Credit Card Mountain of Debt Update

5State_Bankcard6While most people write about the real estate crisis and the issues associated with loan mods, short sales and foreclosures, many have overlooked one thing. What’s that giant plastic mountain of debt behind the curtain – yes, your credit card. We got some juicy info from TransUnion about that plastic mountain of debt that for many people coincides with mortgage problems. After all, many people have been paying their mortgages by using their credit cards.

Surprisingly, the national credit card delinquency rate (the ratio of bankcard borrowers 90 days or more delinquent on one or more of their credit cards) fell to 1.17 percent in the second quarter of 2009, down 11.36 percent over the previous quarter. We Californians have a juicy 1.45 percent delinquency rate. Credit card delinquency can often be tied to seasonal factors but recent unemployment rate data (dropping to 9.4 percent in July) gives some credence to the idea that we may have hit the bottom of the recession.

How heavy is your wallet? Well, the average credit card borrower debt sits at $5,719 from the previous quarter’s $5,776, but zoomed up 1.74 percent compared to the second quarter of 2008 ($5,621).

Some people have resorted to declaring bankruptcy when there credit card debt gets too deep, while other use credit card reduction companies (yes, there are some legit ones that we know of that negotiate with the credit card companies to get a “bulk rate” in reducing the users credit card debt) but it’s a good idea to watch not only the banks numbers but the credit card numbers as well.

Advertisements

Leave a comment

Filed under Credit Cards

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s