Another sign of the times…
U.S. consumers seem to be more interested in paying their credit cards than making their monthly mortgage payments, according to a new survey from Cardbeat/Auriemma Consulting Group (ACG).
In previous years, consumers had always said the mortgage is the bill they would pay first, but now credit cards have grabbed the top spot.
“ACG believes that this change is driven by two market trends,” said Nancy Stahl, editor of Cardbeat, in a release. “First, credit has become tighter. Issuers have cut credit lines, and cardholders are aware that missed or late payments can trigger rate increases or account closure.”
Stahl noted that cash-strapped consumers view credit cards as their “lifeline” to manage everyday expenses, while adding that foreclosures have become commonplace.
“Intense media coverage of the housing crisis and of legislative efforts to assist homeowners who fall behind may be swaying borrowers toward the conclusion that it’s more important to be current on their credit card than on their mortgage.”
In a way it makes sense; consumers rely on credit cards for daily purchases, and they certainly don’t want to lose that capacity to spend, especially during the holidays.
At the same time, many seem to be giving up on the mortgage, either because they’re deeply underwater, unemployed, hopeless, or perhaps because they’re banking on government aid.
The data from the survey, conducted in October, is based on 430 credit card users.