The total balance of bank credit cards showed a slight year-over-year increase in July, from $533.3 billion to $536.5 billion. While it’s small — less than 1% — it’s the first annual increase in five years, according to a news release for Equifax’s latest National Consumer Credit Trends Report.
While credit card balances and new credit have both increased, serious delinquencies have declined 11%, making up 1.86% of outstanding balances in July. New loans and new credit hit five-year highs.
The total number of loans originated between January and May of 2013 increased from 15.6 million to 16.6 million from that time last year — a more than 6% increase. New credit opened in that time period increased 6% from last year, from $72.9 billion to $77.7 billion.
In terms of other areas of consumer credit, student loans saw the most growth. Loan balances increased 11.3% since July 2012 ($794.6 billion to $884.2 billion). Auto loan balances also increased, from $745.3 billion to $826.8 billion (10.9%).
Balances for first mortgages, home equity installment loans and home equity revolving loans decreased.
“Only two major consumer credit segments are currently growing: auto financing and student loans,” Equifax Chief Economist Amy Crews Cutts said in the news release. “In all other segments, consumers are reducing their debt burdens, either negatively, through foreclosures and bankruptcies, or positively, through payoffs — payoffs are dominating in most cases today.”
She also noted that Equifax economists expect mortgage balances to start rising in the coming months.
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