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Experian study finds that consumers are paying less on monthly payments than three years ago

 

 Experian study finds that consumers are paying less  
on monthly payments than three years ago 

Of the top 25 metropolitan areas, Washington D.C. residents are currently paying the most each month, while Pittsburghers are paying the least

Costa Mesa, Calif., Nov. 11, 2010 — Experian®, the leading global information services company, released its insights today on average monthly payments* of the top 25 metropolitan areas.  The study found that nationally, consumers are paying $903 per month on their bills, which could include a combination of credit cards, auto loans and leases, and mortgages—a decrease of two percent in the last three years. 

The study also reveals that Washington D.C., Seattle and Baltimore top the list with the highest average monthly payments with Washington D.C. coming in at 42 percent higher than the national average.  Cities with the lowest payments include Cleveland, Tampa and Pittsburgh. 
 
Results ranked by highest to lowest by average monthly payment amounts are detailed below:

Metropolitan area Average monthly payment Difference from national average
1.    Washington, D.C.         $1,285         42%
2.    Seattle         $1,135         26%
3.    Baltimore         $1,133         25%
4.    Boston         $1,133         22%
5.    Denver             $1,104         22%
6.    San Francisco         $1,098         22%
7.    San Diego         $1,076         19%
8.    Sacramento         $1,045         16%
9.    Los Angeles         $1,024         13%
10.  Chicago         $1,017         13%
11.  Philadelphia         $1,011         12%
       Minneapolis         $1,011         12%
12.  New York         $989         10%
13.  Atlanta         $986         9%
14.  Dallas         $970         7%
15.  Phoenix         $957         6%
16.  Portland         $948         5%
17.  Cincinnati         $920         2%
18.  Houston         $889         -2% 
19.  Columbus         $888         -2%
20.  St. Louis         $886         -2%
21.  Miami         $867         -4%
22.  Detroit         $832         -8%
23.  Cleveland         $812         -10%
24.  Tampa         $791         -12%
25.  Pittsburgh         $763         -16%

*Average monthly payment amounts were calculated using mortgage loan/line of credit, auto loan/lease, other types of installment loans, as well as revolving accounts, but not necessarily a combination of all for each consumer.

 

“The trend we’re seeing is that consumers have lower payments, indicating both proactive deleveraging by consumers and tighter limits from lenders and certainly consumers are making fewer major purchases such as homes and cars than they were a few years ago,” said Michele Raneri, senior director of analytics, Experian. “There are many ways to manage and develop a positive credit score and good payment habits.  Paying bills on time is generally the single most important contributor.”

Below are some tips to take into consideration when making a major purchase:

• Get your credit report.  Before approving your request for a home loan, mortgage lenders review your credit report. If you review your credit report in advance, you’ll see yourself from a lender’s perspective.

• Be prepared. When lenders review your credit report, they evaluate how much you already owe, how much unused credit you have available, how prompt you are in paying your debts and whether you’ve recently applied for new credit.

 Count your savings. To buy a house, you generally need a down payment in the range of 5 percent to 20 percent of your new home’s purchase price, depending on your credit risk. You also need money for closing costs and be sure to set aside extra funds for emergencies. If you spend everything on your down payment, you’re statistically more likely to lose your new home to foreclosure sometime in the future.

 Make your payments. How much you borrow, how much you owe and when you pay become a part of your credit history. When you apply for new credit purchases, other lenders will review this history. Late payments can stay on your credit report for up to seven years, can keep you from buying another house or can make it more expensive to buy a car. A good credit history proves that you manage your finances well. It lets you enjoy using credit at your convenience and at a lower cost.

For more information on managing credit, visit http://www.experian.com/credit-education/credit-information.html.

For more information on average debt levels per consumer in the top 20 metropolitan areas and credit card trends please see Experian’s previous studies, Experian ranks top 20 major US metropolitan areas by average debt per consumer and Experian provides insight into credit card trends of the top 20 major metropolitan areas.
    
Methodology
The data was pulled and analyzed by Experian Decision Sciences using a statistically relevant sampling of Experian’s File OneSM consumer credit database. Credit files analyzed had all personal identification information removed. They then were filtered through Premier AttributesSM, the credit industry’s most robust, accurate and comprehensive set of credit 

attributes that provides consumer data at the most granular level, facilitating enhanced modeling opportunities. Experian’s credit study data score averages are based on VantageScore®.

Contact:
Kristine Snyder 
Experian Public Relations
1 714 830 5192
kristine.snyder@experian.com

About Experian
Experian is the leading global information services company, providing data and analytical tools to clients in more than 90 countries. The company helps businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. Experian also helps individuals to check their credit report and credit score and protect against identity theft.

Experian plc is listed on the London Stock Exchange (EXPN) and is a constituent of the FTSE 100 index. Total revenue for the year ended March 31, 2010, was $3.9 billion.
Experian employs approximately 15,000 people in 40 countries and has its corporate headquarters in Dublin, Ireland, with operational headquarters in Nottingham, UK; Costa Mesa, California; and São Paulo, Brazil.

For more information, visit http://www.experianplc.com.


Experian and the Experian marks used herein are service marks or registered trademarks of Experian Information Solutions, Inc. Other product and company names mentioned herein are the property of their respective owners.

VantageScore® is owned by VantageScore Solutions, LLC.