Smart Borrower Blog

Have We Reached the Bottom of Credit Card Delinquencies?

Feb 17th, 2010 @ 9:26 PM by Amber Nelson

Things may very soon start looking up for American consumers. New data from the lending market shows that credit card delinquencies are leveling out as of January. Four of the six largest credit card lenders reported delinquency rates that barely moved last month while the other two actually had declining rates.

Bank of America’s credit card delinquency rate, the percentage of borrowers that are 60 days or more late on their payments, fell to 7.35 percent in January from 7.44 percent in December. American Express said its delinquency rate dropped by 0.1 percent during the same period.

Capital One saw its delinquency rate inch up to 5.8 percent, barely moved from 5.78 percent in December. Discover Financial Services had an increase from 5.5 percent to 5.6 percent. JPMorgan Chase and Citigroup also posted delinquency rates that were nearly unchanged.

So what does it mean? It means that there may be a seasonal recovery and that this may also be the bottom of consumer woes as the number of people late on their credit card payments starts to stabilize.

And the Democratic Underground says that:

“Credit card charge-offs and delinquencies usually track U.S. unemployment, which fell to a five-month low of 9.7 percent in January. That surprised economists and hinted at a labor market recovery despite the loss of 20,000 jobs in the month.”

So the market is doing better than the analysts were predicting. That’s always good news!

About Amber Nelson
Amber Nelson is a seasoned mortgage industry writer and a regular contributor to and

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