Average Card Debt, Delinquencies Dropped in 1st Q: TransUnion

Credit cardholders did a better job of paying off their bills in the first quarter of 2008 compared with the fourth quarter of 2007, according to an analysis from TransUnion, the Chicago-based credit and information management firm.

The national average credit card debt per cardholder dropped 1.25 percent in the first quarter of this year to $1,673 compared with $1,694 in the fourth quarter of 2007, TransUnion reported in its Trend Data quarterly report.

Broken down by state, the highest average card debt per cardholder was seen in Alaska with $2,378, while Iowa had the lowest average with $1,252, according to TransUnion.

The ratio of credit cardholders delinquent on one or more of their accounts nationwide fell to 1.19 percent in the first quarter, down more than 12 percent from the previous quarter. Delinquent accounts are defined as those 90 or more days past due.

Nevada had the highest delinquency ratio with 1.74 percent, while North Dakota scored the lowest with 0.67 percent.

Ezra Becker, principle consultant in TransUnion’s financial service group, said in a statement that consumers were catching up on their card payments just as they improved their mortgage payments in the first quarter.

Still, both average card debt per cardholder and delinquencies were higher in the first quarter of this year than in the same period in 2007. The level of debt per cardholder was 5.6 percent higher than the average for the first quarter of 2007, while the delinquency ratio was about 1 percent higher.

That may be a portent of the rest of the year. Becker predicted that the card delinquency rate will decline in the second quarter but “gradually edge back up to 1.20 percent and above, as increases in gas prices add to the overall financial burden of the consumer.”

TransUnion conducts a random sampling of a database of 27 million anonymous consumer records to create Trend Data, its quarterly analysis of consumer debt. The reports focus on credit card, auto loan and mortgage lending.