Industry News

Borrowers pay credit-card bills, let mortgages slide

Gas, groceries take precedence over loans in Q3

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While homeowners had more trouble making mortgage payments during the third quarter of 2007, credit-card delinquencies actually fell, as consumers moved to preserve their ability to buy necessities like groceries and gasoline, a report from the American Bankers Association suggests. Late payments on credit cards during the third quarter fell 21 basis points, to 4.18 percent, the ABA said. Modest income and job growth helped credit-card repayment rates improve even as mortgage repayments worsened, said ABA Chief Economist James Chessen. "Consumers facing mortgage resets may be under financial pressure, but they still want to keep up with other payments," Chessen said in a statement. "They still need to heat their homes, put food on the table, and fill their cars with gas." The Mortgage Bankers Association last month reported that the delinquency rate on mortgage loans rose 47 basis points from the previous quarter, to 5.59 percent, the highest rate since 1986. The delinquency rate on su...