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Credit data suggests people making progress on debt consolidation
10/05/2010
Credit card delinquency figures have continued to improve in recent months as more people pay off debt and get their personal finances back in order.
According to the latest Charge Card Index figures from Fitch Ratings, credit card delinquency rates have improved for eight consecutive months, although charge offs remain above 10 percent.
Despite the lingering hike in the charge-off category, Fitch added that 3.27 percent of credit accounts were 60 days or more overdue in August, representing a decline of 49 basis points. Another 4.34 percent of accounts were reported to be 30 days or more past due, which marks an improvement of 66 basis points for August.
Delinquencies typically apply to payments that are 30 or 60 days overdue, while charge offs occur after a lender has given up on collecting a debt. Consumers are still liable for the debt, however, and will feel its effects on their credit score for seven years.
"Absent any meaningful improvement to the employment situation, charge offs will remain high," said Fitch Managing Director Michael Dean.
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