Consumers Pay Credit Card Before Mortgage

It appears consumers are more interested in keeping up to date on their credit card payments than their mortgage payment, though it’s likely that staying current on the credit card is an easier endeavor than making a costly mortgage payment each month.

According to Capital One Chief Executive Richard Fairbank, roughly two-thirds of Capital One customers who are 90 days or more delinquent on their mortgage are still current on their credit cards.

Capital One defines “current” as making at least the minimum payment each month to avoid late fees and related charges.

Fairbank noted that the percentage of consumers who were current on their credit card but late on their mortgage fell from 70% in the third-quarter.

The news is likely a sign that consumers are having difficulty paying both their mortgage and their credit card(s), as financing options become more difficult.

Homeowners who may have refinanced their homes in the past to pay off credit card balances and other bills likely have no place to turn, and may begin defaulting on credit card payments as well.

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