How credit card delinquencies affect your bottom line

It’s a sad fact that good news is rarely 100% positive; usually we can expect some undesirable result from sunny situations. The U.S. economy’s recovery after the Great Recession is a perfect example. While we’re pleased about low unemployment and consumer spending in support of employment and economic growth, the lending industry is beginning to see a negative byproduct of that improved economy: rising credit card delinquency.

As consumers’ confidence in their earning power and ability to pay bills has improved, they’ve become willing to buy, spend, and charge more. Unfortunately, not all U.S. consumers can back up their confidence with the actual ability to pay.

Consumers happy about the prosperous economy see no reason to say “no” to new debt, and they may be biting off more than they can chew, especially as interest rates rise. According to TransUnion, the lending industry must watch their accounts, as signs point to increased credit card delinquencies. Leading indicators suggesting this concern may be warranted are as follows:

  • The number of credit card accounts that are 90 days delinquent has increased steadily every year since 2014.


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