October sees consumer credit jump despite less credit card debt

By Marvin Milner on Dec 8th, 2010

Thanks to a 6.8 percent increase at an annual rate in nonrevolving credit - credit lines of fixed amounts such as auto loans and mortgages - consumer credit climbed 1.7 percent in October following more modest gains the month before, according to the latest statistics from the Federal Reserve Board. Meanwhile, the national total of revolving credit, which is made up primarily of credit card debt, fell 8.4 percent, marking the 26th consecutive month it has declined.

The total amount of credit card debt consumers held at the end of October dropped to $800.5 billion, down from $806.1 billion at September's end, the report said. Meanwhile, nonrevolving credit increased to nearly $1.6 trillion, up from just below $1.59 trillion in the previous period.

Some financial experts say that consumer credit has been impacted by the number of write offs lenders have had to make in recent months, forcing a number of consumers out of the borrowing system entirely.

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