Credit Card Balances & Delinquencies Rise in Third Quarter

Credit Card Balances & Delinquencies Rise in Third Quarter

The average credit card debt per American borrower increased to $4,996, up 4.9 percent in the third quarter from the year before, according to a report released today from TransUnion.

Late payments at least 90 days overdue also slightly increased to 0.75 percent during the July-September period, up from 0.71 percent in the third quarter of 2011. The late payment rate was 0.63 percent in the second quarter of 2012. The late payment rate is still close to historically low levels.

TransUnion reported 36 states had increases in their credit card delinquency rates from a year ago while nine other states and the District of Columbia posted decreases. There were no changes in five states.

Average credit card debt is likely to climb again in the fourth quarter as consumers use credit cards to pay for holiday shopping.

The increase in credit card debt may reinforce the latest research from the Federal Reserve that shows bankers have eased up slightly on lending standards and demand is increasing for credit cards. During the past three months, 17 percent of all banks and 26 percent of large banks reported a moderately stronger demand for credit card loans, according to the Federal Reserve Senior Loan Officer Survey. In addition, nearly 17 percent of large banks eased the credit standards for applying for a credit card.