Credit Card Defaults and Delinquencies Fall For Second Straight Month

Last month I wrote about how the default rates of the top credit card issuers was, generally, dropping.  Here’s the article if you want to review.  Now, for the second straight month the default rates have dropped for the top credit card issuers.  This is good news as it signals a trend in falling default and non-default delinquencies (accounts that are past due but not terminally delinquent).

Bank of America, American Express, Citibank, Capital One, Discover and Chase are the top six issuers and all reported better delinquency performance in March 2011.  In fact, the rate of delinquencies fell to a 3 year low.  This means the holiday shopping season didn’t result in the same unmanageable amount of credit card debt as in previous years.

Bank of America had an amazing reduction in the percentage of their balance currently delinquent.  In February it was 8.84% of balances.  In March it was 4.82%, a reduction of over 4 percentage points.

American Express maintained the top (or bottom) position by having 1.8% of balances currently 30 days past due or worse.  This is a slight reduction in their percentage from February, 1.8%.  American Express targets a more sophisticated consumer, which explains their very low delinquency rates.

John Ulzheimer is the President of Consumer Education at SmartCredit.com, the credit blogger for Mint.com, and a Contributor for the National Foundation for Credit Counseling.  He is an expert on credit reporting, credit scoring and identity theft. Formerly of FICO, Equifax and Credit.com, John is the only recognized credit expert who actually comes from the credit industry.  Follow him on Twitter here.

Categorised in: Credit Cards, Credit Report, Credit Score, Debt, Money & Identity

This post was written by John Ulzheimer