Credit card delinquencies, based on total dollars owed, soared during the summer months to its highest level in five years. The American Bankers Association says the number one factor in rising consumer credit delinquencies is job losses. According to the ABA’s “Consumer Credit Delinquency Bulletin,” delinquencies based on total dollars outstanding for the July, August and September period (3Q/08) were 4.74%, compared to 4.32% in the second quarter and 4.00% for the same months in 2007. Based on the number of accounts past-due, the figures were 4.20% for 3Q/08, 4.54% for 2Q/08, and 4.18% one-year ago. The ABA says that it anticipates delinquency rates will continue to rise in the fourth quarter. The ABA also noted that some people are relying on credit cards to meet daily expenses like food and gas, but many are being careful not to add new debt.
3Q CREDIT CARD DELINQUENCY HISTORY (based on total dollars outstanding) 1980: 3.40% 1985: 3.15% 1990: 4.01% 1995: 4.21% 2000: 3.93% 2005: 3.74% 2006: 3.50% 2007: 4.00% 2008: 4.74% Source: ABA Delinquency Bulletin