Credit Defaults at Lowest Rate Since 2006

Consumer credit defaults are running at an eight-year low, according to some new data from S&P Dow Jones Indices and Experian.

According to the data, American’s are keeping up with their credit payments at a rate not seen since May 2006 – which is a good sign that the economy is doing better than it has in years.

The companies said that the national composite posted 1.04% in May, with both auto and bank card default rates up a bit while mortgage default rates were down.

Auto loan defaults saw historic lows in March and April, and were up a tiny bit in May, to 0.93%. Bank card defaults stood at 2.97% in May, up 13 basis points from April.

Defaults on first mortgages, however, were down to 0.92% in May 2014. They were running at 1.30% in October 2013.

These numbers are all quite good, and signal that people are having an easier time managing their debt than at any time since before the recession.

 

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