S&P/Experian Indices Continue to Show Declining Default Rates
Monthly default rates across all credit lines declined in March, according to Standard & Poor’s and Experian’s Consumer Credit Default Indices, a comprehensive measure of changes in consumer credit defaults.
NEW YORK — Monthly default rates across all credit lines declined in March, according to Standard & Poor’s and Experian’s Consumer Credit Default Indices, a comprehensive measure of changes in consumer credit defaults.
The auto loan index had the largest decrease to a 1.47 percent default rate. The bank card index experienced the smallest decrease to a 5.59 percent default rate. The first and second mortgage indices declined to 2.33 percent and 1.42 percent, from 2.45 percent and 1.46 percent, respectively.
"Modest declines in consumer credit default rates continue across all major sectors as consumers gradually rebound from the financial crisis of two years ago," said David M. Blitzer, managing director and chairman of the Index Committee for S&P Indices. "Recent data from the Fed confirms a continuing decline in mortgage debt outstanding and a small increase in non-mortgage consumer debt driven by auto and similar loans. Bank card credit outstanding is declining. The declining debt levels, combined with the economic recovery, are supporting lower defaults and a gradual improvement in consumers' financial condition. This positive trend should help maintain the recovery."
Consumer credit defaults varied across major cities and regions of the United States. Among the five major Metropolitan Statistical Areas (MSAs) reported in this release each month, Los Angeles experienced a modest increase in defaults in March to 2.73 percent, from 2.70 percent in February. Miami and New York lead the way with largest decrease in defaults rates to 5.33 percent and 2.26 percent, from 6.05 percent and 2.53 percent, respectively. Dallas default rates declined to 1.65 percent and Chicago default rates decreased to 2.63 percent.
The table below summarizes the March 2011 results for the S&P/Experian Credit Default Indices. These data are not seasonally adjusted and are not subject to revision.
S&P/Experian Consumer Credit Default Indices
National Indices
Index | March Index Level | Change from February 2011 | Change from March 2010 |
Composite | 2.43 | -4.36% | -40.85% |
First Mortgage | 2.33 | -4.71% | -41.05% |
Second Mortgage | 1.42 | -2.73% | -49.13% |
Bank Card | 5.59 | -1.57% | -37.48% |
Auto Loans | 1.47 | -6.51% | -37.28% |
Source: S&P/Experian Consumer Credit Default Indices; Data through March 2011
The table below provides the S&P/Experian Consumer Default Composite Indices for the five MSAs:
Metropolitan Statistical Area | March Index Level | Change from February 2011 | Change from March 2010 |
New York | 2.26 | -10.58% | -46.98% |
Chicago | 2.63 | -6.85% | -40.94% |
Dallas | 1.65 | -7.16% | -47.14% |
Los Angeles | 2.73 | +1.31% | -52.66% |
Miami | 5.33 | -11.89% | -52.85% |
Source: S&P/Experian Consumer Credit Default Indices; Data through March 2011
More Auto Finance
Dealerships Are Paying the Price for Extended Car Loans
Growing negative-equity scenarios mean such lengthy terms should be addressed in a forward-looking way to make them work for the dealer and the consumer down the road.
Read More →
Trade-Ins in Negative Equity Reach New Heights
As such trade-ins rise in frequency, so do monthly loan payment amounts and interest rates, according to second-quarter data compiled by Edmunds.
Read More →
Auto Credit Plentiful
June numbers show lenders are readily granting access, including to risky borrowers, as consumers leverage themselves to take on high prices.
Read More →
Automotive Consumers Sink Further in Debt
Most financing metrics hit records in the second quarter as more buyers locked themselves into long terms and high monthly payments.
Read More →
Porsche Financial Services Shifts Structure
After 36 years with Porsche, the Financial Services Chief Financial Officer Konrad Riedl is retiring, and the department is realigning its management structure.
Read More →
Tariffs Could Raise Insurance Premiums
As U.S. import tariffs affect repair costs, consumers might find it more affordable to replace a damaged vehicle, according to recent Insurify tariff analysis.
Read More →
Smaller Loans, Longer Terms
The youngest generation of car buyers is more likely to finance less expensive vehicles, more than half of generation Z consumers borrowing less than $25,000.
Read More →
New Cars a Tad More Affordable
May averages show that combined circumstances gave auto consumers slightly better buying power for the month, though average prices were up year-over-year.
Read More →
First-Quarter Sees Long Auto Loan Growth
Experian data show more consumers are tapping the method, along with refinancings, to afford buying. Meanwhile, subprime borrowers are getting more access.
Read More →
Mastering Credit Friction
In this video, Josh Krach explains how to turn credit friction into an advantage.
Read More →