Default rate falls across numerous fields

Research from Standard & Poor's and Experian has found that the default rate has slipped in numerous industries, providing another sign of economic improvement among consumers. Auto lending, credit card and mortgages - including first and second month defaults - all declined from the previous month's rates. Second mortgage defaults fell by the greatest amount, receding more than 13 percent from December levels, down to slightly more than 1.5 percent. Meanwhile, first month mortgage default rates dipped by about 2.6 percent for the month, landing at 2.8 percent of all outstanding loans. "We continue to see improvements in consumers' financial condition," said David Blitzer, chairman of the S&P Index Committee. "Default rates fell sharply in all major categories." Auto industry lending experienced a nearly 6.6 percent decline in default rates since the final month of 2010, settling at approximately 1.6 percent overall. As for credit cards, the default rate dropped nearly 8.8 percent, down to 6.1 percent overall. "Two keys to the economic recovery are rebuilding balance sheets and increased spending. The reduced default rates seen here demonstrate that household balance sheets are being put back into shape and should support gains in spending," Blitzer said.