Creditnet News Story
Consumers continue paying off credit cards
Friday, November 6, 2009
By William Davis
The Federal Reserve noted that the amount of revolving consumer credit decreased during September.
Consumers are taking measures in order to improve their credit score, at least according to statistics released by the Federal Reserve.
Revolving consumer credit, a large majority of which is credit card debt, saw a drop in September, which means more people are trying to pay off debts associated with plastic. Revolving credit fell at an annual rate of 13.3 percent during the month, which continues a pattern of falling consumer credit seen since the fourth quarter of 2008.
For consumers, one of the upsides of paying off credit card debt is a better credit-utilization ratio. Having a wider gap between the amount of credit a person uses and their available credit plays into determining a credit score.
Along with revolving credit, the overall amount of debt consumers carry fell, according to the Fed. Total consumer credit dropped by more than $14.8 billion between August and September. For the third quarter, consumer credit decreased at an annual rate of about 6 percent.
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