Over the last year, all of the nation’s top credit card lenders have seen rates of both delinquent and defaulted credit card debt decline significantly, but that trend is expected to bottom out in the near future.
Rates of delinquency and charge offs for major credit card lenders have dipped considerably since the end of the recession, but now experts believe the improvements have just about run their course, according to a report from the Wall Street Journal. Currently, these rates are at or near all-time historic lows for a number of major lenders.
The correction will likely come within the next few quarters, as rates for both types of late payments are expected to begin fluctuating along the lines of seasonal norms rather than plummeting as they have in recent quarters, the report said.
Some experts believe that one major cause of the continual drops in late credit card payments may have been due to charge offs that locked subprime borrowers out of the lending market altogether, but now more issuers are once again extending credit to these consumers.