Canadians get better at debt payments... but credit card debt is crippling!

Following is an article that sheds some positive light towards Canadians getting better with servicing their credit card & car load debts. Regardless, unsecured debt such as credit cards needs to be address on a national & global level in my opinion. I recently tried working with a few clients who had accumulated 10+ credit cards from reputable banks at interest rates over 22%. In this situation there is an accumulation of unsecured debt of over $100,000, they are making regular minimum monthly payments... $2,300 +/month . However, unsecured debt of more than $100,000 in credit cards is nearly impossible to pay back... it may take nearly a million dollars to pay this off with minimum payments. I am not sure what options other than declaring bankruptcy is available to people in situations such as this. I do not condone individuals declaring bankrupts as a way to avoid their debt that they accumulated.............. however, HOW ARE CREDIT CARD COMPANIES ABLE TO CONTINUE TO OFFER CARDS TO BORROWERS WHO CAN NOT CONTRO THEMSELVES AT OUTRAGEOUS  INTEREST RATES???” Thank you... Roland 604-970-0393

OTTAWA — Canadians have become better at making payments on time for their credit cards and auto loans over the last year, according to a report released Tuesday.

Credit analysis firm TransUnion said the credit-card delinquency rate in Canada — measuring the percentage of cardholders late by 90 days or more on payments — fell to 0.34% in the third quarter from 0.38% a year earlier.

The delinquency rate of auto-loan payments declined to 0.11% from 0.15%, TransUnion said.

“There continue to be positive signs in the credit market as Canadians slowly manage out of the recession,” said Thomas Higgins, TransUnion’s vice-president of analytics.

TransUnion said Canada’s “credit-active population” in the third quarter was 24.8 million people, up 0.15% from a year earlier. The average debt, not including mortgage, of someone with credit was $25,163, up 4.3% from last year.

The total amount of debt in the country was up 4.3%, which was deemed as a “modest” gain in comparison to the double-digit increases seen before the recession.

Among provinces, Quebec saw the most year-to-year debt growth at 6.6 per cent, and Manitoba the lowest at 2.6%.

Source: Derek Abma, Financial Post · Tuesday, Nov. 30, 2010

 

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