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Delinquency rates in the fourth quarter of 2011 fell across all loan categories the trade group monitors, including credit cards, auto and home loans, the American Bankers Association reported on Thursday.
April 5
More consumers failed to pay down their home equity lines of credit in the first quarter of 2012, according to the American Bankers Association.
Delinquencies for the loans rose to 1.78% from 1.69% last quarter, even as consumers made fewer late payments across 10 other loan categories, the ABA reported on Tuesday.
"It will be many quarters before delinquencies on home equity loans get back to anything close to normal," said James Chessen, the ABA's chief economist, in a press release. He attributed the rise in delinquencies to continued problems in the housing market.
The ABA's composite ratio, which includes delinquency rates for eight closed-end installment loan categories, fell to 2.35% from 2.49% last quarter, the lowest rate since 2007 and below the 15-year average of 2.4%. The ABA defines delinquency as a late payment that is 30 days or more overdue. Delinquency rates are seasonally adjusted.
The latest report is in line with consumer behavior in recent months. Last quarter,
But Chessen warned that such declines won't continue indefinitely, especially in the current economic environment.
"We've moved back to historical norms now and further improvement could be hard to achieve. The economy has slowed recently and uncertainty remains high. This means banks will continue their prudent approach to extending new consumer credit as high unemployment levels are still creating loan losses," he said.
"However, continued growth in jobs, moderating gas prices, and steady growth in personal income all will help consumers build a strong financial base," Chessen added.
Consumers increasingly paid down personal loans, direct and indirect auto loans, property improvement, mobile home, RV and marine loans in the first quarter.
Personal loan delinquencies fell to 2.01% from 2.87%, and direct auto loan delinquencies fell to 0.86% from 1.06%. Meanwhile, fixed home loans fell to 4% from 4.08%.
Bank card delinquencies fell from 3.17% to 3.08% from the prior quarter, the lowest delinquency rate since 2001 and below a 15-year average of 3.93%.
