The composite rate was 0.83% in July, one basis point higher than the June rate. The first-mortgage default rate climbed to 0.62% by two basis points from June, while auto loan defaults rose four basis points to 0.86%. The rate for bank card default saw the only decline during the month to 3.31%. The July figure fell 18 basis points from a month ago, recording its biggest decrease in 12 months.
"Default rates for autos and first-mortgage loans are at their lowest points in the last 10 years, while bank card defaults remain modest," said David Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices. "Consumers' use of credit is growing and the level of consumer credit outstanding is at an all-time high. In the year ending June 2017, consumer credit outstanding rose 5.7%, outpacing most spending categories across the economy. However, retail sales excluding autos as well as auto sales are down slightly since April, while home sales are little changed in recent months.
The indices also showed that three of the five major cities posted lower default rates during the month. The biggest decrease was seen in New York with a 0.82% default rate, down six basis points from June. Los Angeles’ 0.63% rate for July was three basis points lower than a month ago, while Chicago posted a one basis point decline to 0.90%. Dallas and Miami saw default rates increase 10 basis points to 0.77% and six basis points to 1.23%, respectively.
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The rate of first-mortgage defaults rose in July along with the composite consumer credit default index, according to indices released by S&P Dow Jones Indices and Experian.