Default Rates Down for First, Second Mortgages

Most of the S&P/Experian Consumer Credit Default Indices fell in March.  The national composite default index and both first and second mortgage indices declined from their February levels while the auto loan default rate remained flat at 1.11 percent and the bank card rate increased from the recent low of 3.37 percent posted in February to 3.51 percent.  All five indices are now well below levels of one year ago.

The national composite default index combining rates for all loan products was 1.50 percent in March, down from 1.55 percent in February and 1.96 percent in March 2012.   First mortgage loans had a default rate of 1.41 percent, down from 1.48 percent in February and 1.88 percent a year earlier and second mortgage rates went from 1.03 percent in March 2012 to 0.71 percent in February and down again to 0.69 percent in March.

"The first quarter of 2013 shows healthy consumer credit quality," says David M. Blitzer, Managing Director and Chairman of the Index Committee for S&P Dow Jones Indices. "The first and second mortgage default rates decreased, the bank card rate increased and the auto loan rate remained flat in March. All loan types remain below their respective levels a year ago."

The S&P/Experian Indices tracks default rates in five cities, New York, Chicago, Dallas, Los Angeles, and Miami and only in New York did the default rate increase, rising by 38 basis points.  All five cities have default rates below those of one year ago.

The table below provides the S&P/Experian Consumer Default Composite Indices for the five MSAs: