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Consumers Making Fewer Late Payments

Tuesday, July 16, 2013 - 7:33 PM
From American Bankers Association:
Consumer delinquencies declined significantly in this year’s first quarter, falling in 11 out of 13 loan categories as consumers more carefully manage their finances, according to results from the American Bankers Association’s Consumer Credit Delinquency Bulletin. 

The composite ratio, which tracks delinquencies in eight closed-end installment loan categories, fell 29 basis points to 1.70 percent of all accounts in the first quarter, the lowest level since December 2004 and well below the 15-year average of 2.37 percent. The ABA report defines a delinquency as a late payment that is 30 days or more overdue.

[...] James Chessen, ABA’s chief economist, attributed the falling delinquencies to a steady improvement in the economy and improving financial health for consumers.

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The 11 categories are as follows (sorry, could not find details on the other two categories which make up the 13): 

Closed end loans (loans for a fixed amount of money with a fixed repayment period and regularly scheduled payments):
  • Personal loans
  • Direct auto loans
  • Indirect auto loans
  • Mobile home loans (delinquencies increased from 3.53% to 3.92%)
  • RV loans
  • Marine loans
  • Property improvement loans
  • Home equity loans
Open ended loans (loans with a fixed amount of available credit but a balance that fluctuates depending on usage such as a line of credit):
  • Bank cards
  • Home equity lines of credit (delinquencies increased from 1.85% to 1.91%)
  • Non-card revolving loans
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