A new TransUnion study has revealed that paying credit card debts is a lower priority than automobile and mortgage debts for most US consumers.
Ezra Becker, vice-president of research and consulting for TransUnion, said that consumers prioritise their auto loans to protect their access to transportation which is key to many parts of their lives.
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"After all, you might need a car to make sure you keep whatever employment you have or to help getting one," she said.
During the recession that started in 2008, TransUnion researchers observed a shift in payment priority. Financially stressed consumers were more likely to pay their credit card bills before mortgages.
In September 2004, credit card delinquency stood at 2.25%, against 1.26% for mortgages. In September 2008, delinquencies on credit cards rose to 3.29%, but came in behind the 3.32% of mortgage delinquencies.
By September 2013, however, while auto loan delinquency remained the lowest at 0.89%, credit card delinquency increased to 1.86% and mortgage delinquency decreased to 1.79%.
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By GlobalData"Though by September 2013, consumers returned to paying mortgages before credit card debt," said Ezra Becker.
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