Iowans’ average credit card debt is lowest in nation

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(MCT) — If $4,225 sounds like a lot of credit card debt, think again.

That was the average credit card debt of Iowa residents in the third quarter of 2009, according to TransUnion Corp. It may sound like a lot, but it was lower than the average credit card debt of any other state that quarter.

Iowans have historically had some of the lowest credit card balances for a variety of reasons, said Ezra Becker, director of consult and strategy for TransUnion. The cost of living is lower and Iowans tend to have lower debts in other categories.

Real estate, for example, is less expensive in Iowa than in many hot growth markets.

Credit card debt has trended downward in the past year as Americans, worried about job loss, try to manage credit more wisely.

The average American credit card debt was $5,612, down $107 from the second quarter.
Credit card delinquencies trended downward from the second quarter. The national credit card delinquency rate dropped to 1.1 percent, down 5.98 percent from the second quarter.

That’s unusual because the credit card delinquency rate typically rises from the second to third quarter. In fact, the drop in this year’s third quarter was the first in 10 years.

Becker said the atypical trend could be lending institutions tightening up on credit due to rising unemployment and other risk factors, and consumers taking better care of their credit because they realize they depend heavily on credit cards.

Credit card delinquencies rose fastest last quarter in Hawaii, where cardholders 90 days or more past due increased 5.48 percent.

The lowest credit card delinquency rate was 0.66 percent in North Dakota, while the highest was 1.98 percent in Nevada.

Delinquency rates were second highest in Florida (1.47 percent) and Arizona (1.35 percent), two states hurt by the plunge in new housing construction.

TransUnion expects credit card delinquencies to remain steady at about 1.1 percent nationally for the remainder of the year, with a possible drift upward in early 2010.

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