More Americans got their credit card payments in on time this past quarter and lenders were more willing to give credit to individuals whose ratings are less than pristine, according to a new study.
The TransUnion Industry Insights Report, issued quarterly, sums up trends in the consumer lending industry, using data generated from the credit information of U.S based consumers.
The rate for people who were at least 90 days late on credit card payments dropped to 1.16% during the April-June quarter, the lowest it’s been in seven years. That’s a significant change compared to 1.27 % during the same time frame last year, and 1.37% in the first quarter of this year.
Banks are focused on offering credit to those with good or excellent credit as expected, yet the study showed that individuals with a Vantage credit score lower than 700, represented the biggest group of new credit cards issued.
Delinquencies hit all-time lows for everyone
The data suggests that consumers, regardless of age, have a handle on credit card usage, with delinquency rates dropping across all age groups – at a similar rate.
People between the ages of 40 and 60 are considered to be at their peak in terms of buying power, and traditionally carry more debt. In the second quarter that trend is clearly in play, with individuals in the 50+ age bracket charging more. On the other hand, the younger generations showed slight declines in their balances.
In recent quarters the study has found that younger consumers actually have lower debt levels, and this trend also continued this quarter.
State by State; City by City
All the states, except for Alaska, saw a decrease in credit card delinquencies between this quarter and the same one last year. Massachusetts, Wisconsin, Arizona and Illinois showed the biggest declines. When it comes to credit card debt, only 13 states showed declines.
Which ones? Boston (-18.19%), San Francisco (-17.98%) and Chicago (-14.05%) saw the largest declines in delinquencies.
In terms of how much debt consumers are carrying certain cities showed significant declines, including:
- Phoenix: down 2.59%
- Miami down 1.31%
- San Francisco down 1.11%
TransUnion is a credit and information management company that provides credit scores and reports. They offer services to 500 million consumers and 45,000 business.