In the first quarter of 2013, credit card delinquency rates are down by 18.8% from the final quarter of 2012.The number of people who are 90 days or more past due on their credit card payments dropped from 0.85% at the end of 2012 to 0.69%.
That’s according to data from TransUnion, one of the major credit reporting bureaus. They track and analyze credit use each quarter, reporting on the state of credit cards, mortgages and car loans in the U.S.
The decrease in delinquencies is typical of the post-holiday period. In the six years since the recession started in 2007, credit card delinquencies have fallen five times in the first quarter of the year.
This is partly due to folks putting tax refunds toward credit card balances, and partly because people tend to make an effort to pay off leftover holiday shopping debt.
TransUnion keeps track of delinquencies state-by-state, as well as by selected metropolitan areas. The cities with the biggest drops in late payments during the first quarter of 2013 were:
- Seattle (28.1%)
- Denver (26.9%)
- Salt Lake City (22.6%)
Looking at year-to-year data, 65% of the metropolitan areas tracked by TransUnion had declines in their credit card delinquency rates from the beginning of 2012 to the start of 2013.
Not all areas had fewer late payments, however. Twelve states had increases in year-to-year delinquency rates, with Massachusetts and North Dakota at the top of the list.
Forecast: A few more late payments
TransUnion expects credit card delinquencies to rise by about 0.71% during the second quarter of 2013, as seasonal factors such as weather, employment and disposable income shift. This increase is slight, but all signs point to increased economic recovery and a continued decline in the rate of late payments.