Consumers are paying their bills, delinquencies below 15-year average

People are paying their bills on time as bank card delinquencies fell in the second quarter.

That’s according to the American Bankers Association’s Consumer Credit Delinquency Bulletin.

8 of the 11 categories tracked by the ABA showed improvement or held steady, there were two that edged up just 1 basis point.

One area that rose was the composite ratio of installment loans. That reading rose by 3 basis points, driven mainly by a 12-basis point rise in home equity loan delinquencies.

The ABA report defines a delinquency as a late payment that is 30 days or more overdue.

“As the economy keeps humming along, delinquencies have stayed at very low levels,” said James Chessen, ABA’s chief economist. “Overall, consumer financial health has been excellent. Jobs are plentiful, wages are rising and savings rates have held steady at elevated levels, which paints a vivid picture conducive to low delinquencies.  While delinquencies have held steady, the holiday season is fast approaching and a watchful eye on budgets is the key to successfully managing debt obligations.”

Delinquencies in bank cards decreased 13 basis point to 2.93 percent of accounts. That remains below their 15-year average of 3.55 percent.

“Consumers are spending in line with their income and managing their credit cards very well,” Chessen said. “This vigilance has kept credit card debt low relative to income for six years, and positions consumers to continue supporting our growing economy.”

Delinquencies rose in two home-related categories and fell in another.

Home equity loan delinquencies rose as did home equity line of credit delinquencies. Property improvement loan delinquencies fell.

Late payments on direct auto loans also fell.