Delinquencies on consumer and home-equity loans rose in the first quarter as unemployed Americans struggled to pay their bills, the Wall Street Journal reports. The number of borrowers at least 30 days late on their consumer loans, which include auto loans, rose slightly to 3.23% from the previous quarter. Delinquencies on home-equity loans rose about half a point to a record 3.52%.
Evidence suggests that consumers are using bank-issued credit cards to plug gaps in their budget: Delinquencies on such cards rose to 4.75% from 4.52% in the previous quarter, while the balances on those cards surged 1.08 percentage points to a record 6.6% of total credit-card debt. "The No. 1 driver of delinquencies is job loss," said a top economist with the American Bankers Association. “Delinquencies won't improve until companies start hiring again.”