Chicago consumer credit default rates decline

By Wailin Wong
Posted Feb. 15 at 9:46 a.m.

Consumer credit default rates dropped in Chicago in January on a monthly and year-over-year basis, according to data released Tuesday by Standard & Poor’s and Experian.

The two firms track default rates across lines of consumer credit such as first and second mortgages, bank cards and auto loans. Chicago is one of five major cities that the S&P/Experian index breaks out separately. In Chicago, the January default rate was 2.74 percent, a decline of 42 percent from January 2010 and down 12 percent from December 2010.

On a national level, the composite default rate in January was 2.89 percent, down 37 percent from a year earlier.

“The reduced default rates seen here demonstrate that household balance sheets are being put back into shape and should support gains in spending,” David Blitzer, managing director and chairman of the S&P Index Committee, said in a statement.

The S&P/Experian Consumer Credit Default Indices measure the proportion of consumer credit accounts that go into default for the first time each month. The data come from credit bureau Experian, whose contributors include banks and mortgage companies representing about $11 trillion in outstanding loans from 11,500 lenders.

The indexes define default as 90 days or longer past due for mortgages and auto loans, and 180 days or longer past due for bank cards.

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