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As charge offs peak, some may consider debt consolidation
11/30/2009
A recent report from Bloomberg news notes that Bank of America is expecting write offs to peak during the fourth quarter.
The prediction comes with the caveat that the unemployment rate does not rise above forecasts. Currently, the unemployment rate sits at 10.2 percent, with many analysts predicting it will remain above 10 percent in the near future.
Ric Struthers, global card services president for the bank, told Bloomberg that many people expect credit card write-offs to hit their highs during the third and fourth quarters of this year.
"That's a realistic view," Struthers said.
The Bloomberg report noted that Bank of America posted credit card defaults that amounted to $14.3 billion through September of this year. That marks a 76 percent increase over the same time period in 2008.
As it turns out, Bank of America may not be alone when it comes to credit card defaults. Moody's Investor Services recently reported that though defaults saw a recent drop, delinquencies continue to climb, meaning more charge offs could come in the future.
And though that does not bode well for card companies, it also means that there are still consumers who need help with loans. One option consumers may consider is getting debt consolidation. Debt consolidation allows consumers the ability to find lower interest rates for loans, which could make repayment easier.
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