Credit card delinquencies fall 11% in second quarter

08.26.09
By Timothy Jones

New figures suggest that Americans may still be struggling to pay off credit card debt but are getting better, as a report from TransUnion shows that the credit card delinquency rate in the second quarter of 2009 fell 11.36 percent.

Although the second quarter delinquency rate - 1.17 percent - is a 12.5 percent increase over the same period in 2008, the figures show that the American consumer is getting a better handle on their credit card debt over the year.

Americans also appear to be paying down credit card debt as the report finds that the average borrower debt fell a little less than 1 percent in the second quarter to $5,719.

Ezra Becker, director of consulting and strategy for TransUnion’s financial services group, says that although the numbers may be due to a seasonal adjustment, it is a positive sign for the economy and believes that job figures could help credit card delinquencies remain on a downward trend.

"If the unemployment numbers remain true to form over the next two quarters and the stock market continues to rise, we could see delinquencies begin to drop near the beginning of 2010," he said.

Moody's also released positive numbers about the nation's credit card situation this week with a report finding that credit card delinquencies and defaults had dropped in July.

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Americans appear to be getting a better handle on their money