Consumers in New York may be well aware that most people consider the current economy to be strong and healthy. That, however, does not mean that there are not plenty of individuals out there who may be unable to pay their bills and who are struggling with serious credit card debt. There can be any number of reasons that find a consumer in this position and it can happen regardless of the general economic tide.
A report issued by Bloomberg recently indicated that keeping up with credit card payments appears to be a challenge for many American consumers as more banks have issued charge-offs for debt. A charge-off occurs when a lender decides to cease efforts in trying to collect a debt and instead essentially writes it off.
While the number of people filing for bankruptcy and the number of foreclosure filings have both decreased recently, the number of credit card charge-offs has increased. In 2016, such charge-offs accounted for 67% of consumer credit costs. Today, they account for 80% of consumer credit costs.
In the first quarter of 2019, the nation’s four biggest banks charged-off $4 billion in credit card debt compared to just over $650 million in all other consumer debts such as home loans and vehicle financing. Not since 2009 has the country seen this big of a gap in these areas. According to the Federal Reserve, late credit card payments by elderly consumers has also been noted although it was not indicated how many of the charge-offs related to consumers in the senior market.