Buddhist Catholic Contemplative Evangelical General Christian Hindu Jewish Latter-day Saint Muslim New Visions Progressive Christian

Beliefs

Topics

Columnists

Resource Library

Research Tools

Video

Podcasts

Thought Readers

Faith In Media Tracker

Newsletters

Ad-Free & Subscriber Log-In Subscription Support

Follow Patheos

Drishtikone

Home
Hindu
Credit-card delinquencies hit record

Credit-card delinquencies hit record

Last updated on: October 3, 2005 at 3:52 pm by Desh Kapoor

Credit-card delinquencies hit record 2005-10-03T15:52:20-05:00 Desh Kapoor

LOGO Patheos Explore the world's faith through different perspectives on religion and spirituality! Patheos has the views of the prevalent religions and spiritualities of the world.

URL Link:

http://money.cnn.com/2005/09/28/pf/debt/delinquencies/index.htm

Highlights:

Hit by rising gasoline prices, a record percentage of credit-card accounts were delinquent in the second quarter, the American Bankers Association reported Wednesday.

The ABA found that the 4.81 percent of credit-card accounts had payments that were past due by 30 days or more between April and June. That’s up from 4.76 percent in the first quarter, which was the previous record. The ABA started tracking delinquencies in 1973.

The ABA also noted an increase in delinquent payments on personal loans, auto loans, home equity loans and lines of credit.

A key reason for the increase: the strain of higher gas prices.

The group noted that the the average cost of filling up the gas tank of a mid-size car in June averaged $38.33, up from $30.63 at the end of last year. Today, the average is higher still, at $47.78.

“The last two quarters have not been pretty. Gas prices are taking huge chunks out of wallets, leaving some individuals with little left to meet their financial obligations,” ABA chief economist James Chessen said in a statement.

What about the Katrina effect?
An obvious question, post-Katrina, is what will happen in the next few quarters to delinquency numbers, given that some evacuees, left jobless and homeless, may be relying on credit cards to get through the initial stages of rebuilding their lives.

If there is going to be a Katrina effect, Chessen said in an interview, it may not show up until the fourth quarter, which more fully encompasses the post-hurricane period.

Credit-card companies must report delinquencies to the Federal Reserve, but they have agreed not to report evacuees’ delinquent payments to the credit bureaus for an indefinite period of time in order to preserve survivors’ credit standing.

What to do if you’re in deep
It’s one thing to carry a balance on a credit card for awhile. It’s another thing if you can’t afford to pay your bill on time. The ABA noted five key signs you’re overextended financially:

You can only afford to make minimum payments on your credit card;

You’re always short of cash;

You’re late on important payments, such as rent or the mortgage;

You take longer and longer to pay off your balances;

You borrow from one lender to pay another.

The consequences of being delinquent on your credit-card payments are costly and can greatly compound your debt problems.

Late fees, which average $27.46, may be imposed, in addition to sky-high penalty rates, which average just over 24 percent, but can top 30 percent. That penalty rate will remain on your account for as long as the creditor chooses.

And because of “universal default” policies, being delinquent on one card can trigger penalty rates on others, even if your payments are current on them.

(See other ways you may get slammed with credit card costs.)

Lastly, your credit score will take a hit when the delinquency is reported to the credit bureaus. And that means you will get higher interest rates on any loans you may seek.

There are some initial steps you can take to tackle your debt. First, try to pay at least the minimum owed on time every month; avoid using your credit cards until you’ve gotten a handle on your debt; and contact creditors to let them know your situation. They may be willing to negotiate a deal, or at least give you an extension to meet your obligation.

Source:
CNN

Uncategorized

Previous Post

October 3, 2005

Dr Doom expects trouble between US and China

Next Post

October 3, 2005 Counting on a Miracle With U.S. Debt

Browse Our Archives

Select a Category Aarti Achievement and Leadership AfPak Africa Annual and Year-end Asia Audio Australia Behavioural Sciences Bhagwad Gita Bhagwad Gita Blogging Blogs Business Business Intelligence Business Strategy Cannes Careers Chanakya China Conservation Corruption Creative Daily Links Desh Poems Development & Welfare Devotional Audio Devotional Songs Drama Earth Economics Education Entertainment Environment Europe Everyday Quotes Featured Articles Featured Songs Finance Flickr Pictures Food Geo-Political Global Warming Globalization Health & Medicine Hinduism Historic History Humour India Indian Culture Indian music Indian Weddings Israel Issues Legal Link Love Minorities Misc Motivation and Personal Development Movie Lists Movie Reviews Movies Mumbai terror attacks Natural Disasters Nature News Outsourcing Pakistan Parenting Personal Philosophy Poetry Politics Poverty Quotes Recipe Regular Blog Post Relationships Religion Religious/Spiritual Audio Sciences Showcase Slideshow South Asia Special Stories Spiritual Quotes Spirituality Sports Stories Strategy Technology Technology Terrorism Travel Uncategorized US Video Women Women_s Rights Worship Yoga

Select a Month December 2015 November 2015 October 2015 September 2015 August 2015 June 2015 April 2015 March 2015 February 2015 September 2014 August 2014 January 2014 November 2013 October 2013 September 2013 August 2013 July 2013 June 2013 April 2013 March 2013 February 2013 January 2013 December 2012 November 2012 October 2012 September 2012 August 2012 July 2012 June 2012 May 2012 April 2012 March 2012 February 2012 January 2012 December 2011 November 2011 October 2011 September 2011 August 2011 July 2011 June 2011 May 2011 April 2011 March 2011 February 2011 January 2011 December 2010 November 2010 October 2010 September 2010 August 2010 July 2010 June 2010 May 2010 April 2010 March 2010 February 2010 January 2010 December 2009 November 2009 October 2009 September 2009 August 2009 July 2009 June 2009 May 2009 April 2009 March 2009 February 2009 January 2009 December 2008 November 2008 October 2008 September 2008 August 2008 July 2008 June 2008 May 2008 April 2008 March 2008 February 2008 January 2008 December 2007 November 2007 October 2007 September 2007 August 2007 July 2007 June 2007 May 2007 April 2007 March 2007 February 2007 January 2007 December 2006 November 2006 October 2006 September 2006 August 2006 July 2006 June 2006 May 2006 April 2006 March 2006 February 2006 January 2006 December 2005 November 2005 October 2005 September 2005 August 2005

TAKE THE

Religious Wisdom Quiz

Your eyes are compared to these gentle birds, and your temples behind your veil are like the halves of a fruit. What is the fruit?

Select your answer to see how you score.

A fig A grape An apple A pomegranate