The quarterly performance of home-equity products at financial institutions was better. Loans for property improvements, however, saw deterioration.
The composite 30-day delinquency rate was 1.63 percent as of Sept. 30, 2013. Composite delinquency reflects activity on eight consumer loans types.
Three months earlier, the composite rate was 1.76 percent, while it stood at 2.16 percent a year earlier.
The American Bankers Association reported the delinquency data Thursday in its Consumer Credit Delinquency Bulletin.
“More jobs and higher income are a recipe for lower delinquencies,” ABA Chief Economist James Chessen stated in the report. “Consumers also continue to do a good job of monitoring their finances and keeping debt at manageable levels.”
Chessen predicts that small fluctuations in delinquency rates are likely in coming months as the economy continues to improve.
One of the loan types that make up the composite index, home-equity loans, had 30-day delinquency of 3.58 percent, falling from 3.83 percent as of June 30, 2013.
HEL delinquency was 4.20 percent at the same point in 2012.
The 30-day rate was 1.71 percent on home-equity lines of credit, dropping from 1.90 percent at the end of the second quarter..
HELOC delinquency was 1.93 percent at the end of the third quarter of the previous year.
“Rising home prices have relieved some of the pressure on home equity loans and home equity lines of credit,” Chessen said. “This is another sign of a housing sector recovery as people find it easier to sell or refinance their homes.”
Property improvement loan delinquency worsened, however, soaring to 1.25 percent from 0.80 percent at the end of the second quarter. This category also deteriorated from the third-quarter 2012, when the rate was 0.89 percent.
One other category, mobile home loans, had a delinquency rate of 3.64 percent, better than 3.96 percent in the previous report and 3.51 percent a year earlier.
