Fewer Americans Behind on Credit Card Debt, but Average Balance is High

The number of credit card holders who have not paid their bills in the last 90 days has decreased in 2012. For Q1, the total number of delinquent cardholders dropped to 0.73 percent, from 0.78 percent for the last quarter of 2011. In addition, The Wall Street Journal reported that consumers continued to pay throughout May, despite worries from some experts that delinquency would increase in part because of continued high unemployment.

However, while delinquency has decreased, nearly half of cardholders who haven’t been able to pay for the last three months are using their cards out of necessity, such as to pay rent or buy groceries. In addition, balances are still high, with average cardholders carrying just under $5,000 in their balances.

Credit Card Settlements

One of the reasons for the low number of delinquent cardholders is that credit card companies were issuing cards to only those with high credit scores in the wake of the recession. However, from January to March, approximately one in four new cardholders were considered non-prime, higher-risk consumers.

In addition, for those who have carried a balance for years, it can be difficult to even make interest payments on the balance. For consumers who are struggling, credit card companies have been more willing than in previous years to allow a more reasonable payment plan under a credit card settlement agreement.

Credit card debt negotiation can help a cardholder avoid paying too much in interest (or even any at all), stop paying late fees and most importantly, allow the cardholder to regain control of his or her unsecured debt.

If you have credit card debt and are struggling to pay bills, you should contact an experienced debt relief attorney to discuss your options. Credit card companies can take attorney-led negotiations more seriously, and having an experienced negotiator on your side can allow you the maximum benefit.

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