Consumer Loan Delinquencies Fall Across the Board, ABA Says

U.S. consumer-loan delinquencies fell across the board in the fourth quarter as borrowers benefited from improving job and housing markets, the American Bankers Association said.

Total delinquencies in the 11 loan categories surveyed by the Washington-based trade group fell to 2.49 percent of all accounts, from 2.59 percent in the preceding quarter, the ABA said today in its Consumer Credit Delinquency Bulletin. The report covering a three-month period through Dec. 31 marked the first time in eight years all 11 loan categories fell in the same quarter.

“You can’t get a better consumer credit report card than this,” James Chessen, the ABA’s chief economist, said in a statement. Chessen credited consumer deleveraging and improvements in the broader economy for the positive results.

February’s job numbers marked the best six months of growth since 2006, with unemployment reaching a three-year low, and gains in the stock market have contributed to an uptick in consumer confidence and spending.

The ABA survey, which defines delinquency as a late payment that is 30 days or more overdue, found that credit card late payments dropped to 3.17 percent of all accounts, from 3.25 percent, equaling the lowest level since 2001, the ABA said. Home-equity credit line delinquencies fell to 1.69 percent of all accounts, from 1.93 percent in the third quarter.

“The economic tide at the end of 2011 lifted most boats,” Chessen said. “The biggest concern I have now is retail gas prices.”

Home equity loan delinquencies fell to 4.08 percent in the fourth quarter, from 4.12 percent three months earlier as the housing market moved closer to stabilization.

To contact the reporter on this story: Phil Mattingly in Washington at pmattingly@bloomberg.net

To contact the editor responsible for this story: Maura Reynolds at mreynolds34@bloomberg.net