Credit Card Charges Down But Bad Credit People May Pick Cards Over Equity Loans
In a survey taken by TransUnion, 30% of consumers claimed their current balance of credit card charges is the same as this time last year, while 42% report their charges are actually less. This means only 11% may have spent more, down from 14% last year.
Recession warning?
Although these figures may not reflect a drastic change from last year, it may indicate a trend that could lead to recession.
Mortgage influence?
Last year many consumers; even bad credit people, were still able to take advantage of home equity loans. But now with the credit crisis, more may be forced to pay for charges using a credit card which carries much higher interest rates, particularly those with subprime, poor credit.
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Credit Tip: Need a high limit for Christmas credit card charges? If you have bad credit, consider a personal loan by refinancing your mortgage. Even if you have cash to buy Christmas presents, we recommend using a prepaid card to make purchases because it's safer than carrying cash.
