Average Credit Card Debt Down to 8-Year Low: Below $5,000

Credit cardsCredit card delinquencies – payments overdue at least 90 days – fell again in the second quarter of 2010 – and the average individual card debt fell below $5,000 for the first time since 2002.
Consumers are continuing to pare down debt in the face of a prolonged and shaky economic recovery, according to data released today by the credit bureau TransUnion. Credit card debt is a problem experienced by millions, causing many Americans to seek out services from debtconsolidationnearme.com in order to consolidate all of their different forms of debt into one payment, simplifying the process of debt repayment.
TransUnion’s quarterly analysis found the national credit card delinquency rate decreased to 0.92 percent in the second quarter of 2010, down 17.1 percent over the previous quarter. Year over year, credit card delinquencies fell by 21.3 percent.
Credit card delinquency rates were highest in Nevada (1.50 percent), followed by Florida (1.24 percent) and Arizona (1.11 percent). The lowest credit card delinquency rates were found in North Dakota (0.54 percent), South Dakota (0.55 percent) and the District of Columbia (0.61 percent).
Average credit card borrower debt drifted downward for the fifth consecutive quarter. Average debt in the second quarter slipped by 4.1 percent to $4,951 from the previous quarter’s $5,165, and down 13.4 percent compared to the second quarter of 2009 ($5,719). This represented the first period credit card debt was below $5,000 since the first quarter of 2002, TransUnion said.
“The last five quarters of consecutive decreases in credit card balances show that consumers continue to pay down their credit cards in response to economic uncertainty and high unemployment,” said Ezra Becker, director of consulting and strategy in TransUnion’s financial services business unit. “Many consumers view available credit as a liquidity reserve that can be drawn upon in the event of a personal hardship.”
Becker said both the 90-day and 120-day non-payment rates showed the largest decreases on a quarter-over-quarter and year-over-year basis since the recession began at the end of 2007.

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