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Equifax Reports Improving Delinquency Rates, Rising New Credit Mid-Way Through 2013
Monday, July 29, 2013 6:55 AM

According to Equifax's latest National Consumer Credit Trends Report, consumer payment behavior and delinquencies are improving and new credit is increasing across nearly all verticals year-to-date in June 2013.

For home finance, year-over-year serious delinquency rates (90-days or more past due or in foreclosure) declined sharply as a percentage of total balances outstanding:

  • First mortgage: decreased more than 27 percent (from 5.70 percent to 4.14 percent);
  • Home equity revolving: decreased nearly 24 percent (from 2.30 percent to 1.75 percent); and
  • Home equity installment: decreased more than 20 percent (from 4.16 percent to 3.31 percent).

In addition, year-over-year changes in the 60-day-plus delinquency rates for other verticals include:

  • Bankcard: decreased more than 16 percent (from 2.17 percent to 1.82 percent); and
  • Auto: decreased more than 11 percent (from 1.24 percent to 1.09 percent).

"The turnaround in home price trends over the past year is having a substantial impact on mortgage delinquency rates. As more and more homeowners find themselves back in positive equity, the incentive to default is strongly tempered," said Equifax Chief Economist Amy Crews Cutts. "While performance in other sectors is improving with the gradual economic recovery, we are seeing a strikingly different trend with student loan debt, which is both the fastest growing consumer debt segment and the only segment in which we're seeing rising severe delinquency rates and accelerating write-off rates."