 2006, and 4.4% last year at this time.
The American Bankers Association considers the improving state of credit card late payments to be astounding, given the problems inherent in the economy as of late. Such troubles as slow job growth, declining home prices, and sluggish economic growth could have wreaked havoc in the households of individual consumers.
Yet, credit card customers are, by and large, paying their bills on time. In fact, there have been statistics to show that people are more likely to pay on their credit card accounts than on their mortgages. It appears that consumers simply don't want to contend with the late fees and additional interest costs associated with paying credit card bills late.
Obviously, the delinquency rates are good news for both consumers and credit card issuers alike. The rates may also be an indication that Americans are acting more responsibly, as far as credit is concerned.
Julie Ann Amos
July 19th 2007
Recent Housing News
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[March 15th, 2010]
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