The ratio of bankcard borrowers 90 days or more delinquent on one or more of their credit cards increased to 1.21% in the fourth quarter of 2009, up from 1.1% in the previous quarter, according to data from credit-tracking firm TransUnion. The delinquency rate for the fourth quarter of 2008 also was 1.21%.
The report is part of an ongoing series of quarterly consumer lending sector analyses focusing on credit card, auto loan and mortgage data. Information comes from about 27 million anonymous, randomly sampled individual credit files, which represent 10% of credit-active U.S. consumers.
The highest credit card delinquency rate was in Nevada, at 2%, followed by Florida, at 1.75%, and Arizona, at 1.62%. Real estate troubles have contributed to consumers’ high credit card delinquency rates in those states, Ezra Becker, director of consulting and strategy in TransUnion’s financial services business unit, tells PaymentsSource
The lowest delinquency rates were in Alaska, at 0.67%; North Dakota, 0.69%; and South Dakota, 0.74%. Mississippi had the largest quarter-over-quarter increase–21.1%. However, seven states saw a drop in their credit card delinquency rates: Kentucky, Minnesota, Colorado, Nebraska, Idaho, Alaska and Oregon
Average credit card borrower debt in the fourth quarter dropped 3.2%, to $5,434 from the $5,612 the previous quarter, and down 5.2% from $5,729 during the fourth quarter of 2008. The highest state average credit card debt remains in Alaska at $7,328, followed by Tennessee at $6,823 and Alabama at $6,332. The lowest average credit card debt was in Iowa, at $4,138, followed by North Dakota at $4,318 and West Virginia at $4,448.
No states reported an increase in debt. The steepest decrease in debt from the previous quarter occurred in Nevada, down 6.23%; Alaska, down 4.8%; and Rhode Island, down 4.4%.
Consumers making strong efforts to pay down balances when unemployment is a possibility attributed to the drop in card debt, Becker says. “[Consumers] want to keep a credit cushion available for hard times,” he says.
