Consumer debt has fallen considerably over the last year, as have late payments across a number of loan types, but at the same time, consumers are once again starting to open new credit cards.
Consumers were far more conscientious in their attempts to reduce debt in 2011 than they had been in the past, as the total amount owed to lenders across all loan types slipped to $11.1 trillion nationwide, down from October 2008's all-time record of $12.4 trillion, according to the latest National Credit Trends Report from Equifax. Delinquent credit card debt on both bank- and retailer-issued cards slipped considerably in 2011, by 29 percent and 15 percent from 2010's totals, as did instances of late payments for mortgages, consumer finance loans and auto loans.
At the same time, though, origination of bank-issued credit cards for subprime borrowers increased significantly between January and October, rising 48 percent, the report said. In addition, retailers saw the number of cards opened by all borrowers tick up 7 percent, reversing a trend of four straight years of declines.
Experts believed that the recession drastically changed consumers' attitudes toward borrowing and led them to focus on debt relief, but new card originations may show consumers are eager to do so again.