WASHINGTON - (10/13/05) -- The average consumer is wracking upcredit card debt as never before, often using plastic to pay forhousehold expenses, monthly mortgages and even, business expenses,according to a new report issued Wednesday by the Center forResponsible Lending, a subsidiary of Self-Help CU. "Americanfamilies are facing financial hardship not experienced forgenerations, and we commissioned this survey to tell us preciselywhy they are turning to credit cards so often," said Tamara Draut,director of the Economic Opportunity Program for Demos, a co-authorof the report. Key findings from the report, called The PlasticSafety Net: The Reality Behind Credit Card Debt in America, are:the average credit card debt of low- and middle-income householdshas risen to $8,650; 70% of low and middle-income households usetheir credit cards as a safety net to pay basic living expenses,medical expenses or home repairs; 20% of homeowners paid off somecredit card debt by refinancing their mortgage, reducing the equitythey own in their homes, but still had a credit card debt over$14,000. The study shows that credit card debt in America hastripled since 1989, and increased by 31% in just the last fiveyears, to more than $800 billion. Since 1989, the study noted,consumer bankruptcies have also tripled in number from 616,000 to1.8 million a year. Release of the report comes five days beforethe effectiveness of the new bankruptcy law which will make itharder for consumers to erase all of their debts throughbankruptcy.
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Synovus Financial demonstrated at an industry conference how it is using Microsoft's Copilot to help its staff address customers' concerns.
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The U.S. arm of Spanish banking giant Santander has hired Swati Bhatia to oversee retail banking and its digital transformation efforts. Bhatia joins at "an inflection point" for the company, which aims to be "a digital bank with branches," CEO Tim Wennes said.
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Mariya Rosberg is named Americas head of banking and financial services at Marsh McLennan's Oliver Wyman unit; startup ZayZoon raised $15 million in a new funding round; and more in the weekly banking news roundup.
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Last year, the Raleigh, N.C.-based Integrated called off a deal to sell itself to MVB Financial after bank stocks took a hit in the aftermath of the regional bank failures. Capital hopes to expand its government-guaranteed lending with the transaction.
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Once a prominent figure spurring financial institutions to engage in cryptocurrency, Bankman-Fried's downslide began with the collapse of the digital asset exchange FTX in late 2022 and hit rock bottom with his sentencing to 25 years in prison.
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But the 30-year fixed rate mortgage is still near 7%, and that remains the overhang on the housing market, Freddie Mac said.
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