Discover says credit card use rose in 2Q

Posted by administrator | 20/06/12 | Tagged Credit Card

Discover says credit card use rose in 2Q
News from Boston.com:

The economic shakeout of the last few years has left credit cards in the hands of more affluent consumers who are better able to pay their bills in full each month, while those with lower credit scores and presumably less ability to pay are now less likely to use credit. Tighter underwriting standards also have pushed loss rates lower.

Discover Financial Services said sales volume on its namesake cards rose 5 percent during the March-to-May period to $ 26.1 billion, reflecting more card use by customers, as total retail sales rose 5.7 percent in the same period according to government figures. Credit card balances also grew nearly 4 percent to $ 46.6 billion, while transactions processed by Discover-owned networks increased 5 percent.

Mark Graf, Discover’s chief financial officer, said in an interview that the growth in credit card sales during the quarter underscores that the company’s core customer has some degree of comfort with spending.

“We feel as though there is, let’s just say, improved confidence more broadly, as exhibited by their willingness to pull their cards out of their wallet,’’ Graf said.

But the rate of consumer spending has stagnated from month to month this spring, while job growth has slowed since the start of the year. Economists worry that consumer spending may further weaken if hiring and pay doe…………… continues on Boston.com

… Read the full article
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Related News:

Discover profit falls as card use rises
News from CBS News:

(AP) LOS ANGELES – Despite concerns about the economy, Discover’s (DFS) customers are using their cards more often and paying their bills on time at record rates.

The company’s profit fell 10 percent in its March-May quarter, as the credit card issuer freed up less money from reserves set aside to cover customers’ unpaid bills than a year earlier as its loans increased.

But credit conditions are improving. Late payment rates and customers’ loan defaults dropped sharply, reaching historic lows. Discover’s management expects that charge-offs, or loans written off as unpaid, will modestly increase over the next 12 months as the company widens its pool of borrowers.

The economic shakeout of the last few years has left credit cards in the hands of more affluent consumers who are better able to pay their bills in full each month, while those with lower credit scores and presumably less ability to pay are now less likely to use credit. Tighter underwriting standards also have pushed loss rates lower.

Watch: Data security breach hits Discover
Government launches credit card complaint database

Discove…………… continues on CBS News

… Read the full article


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Should a Judgment-Proof Debtor Pay Card Debt Anyway?

Posted by administrator | 20/06/12 | Tagged Credit Card Debt

Should a Judgment-Proof Debtor Pay Card Debt Anyway?
News from Fox Business:

Dear Credit Care,

My father is 91 years old and has no assets of any kind other than some furniture and clothing. My mother is 88, blind, and in an advanced state of dementia. They live on Social Security and a small military pension. But they have two credit cards, both of which maxed out sometime ago and on which he has been faithfully paying the minimum payments for several years. One card has an interest rate of 11.9% and the other a rate of 17.9%. What will happen if he just stops paying on these? He does not care about his credit rating, since he does not want to borrow any more. 

-Donna

Dear Donna,

Your father is in a situation known as “judgment proof.” This simply means that because he has no real property or assets and his only income is from Social Security benefits and a military pension, your father’s creditors would likely have no legal recourse to collect a debt from him. So, if he decided to stop making payments on his unsecured credit card debt, he would probably not suffer any financial consequences.

His Social Security benefits and military pension would be exempt from wage garnishment and as long as his benefits are directly deposited into his bank…………… continues on Fox Business

… Read the full article
.

Related News:

5 Smart Strategies for Managing Your Debt
News from TIME:

Consumers have been good about paying down their debt. But they stink at managing what debt remains. Here are five ways to keep control.

Americans are working hard to reduce individual debt burdens. In some cases, unfortunately, we are simply swapping one liability for another, data from the Federal Reserve show—cutting, say, credit card debt while adding education debt. Still, overall our burden is in decline. Consumers have cut debt by $ 100 billion in less than a year, according to the Federal Reserve Bank of New York.

That’s undeniably positive for the personal balance sheets of millions of households. But too often families that cut debt feel they’ve done enough. It’s equally im…………… continues on TIME

… Read the full article


Discover says credit card use rose in 2Q

Posted by administrator | 20/06/12 | Tagged Credit Card

Discover says credit card use rose in 2Q
News from Boston.com:

LOS ANGELES—Despite concerns about the economy, Discover’s customers are using their cards more often and paying their bills on time at record rates.

The company’s profit fell 10 percent in its March-May quarter, as the credit card issuer freed up less money from reserves set aside to cover customers’ unpaid bills than a year earlier as its loans increased.

But credit conditions are improving. Late payment rates and customers’ loan defaults dropped sharply, reaching historic lows. Discover’s management expects that charge-offs, or loans written off as unpaid, will modestly increase over the next 12 months as the company widens its pool of borrowers.

The economic shakeout of the last few years has left credit cards in the hands of more affluent consumers who are better able to pay their bills in full each month, while those with lower credit scores and presumably less ability to pay are now less likely to use credit. Tighter underwriting standards also have pushed loss rates lower.

Discover Financial Services said sales volume on its namesake c…………… continues on Boston.com

… Read the full article
.

Related News:

Discover says credit card use rose in 2Q
News from The Associated Press:

Discover says credit card use rose in 2Q

LOS ANGELES (AP) — Despite concerns about the economy, Discover’s customers are using their cards more often and paying their bills on time at record rates.

The company’s profit fell 10 percent in its March-May quarter, as the credit card issuer freed up less money from reserves set aside to cover customers’ unpaid bills than a year earlier as its loans increased.

But credit conditions are improving. Late payment rates and customers’ loan defaults dropped sharply, reaching historic lows. Discover’s management expects that charge-offs, or loans written off as unpaid, will modestly increase over the next 12 months as the company widens its pool of borrowers.

The economic shakeout of the last few years has left credit cards in the hands of more affluent consumers who are better able to pay their bills in full each month, while those with lower credit scores and presumably less ability to pay are now less likely to use credit. Tighter underwriting standards also have pushed loss rates lower.

Discover Financial Services said sales volume on its namesake cards rose 5 percent during the March-to-May period to $ 26.1 billion, reflecting more card use by customers, as total retail sa…………… continues on The Associated Press

… Read the full article


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