First-time default rates on consumer credit declined in February for the second straight month as nonpayments on second lien mortgages hit a post-recession low.
The Standard & Poor's/Experian consumer default index dipped to 2.09% in February from 2.16% in January and 2.54% a year earlier. First-mortgage defaults fell to 2.02% from 2.08% month-to-month, approaching the lowest rates since the financial crisis seen last summer.
Missed payments on second liens fell to a 1.2% rate according to the index, the lowest level since June 2006.
Defaults on first and second mortgages reached highs of 5.67% and 4.66% in the spring of 2009.
Auto and bank card defaults, the two other sectors measured, dipped as well to 1.22% and 4.41%, respectively, in February.
Four of the five metropolitan areas measured showed a monthly drop in defaults, aside from an increase in Dallas to 1.61% from 1.52%. The Texas metro still registered lowest among New York, Chicago, Los Angeles and Miami. Miami led those cities with a 4.54% default rate.
The S&P/Experian indices date back to July 2004 and measure first-time default rates by a proportion of total balance.