First Quarter Credit Usage Shot Up 50%, with Overspending Limits and Late Payments also Increasing, According to Credit Market Analysis by ScoreSense
DALLAS, May 19, 2022 /PRNewswire/ — Thirty percent of consumers planning to buy a home this year changed their plans due to the economy or their personal budgets, including 7% whose credit scores are not high enough to qualify, according to a consumer survey by ScoreSense®, a credit score monitoring product. The survey findings, revealed in the “ScoreSense Market Report: Survey of Prospective Home Buyer Behavior and Credit Outlook Analysis,” focused on consumers’ plans – on track or changed – for buying a home this year, as well as an analysis of consumer spending and credit activity for the first quarter of 2022.
The analysis of consumer spending and credit, which compared the first quarter of 2022 to the same period in 2021, revealed:
- Credit card usage has skyrocketed, up 49%. Consumers also are overspending credit limits, up 30%.
- Delinquent accounts – late payments 30 days to 180 days – shot up 27%.
- Major derogatory alerts – late payments of 180 days or more, including collections, repossessions, and foreclosures — dropped 17%.
- New trade accounts (Open New Account) are up 7%; however, new inquiries are down 17%.
The consumer survey by ScoreSense, focused on consumers’ plans to buy a new home this year, revealed:
- Going into 2022, nearly one out four people who planned to buy a home this year are now undecided.
- Nearly 30% of the respondents said the economy or personal budget changed their plans.
- Inflation was the top reason that could influence consumers not to buy a house this year, but 7% of respondents said it was their credit score.
- Finding an affordable home is the most concerning factor for consumers.
“Looking at our analysis of credit behavior for the first quarter of this year and further back to last fall, we’re concerned many consumers under financial duress will continue to increasingly use credit to pay for ‘ordinary’ things, such as groceries and gasoline, and hold that debt instead of paying it off at the end of the month,” said Carlos Medina, senior vice president at One Technologies, LLC., which offers ScoreSense. “We’re highly concerned that late payments and overdue payments that go to collections may increase as well. Lastly, credit scores always matter, but we can see how important good credit is now with lenders tightening loan restrictions, as evidenced in our homebuying survey that revealed many consumers are worried their credit scores are no longer high enough to qualify for a mortgage.”
ScoreSense serves as a one-stop digital resource where consumers can access credit scores and reports from all three main credit bureaus—TransUnion®, Equifax®, and Experian®—and understand what is most affecting their credit.
About One Technologies
One Technologies, LLC, harnesses the power of technology, analytics, and its people to create solutions that empower consumers to make more informed decisions about their financial lives. The firm’s consumer credit products include ScoreSense®, which enables members to seamlessly access, interact with, and understand their credit profiles from all three main bureaus using a single application. The ScoreSense platform is continually updated to give members deeper insights, personalized tools and one-on-one customer care support that can help them make the most sense of their credit. One Technologies is headquartered in Dallas and was established in October 2000. For more information, please visit onetechnologies.net.
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