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Consumers, credit card issuers switch roles
By Angela Hawke on Aug 29th, 2010
According to the latest report from Moody's, credit card delinquencies continued to fall in July as Americans gain a better grasp on their debt. This is the ninth consecutive month that rates have dropped, the Associated Press reports. The rate was at 4.93 percent in July, ending 20 consecutive months of delinquency rates above 5 percent in the U.S.
Bloggingstocks, a financial news site, says that the tables have turned and there has been a role reversal between consumers and credit card companies. Author Kevin Kersten says that the credit card industry was at just as big of a risk of collapsing when the housing market crashed in 2008. However, Americans have smartened up and now realize that while credit can be used to "buy now, pay later," it should be reserved for emergencies.
Debt can result in credit score damage, making it important for consumers to pay off their credit card bills in a timely manner. Those who are struggling to make payments could consider consolidation to lower monthly payments. Combining debt and taking out a loan with a lower interest rate can reduce expenses for borrowers.
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