Data through December 2013, released by S&P Dow Jones Indices and Experian for the S&P/Experian Consumer Credit Default Indices, a comprehensive measure of changes in consumer credit defaults, showed decline in national default rates during the month. The national composite was 1.35 percent in December, a slight decrease from 1.37 percent in November.
The first mortgage default rate was 1.27 percent in December, marginally down from 1.28 percent last month. The second mortgage posted 0.76 percent in December, down from 0.78 percent in November. The auto loan default rate was 1.12 percent in December, down from 1.15 percent in the previous month. The bank card rate rose to 2.98 percent, slightly higher than its historic low of 2.97 percent set in the past two months.
“Consumers’ financial condition continues to improve," said David M. Blitzer, managing director and chairman of the Index Committee for S&P Dow Jones Indices. “Across all categories default rates are continuing a downward trend. Other data confirm the improving trends: Mortgage foreclosures were sharply lower in 2013 compared to 2012, the Federal Reserve’s measure of consumer debt service as a percentage of income is at a record low and consumer credit usage is expanding. The indices remain at pre-financial crisis levels.
“Four out of the five cities saw default rate increases. Miami saw the highest increase; it posted 2.74 percent, 28 basis points higher than last month’s level," continued Blitzer. "Los Angeles saw its default rate decline for a fifth consecutive month; it recorded 1.07 percent, the lowest default rate since July 2006. Miami has the highest rate among the five cities while Los Angeles had the lowest. Four cities – Chicago, Los Angeles, Miami and New York remain below default rates they posted a year ago, in December 2012.”