Consumer loan delinquencies dropped to their lowest mark in nearly six years during the second quarter ended June 30 as households favored debt service over spending increases, according to the American Bankers Association.

Delinquencies on bank card debt fell from 3.08 percent of all accounts in the first quarter to an 11-year low of 2.93 percent, and well below the 15-year average of 3.91 percent, the ABA reported in its Consumer Credit Delinquency Bulletin. The ABA defines a delinquency as a payment that is 30 days or more overdue.

Delinquencies in eight loan categories fell a total of 11 basis points to 2.24 percent of all accounts in the second quarter, the best showing since the fourth quarter of 2006, when the rate was 2.23 percent. The rate has now been below the 15- year average of 2.40 percent for two consecutive quarters.

“Consumers are saving more and borrowing less as they work to pay down debt at a faster rate,” James Chessen, ABA's chief economist, said in a statement. “Economic uncertainty has made consumers hesitant to take on new debt, and building a stronger financial base has become a priority.”

The widespread decline masked a rise in delinquencies in some categories, including home equity loans and lines of credit, and direct auto loans. Home equity loan delinquencies rose 9 basis points to 4.09 percent over the first quarter, while those for lines of credit spiked 13 basis points to 1.91 percent, and direct auto loans climbed 6 basis points to 2.34 percent.

“The lack of broad-based improvement gives us pause about the future,” Chessen said. “The economy experienced turbulence in the second quarter. Slow job growth and continued uncertainty means many consumers will face challenges managing their debt going forward.”

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