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More consumers are reducing their credit card debt and staying current on their credit card payments, judging by a new analysis of TransUnion credit records.
The average total debt per user dropped $286, or 5.8 percent, to $4,679 in the first quarter of 2011 from $4,965 in the fourth quarter of 2010. The most recent average was the lowest since the $4,695 recorded in the third quarter of 2000 and significantly lower than the peak of $5,776 in the first quarter of 2009 during the U.S. economic recession, TransUnion said in a statement.
The national credit card delinquency rate, which measures the proportion of credit card users 90 or more days late on their credit card payment, dipped to 0.74 percent in the most recent quarter. This rate dropped almost 10 percent compared with the 0.82 percent rate in the fourth quarter of 2010 and has fallen nearly 33 percent compared with the 1.11 percent delinquency rate recorded in the first quarter of 2010. The most recent rate was the lowest since the third quarter of 1996, TransUnion said.
The analysis, performed quarterly, was based on TransUnion's trends database and the credit files of approximately 10 percent of U.S. consumers who actively use credit cards or other credit accounts. TransUnion's trends database contains 27 million anonymous consumer records, randomly sampled every quarter from the company's national consumer credit database, the company explained.
Consumers weren't necessarily favoring their credit card over other debt such as a mortgage or auto loan. In fact, TransUnion also reported a significant drop in the national 60-day delinquency rate on auto loans in the first quarter of 2011 compared with both the prior quarter and the comparable prior-year quarter. The average auto debt per borrower was $12,585 in the most recent quarter. Borrowers who live in Washington, D.C., had the most auto debt, averaging $16,268 per borrower.
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