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Lifestyle & Budget

Late Credit-Card Payments Fall to Lowest Level in 11 Years

Credit Cards FBN

The number of consumers failing to pay their credit-card bills on time fell to the lowest level in 11 years during the second quarter, as people continued to save more and borrowed less.

Bank card delinquencies dropped below 3% of accounts for the first time since 2001, falling about 15 points to 2.93% of all accounts and well below the 15-year average of 3.91%, according to a report by the American Bankers Association.

The ABA report defines a delinquency as a late payment that is at least 30 days overdue.

“Economic uncertainty has made consumers hesitant to take on new debt, and building a stronger financial base has become a priority,” ABA’s chief economist, James Chessen, said.

While the numbers are encouraging, they didn’t reflect the kind of comprehensive improvement across categories seen in the first quarter, and Chessen said that’s due to a lack of broad-based economic improvement, which gives consumers pause about the future.

“Slow job growth and continued uncertainty means many consumers will face challenges managing their debt going forward,” he said.  

At the same time, delinquencies across all three categories of home-related loans increased in the latest quarter and Chessen said the U.S. is still “many quarters away from seeing improvement filter through to reduce home-related delinquencies.”

Follow Jennifer Booton on Twitter at @Jbooton

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Loan Type Graph Rate +/- Last Week
30 Y Fixed Graph 3.88% up 3.84%  
15 Y Fixed Graph 2.87% -- 2.87%  
30 Y Fixed Jumbo Graph 4.19% up 4.14%  
5/1 ARM Graph 3.08% up 3.05%  
5/1 Jumbo ARM Graph 3.39% dw 3.57%  
Loan Type Graph Rate +/- Last Week
$30K HELOC Graph 4.60% up 4.44%  
$50K HELOC Graph 4.02% dw 4.04%  
$30K Loan Graph 4.50% dw 4.55%  
$50K Loan Graph 4.10% dw 4.16%  
$75K Loan Graph 4.10% dw 4.16%  
Loan Type Graph Rate +/- Last Week
36 M New Graph 3.09% -- 3.09%  
36 M Used Graph 3.31% -- 3.31%  
48 M New Graph 3.17% up 3.16%  
48 M Used Graph 2.86% up 2.85%  
60 M New Graph 3.11% up 3.10%  
Loan Type Graph Yield +/- Last Week
6 month Graph 0.37% -- 0.37%  
1 yr Graph 0.61% up 0.61%  
5 yr Graph 1.46% -- 1.46%