Figures from the Federal Reserve suggest that a worrying number of consumers in Virginia and around the country are finding it difficult to make their credit card payments on time despite a robust economy and low unemployment. The credit card delinquency rate in the United States now stands at an alarming 2.47 percent. That figure was 2.42 percent at the beginning of 2017 and 2.12 percent in early 2015. This means that about $23 billion in this type of revolving debt is currently 30 or more days past due.
Just as concerning for economists is the reasons why many Americans are not paying their credit card bills on time. An online survey of 2,019 consumers conducted by the financial information and advice website NerdWallet revealed that almost two-thirds of those with delinquent revolving debt fell behind because they simply did not have enough money to make their minimum monthly payments. A third said that they needed the money to pay for essentials and 32 percent put the blame on an emergency or unexpected expense.
The costs of missing credit card payments can be steep. In addition to charging late fees, credit card companies may impose higher rates of interest when accounts fall more than 60 days past due. These penalty rates are often as high as 29.99 percent, and they generally remain in place for at least six months even if consumers bring their accounts up to date.
Those unable to make their monthly credit card payments must also contend with almost daily calls from lenders and debt collection companies, and the tactics they employ sometimes border on harassment. Attorneys with experience in debt relief cases could explain that filing for bankruptcy generates an automatic stay that puts at least a temporary end to collection efforts, wage garnishments and asset seizures.