Bank card delinquencies dropped in the second quarter of 2010, according to the American Bankers Association‘s Consumer Credit Delinquency Bulletin. Consumer past due balances also generally improved on home equity loans and auto loans. The report defines delinquency as an account that is 30 days overdue. The report looks at credit cards that are issued by banks. Bank card delinquencies fell 26 basis points from 3.88% to about 3.6%, below the 15-year average of just under 4%. It’s also the lowest delinquency rate since the first quarter of 2001. ABA Chief Economist James Chessen said two reasons are contributing to the decline. One reason is that banks are continuing to write off unpaid loans. But households are also doing their part to control spending. “Consumers continue to focus on reducing debt levels, using credit cards less and building savings,” Chessen said.  “This is very positive, but the fundamental story is the same: It’s all about jobs. When people don’t have jobs, they can’t pay their bills.” However, the picture in other loan categories was not as rosy. Delinquencies increased in mobile home and marine loans.  Mobile home loan delinquencies rose to about 4%, the highest rate since October 2005.  Marine loan delinquencies rose from the previous quarter to more than 2%. High levels of unemployment, along with slow job growth is contributing to consumer stress, Chessen said. “The economic momentum over the last few quarters seems to be losing steam,” Chessen said. “This will affect job creation and the ability of consumers to pay off debt.” The results were not as broad-based as the previous two quarters and, as a result, the composite ratio was virtually flat, rising just 2 basis points from the first quarter to 3% of all accounts in the second quarter. The second quarter 2010 composite ratio is made up of the following eight closed-end loans that involve fixed repayment periods and regularly scheduled payments:

• Direct auto loan
• Indirect auto loan
• Home equity loan
• Personal loan
• Property improvement loan
• Marine loan delinquencies
• Mobile home loan
• RV loan

Sarah Mueller is an editorial assistant at HousingWire.