The national default rate on first mortgages as of March stood at about 0.77%, down seven basis points from 0.84% in February and down from 0.92% in March 2015, according to the S&P/Experian Consumer Credit Default Indices.
Meanwhile, the default rate for auto loans decreased three basis points from February to reach 1.02%, and the default rate for credit cards saw a significant increase to reach 2.92%, up 36 basis points from the previous month, according to the index.
The composite rate in March was 0.93%, down four basis points from February.
“The continuing low rates of consumer credit defaults in mortgages, auto, and bank card loans are positive signs for the economy,” says David M. Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices.
“Large mortgage debts followed by rapidly rising defaults in all kinds of consumer credit were key causes of the financial crisis,” Blitzer continues. “Conditions today are much improved; not only are defaults down, but outstanding mortgage balances were about 12% below the peak seen in the first quarter of 2008. Debt service ratios are close to the record lows set in the last two years, as well. This all suggests that consumer spending should continue to support modest economic growth.”
