Overdue U.S. Home-Equity Credit Lines Rise Most Since 1987 (Hugh Son)

Created by : Francis Goodwin View profile

July 2 (Bloomberg) -- Consumers fell behind on loans secured by their homes at the fastest pace in two decades in the first quarter, signaling deeper distress in the U.S. economy, the American Bankers Association reported.

Home-equity lines of credit at least 30 days past due rose 14 basis points to 1.1 percent of accounts for the quarter, the Washington-based group said today in a statement. Delinquent credit-card accounts increased 13 basis points to 4.51 percent, the highest level since 2006.

``People are looking for any source of funds to pay their daily expenses,'' Carol Kaplan, spokeswoman for the bankers' group, said yesterday in an interview. ``It's a sign of the overall condition of the economy that people are having trouble making their payments.''

Consumers squeezed by higher food and fuel prices are tapping revolving credit lines to stay afloat as the economy slows. The U.S. lost 49,000 jobs in May, the fifth straight monthly decline, and the unemployment rate rose to 5.5 percent, the biggest jump in than two decades.