Iowa credit card delinquency rate nearly lowest in U.S.

Nationally, average credit card debt per borrower drops 1.7 percent

George Ford
Published: May 22 2013 | 9:00 am - Updated: 28 March 2014 | 3:38 pm in
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Iowa's credit card delinquency rate (the ratio of borrowers 90 or more days past due) was nearly the lowest in the nation in the first quarter.

TransUnion Financial Services on Tuesday reported 0.47 percent of Iowa credit card accounts were delinquent on March 31. South Dakota, North Dakota and Montana were tied for the lowest delinquency rate at 0.43 percent, followed by Minnesota at 0.44 percent.

Mississippi had the highest credit card delinquency rate at 1.11 percent. Nationally, the average credit card delinquency rate was 0.69 percent, down 18.82 percent from 0.85 percent in the final quarter of 2012.

Iowa had the lowest credit card debt per borrower in the first quarter with an average $3,810, followed by North Dakota with an average $3,987. Alaska recorded the highest average credit card debt at $6,789.

Nationally, average credit card debt per borrower dropped 1.7 percent to $4,878 in the quarter that ended on March 31  from $4,962 in the same period of 2012. On a quarterly basis, card debt decreased 4.8 percent from an average $5,122 in the fourth quarter of 2012.

Ezra Becker, vice president of research and consulting for TransUnion Financial Services, said the first quarter decline in credit card debt is not unusual.

"We traditionally see credit card delinquencies and balances decline during the first three months of the year as many people pay down their holiday shopping balances or use their tax refunds to pay off their debts," Becker said.

Since the beginning of the recession at the end of 2007, the credit card delinquency rate has declined five out of six times during the first quarter of the year on a quarterly basis, according to TransUnion. The average first-quarter decline for the same time frame has been 7.2 percent.

TransUnion said 65 percent of the nation's metropolitan statistical areas experienced declines in their respective delinquency rates in the first quarter of the year compared with the rate in the same quarter of 2012.

The TransUnion quarterly analysis of credit card performance also examines origination rates, which are evaluated in the quarter before the delinquency rate period. New credit card accounts dropped 1.6 percent in the final quarter of 2012 compared with the same period in 2011.

"Though fourth quarter credit card originations dropped when compared to the prior year, the number of new credit cards entering the marketplace is still significantly greater than what we saw just a few years ago," Becker said.

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