More Americans Catching Up on Credit Card Payments

Published

July 12, 2011

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The number of charged off and delinquent credit card accounts declined for all major lenders in the U.S. once again in June, with both factors dropping to lows not seen in several years, according to the latest monthly statistics from Fitch Ratings. The number of charged off accounts – those 90 days or more behind that are considered irretrievable by lenders – slipped to 7.29 percent of all balances, the lowest rate seen since early 2008. This figure also declined 35 percent from the same month last year.

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In addition, delinquent accounts – those that had gone 60 days or more without payment – fell to just 2.57 percent, the lowest figure since August 2007, and the 17th straight month of decline, the report said. Similarly, early-stage delinquencies – balances 30 days behind – fell to 3.33 percent.

“Credit card collateral saw positive across the board gains for the fourth time in six months,” said Cynthia Ullrich, senior director for Fitch Ratings. “Future credit card performance looks promising, with Fitch anticipating smooth sailing during the second half of this year.”

Many financial experts have said that while some Americans have indeed made strides in making more conscientious bill payments, the large majority of declines in charge offs and delinquency comes from previous defaults locking severely troubled borrowers out of the credit system entirely.

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