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  1. #1
    Join Date
    Jan 2008
    Location
    Christchurch
    Posts
    179

    Default Credit Cards Could Become Next Trouble Spot in Crisis

    Quote from CNBC Article (http://www.cnbc.com/id/27181200)

    "Credit-card delinquencies are likely to become the next flashpoint in the credit crisis, though the impact on the overall economy won't be as severe as the housing slump, analysts believe."

    “Now with their home equities getting shut off, people are going to start augmenting their income with their credit cards," DeCastro says. "They are going hit their limits and once they hit their limits, then they are probably going to walk away from their credit cards.”


    I would be interested to hear peoples thoughts whether you have noticed an increase in tenants struggling to make rent payments?

    We have noticed a slight increase in automatic payments being defaulted. Guessing a few tenants are struggling with cashflow with very poor financial skills/discipline combining with higher living costs? My guess is that a proportion are using their credit cards to improve their cashflow.

    So are we going to see a noticable increase in tenants reaching their credit limits and getting themselves in a hole?

    Jono

  2. #2
    Join Date
    Oct 2008
    Location
    Auckland/Melbourne/ whereever the money is
    Posts
    1,380

    Default

    I am seeing more late payments from my tenants, even the ones that used to be regular as clockwork.

    Credit cards definitely being used as short term finance, the killer is when they can't be paid back in a short period & interest is 22% !

  3. #3

    Default

    Be interesting to see how much extra pressure Christmas expenses add to things, it's traditionally been a hard time of year on budgets. While I imagine retail spending will be reduced I'm still expecting to see a bunch of conditioned spending based off past expectations regardless of whether it's a good idea for many or not.

  4. #4
    Join Date
    Jan 2008
    Location
    Christchurch
    Posts
    179

    Exclamation Consumer credit market slows to four-year low

    NZ Herald
    Consumer credit market slows to four-year low

    Demand for credit is the lowest since 2004 and defaults have almost doubled in that time, credit information provider Veda Advantage says.

    Consumer defaults rose 18 per cent in the year-to-date compared to the same period last year, and defaults in the month of September are up 24 per cent on September last year.

    "The big increase in defaults for the month of September is perhaps a harbinger of what's to come," Mr Roberts said.

    "The overall decline in applications for credit, with the exception of credit cards, reflects the wariness people have of burdening themselves with additional debt in the current climate.

    "We are also witnessing increasing numbers of people turning to the revolving lines of credit offered by credit cards as a means of staving off other debts."

    NZ Herald Article
    http://www.nzherald.co.nz/nz/news/ar...ectid=10537830

  5. #5
    Join Date
    Mar 2008
    Location
    Auckland Wide
    Posts
    1,244

    Default

    when you think about it just paying the interest means that every five clients cover the balance of one
    Hamish Patel | ph: 09 625 4693 | mob: 021 625 693
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