Struggling metro areas see yearly decline in credit card debt
Credit card debt flat for U.S. as a whole
Metropolitan areas in the U.S. termed as struggling, or still recovering economically, posted yearly declines in credit card debt in August, a recent report from Equifax said.
According to Equifax, credit card debt in the U.S. as a whole stayed relatively even year-over-year in August but areas still struggling to recover saw shrinking debt related to credit cards.
Struggling areas posting a decline in credit card debt include Detroit, Las Vegas, Los Angeles, and Sacramento.
“The differences between the metro areas illustrate the uneven nature of the economic recovery,” Trey Loughran, president of the Personal Solutions unit at Equifax, said in a statement.
Equifax’s data showed that for the entire U.S., credit card debt increased slightly in August – .02 percent from a year earlier in August 2011. Metropolitan areas that saw an increase in credit card debt include Houston, Washington D.C., Dallas and Seattle.
“In places where the housing bust was the worst, such as Florida, California and Nevada, and in places like Detroit and Ohio where the recession was particularly deep because of a dependence on manufacturing, consumers are continuing to be prudent about using credit,” Loughran said. “In other pockets of the country, consumers are feeling a bit more confident to take on new debt.”
Credit card debt decreasing
Since the recession hit the U.S. back in 2008, American consumers have been relying on credit cards less and less.
In fact, total consumer credit card debt in August 2012 was 22 percent lower than the peak seen in October 2008, Equifax said.
“We are seeing the trend of the ‘disciplined consumer,’” Loughran said. “We don’t know whether this is a long-term change yet, but generally speaking, Americans today continue to be prudent about credit.”