Experian Consumer Borrowing Study Shows Big Increase in Late Pays

Experian Consumer Direct, a leading provider of online direct-to-consumer credit reports, scores and monitoring, today announced the results of a recent National Score Index study showing a 16.9 percent decline from 2001 to 2006 in the rate at which consumers are opening new credit accounts and a 12.6 percent rate at which late payments of 90 days or more are increasing.

The national average credit score is 675 — 7 points lower from 2001 when it was 682.

The rate of consumers opening new accounts, including installment loans (i.e., auto and student loans) and revolving credit accounts (i.e., bank and retail credit cards), in 2006 has fallen to 41.0 percent from 49.3 percent in 2001. The rate at which consumers were 90 days or more late in payments increased 12.6 percent from 2001 (39.6 percent) to 2006 (44.6 percent).

“The drop in the rate of consumers opening new accounts in 2006 may give the appearance that they are being more conservative with regard to using credit, however this may not be the case when combined with other results from our study,” said Ty Taylor, president of Experian Consumer Direct. “Although our data shows a drop in the rate of consumers opening bank credit card accounts, it also shows that their balances on other types of loans, such as installment loans, are increasing.”