NEW YORK – Falling from 1.29 percent to 1.27, the auto loan default rate continued to improve along with credit categories in July, according to the S&P/Experian Consumer Credit Default Indices.

Experiencing the largest decrease were second mortgage default rates, which dropped from 1.40 percent in June to 1.25 percent in July. First mortgage and bank car default rates also experienced decreases, falling from 1.93 percent and 5.64 percent, respectively, from June rates of 2.02 percent and 5.69 percent.

"By and large, July's data support the downward trend we have observed over the past two years," says David M. Blitzer, Managing Director and Chairman of the Index Committee for S&P Indices. " Despite high unemployment rates, consumers continue to improve their financial positions, resulting in lower default rates than we were seeing during the recession.”

Blitzer, however, said occasional increases in some of the regional composites may suggest that default rates may not fall a lot farther. “While recording the highest default rate of the five cities we report, Miami is still far off the near minus19 percent it had reported two years ago,” he noted. “However, the sluggish economies in both Miami and Chicago appear to be having a more severe impact on their residents than some of the other markets. Recent housing data also has pointed to weakness in these two markets beyond the national averages."

Among the five major Metropolitan Statistical Areas (MSAs) reported in this release each month, Dallas experienced a small increase in default rates, edging up from 1.59 percent in June to 1.60 percent in July. Los Angeles and Miami decreased moderately to 2.15 percent and 5.37 percent, respectively, from 2.17 percent and 5.41 percent. New York and Chicago also experienced a decrease in their default rate, which fell to 1.80% and 2.54% in July, respectively, from 1.82% and 2.59% in June.