Number of credit cards delinquent on payment recedes in April
Delinquencies on credit cards dropped in April, according to a recent report from Fitch Ratings.
The number of accounts that were more than 60 days late fell to 4.18 percent during the month, a decline of 0.09 percentage points. Cards that were at least 30 days late also declined 0.21 percentage points to 5.53 percent.
However, the firm also said that the number of charged off accounts increased during the fourth month of 2010. These are debts that credit card issuers do not expect to be repaid, and saw a rise to 11.1 percent of cards in the country.
“While delinquencies improved, charge offs rose as persistently high unemployment rates and higher personal bankruptcy filings continue to reflect the ongoing strains consumers are facing,” Fitch Ratings said.
Although charge offs are up, declines in delinquencies could mean the number of defaulted accounts will decline in the future. Furthermore, new rules through the Credit Card Accountability, Responsibility and Disclosure Act could make it easier for people to pay down debt by limiting card issuers’ ability to increase interest rates.
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