Archive for the ‘Credit Cards’ Category

The Recession: 10 Years Later

Posted on December 08, 2017 by Laura Lam

In December 2007, employment peaked and started to head south – for two long years.  What followed: The loss of more than 8 million jobs, half the value of the Dow and the S&P 500, and trillions of dollars in retirement accounts and household wealth. Lives and businesses were ruined and whole neighborhoods emptied out, as banks took back homes bought on badly underwritten credit. A decade later, the American economy has recovered in many ways. Employers have been steadily adding jobs since early 2010, the stock market is booming and home prices have reached new all-time highs.  But in…

Cybercrime Will Increase in 2018

Posted on December 05, 2017 by Laura Lam

If you think 2017 was a bad year for cyberattacks, just wait to see what happens in the coming years, one cybersecurity expert warns. “We’ve only seen the beginning,” said Dr. Eric Cole, CEO of Secure Anchor and former CTO of McAfee and Lockheed Martin.  “Cybercrime is big business, it’s a very high-payoff, low-risk crime … we’ve seen nothing yet.” In 2016, U.S. financial losses stemming from cyberattacks totaled $1.33 billion, a 24% increase over the year prior, according to an FBI report. An Accenture study concluded that the number of hacks likely increased by more than 27% between 2016…

Debt-to-Income Levels Could be Under Stress

Posted on November 28, 2017 by Laura Lam

Defaults for second lien mortgages and other types of consumer credit in October were up compared to the previous month, according to Standard & Poor’s and Experian’s indices.  “For the first time since January 2017, the default rate for autos, bank cards and mortgages all rose together,” said David Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices. “The data does not suggest any unusual financial stress facing consumers which would explain the small, but across the board increases in default rates,” he said.  However, “the one concerning item, which might explain the default numbers, is recent…

Americans Waiting for a Bigger Raise

Posted on November 17, 2017 by Laura Lam

The government said that average hourly earnings rose 2.4% over the past 12 months.  That’s a slip from the 2.9% increase reported in September. It remains below the 3% to 3.5% range that many agree is normal in a truly healthy economy.  The last time wages were up more than 3% year-over-year was in April 2009, just as the economy was emerging from the depths of the global banking crisis that fueled the Great Recession. Why have wages remained stagnant even though many other indicators of the job market and broader economy look healthy? Unemployment continues to drop. The housing…

Are Home Equity Loans Staged for a Comeback?

Posted on November 15, 2017 by Laura Lam

There has been a hint of optimism for home equity lending among bankers this earnings season, but attitudes remain mixed a decade after the housing market crash began.  While home equity lines of credit provided a lift to some bank consumer portfolios, a number of other banks said their home equity businesses had fallen and added little about their future. Industry observers say bankers should take the long view. Home equity lines of credit especially are poised to grow now that home values have been rising for a number of years during the economic recovery.  “If you think about the…

Millennials are saving more for retirement

Posted on November 10, 2017 by Laura Lam

In the race to save for retirement, one group is doing surprisingly well: millennial parents.  That’s according to a new NerdWallet survey, which found that 38% of millennial parents (ages 18-34) save more than 15% of their income for retirement. All told, millennial parents reported a median retirement savings rate of 10% of income, compared with 8% for Generation X parents (ages 35-54) and just 5% for baby boomer parents (ages 55+). Given the picture typically painted of this age group, you might be shouting “fake news” right now. There’s one caveat: The results include only those currently saving for…

Credit Card Delinquencies Are Rising

Posted on November 01, 2017 by Laura Lam

While it’s easy to ignore when the stock market is at record highs and unemployment is reassuringly low, household debt is on the rise.  The Center for Microeconomic Data’s (CMD) latest Quarterly Report on Household Debt and Credit reveals that total household debt rose by $114 billion (0.9%) to $12.84 trillion in the second quarter of 2017.  This increase put overall household debt $164 billion above its peak in the third quarter of 2008, and 15.1% above its trough in the second quarter of 2013 Consumer debt, in many ways, should generate more concern – during the good times.  The persistence of…

Halloween Scares Up Record Sales

Posted on October 31, 2017 by Laura Lam

This may not be good news for your waistline, but your sweet tooth might appreciate it: Halloween candy sales are crackerjack this year.  Halloween candy sales are expected to rise 4.1% from last year, reaching a seasonally adjusted $4.1 billion, according to HIS Markit data.  “Consumer confidence is riding high, so consumers are likely to splurge a little more on edible goodies,” said David Deull, a senior economist with IHS Markit. The sales increase is particularly impressive given that candy prices have dropped 0.9% compared with last year, marking the second consecutive Halloween candy price decline, according to IHS Markit…

Best and Worst States for Consumer Credit Scores

Posted on October 30, 2017 by Laura Lam

Consumer credit varies nationally due to regional variations in income and the cost of living.  According to a new study from LendEDU and Experian, the Northeast had the highest average credit score (694). The Midwest (693), Pacific (691), and Rocky Mountain (690) regions followed closely behind. The Southeast (668) and Southwest (662) regions had the lowest credit scores on average.  The best average state scores are roughly 7% higher than the national average, while the worst states are about 7% lower. Vantage Scores were used for the rankings. Scores of 700 and above are considered good, and below 650 is…

Mortgage Default Rates Begin to Rise

Posted on October 24, 2017 by Laura Lam

Mortgage defaults in September were slightly higher than in the previous month and are still lower than a year ago but they are closer to matching levels seen in 2016.  The default rate for first mortgages last month was 0.66%, up a basis point from August, but down a basis point from September a year ago, according to Standard & Poor’s and Experian. Second-mortgage default rates were three basis points higher on a consecutive-month basis at 0.53% but were 3 basis points lower year-to-year.  The composite default rate for mortgage, bank card and auto loan credit was up 2 basis points from…