NEW YORK — Data through October 2011, released by S&P Indices and Experian for the S&P/Experian Consumer Credit Default Indices, a comprehensive measure of changes in consumer credit defaults, showed that first mortgage default rates rose to 2.08% in October from September’s 1.99%. Auto loans and second mortgage default rates decreased slightly; auto loans moved down from 1.29% in September to 1.22% in October, and second mortgages from 1.32% to 1.29%, respectively. Bank card default rates declined the most, from 5.36% in September to 4.85% in October.
“This month’s data show how much weight first mortgage default rates have in the national composite, about 84%,” says David M. Blitzer, Managing Director and Chairman of the Index Committee for S&P Indices. “Auto loan, second mortgages and especially bank cards all saw pretty significant drops in their default rates. However, the national composite rose with first mortgages. Home purchases are obviously very large investments, so first mortgage loans are substantially larger than any other consumer loan type. Consequently, when such a loan goes into default it is more serious from the perspective of the consumer’s overall financial status than the others. This is the second time we have seen the rates go up for first mortgages since November 2010. Looking at the regions, Chicago saw the largest increase, moving from 2.47% to 2.64%. Miami fell the most, to 4.16%, well below the near 19% it had registered a little more than two years ago. While we continue to see some monthly volatility in these numbers, the broad trend seems to be that consumers are continuing to repair their balance sheets.”
Among the five major Metropolitan Statistical Areas (MSAs) reported in this release, Miami showed a substantial decrease in default rates from 4.59% in September to 4.16% in October. Chicago, Los Angeles and New York increased to 2.64%, 2.15% and 2.09% in October, from 2.47%, 2.12% and 2.01% in September, respectively. Dallas default rates moved down slightly from 1.33% in September to 1.30% in October.
The table below summarizes the October 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 IndicesNational Indices|
|Source: S&P/Experian Consumer Credit Default IndicesData through October 2011|
The table below provides the S&P/Experian Consumer Default Composite Indices for the five MSAs:
|Source: S&P/Experian Consumer Credit Default IndicesData through October 2011|
Jointly developed by S&P Indices and Experian, the S&P/Experian Consumer Credit Default Indices are published on the third Tuesday of each month at 9:00 am ET. They are constructed to accurately track the default experience of consumer balances in four key loan categories: auto, bankcard, first mortgage lien and second mortgage lien. The Indices are calculated based on data extracted from Experian’s consumer credit database. This database is populated with individual consumer loan and payment data submitted by lenders to Experian every month. Experian’s base of data contributors includes leading banks and mortgage companies, and covers approximately $11 trillion in outstanding loans sourced from 11,500 lenders.
For more information, please visit: www.consumercreditindices.standardandpoors.com.
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Experian is the leading global information services company, providing data and analytical tools to clients in more than 90 countries. The company helps businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. Experian also helps individuals to check their credit report and credit score and protect against identity theft.
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