Mortgage, Credit Card Debts Down in Arkansas; Auto Loan Debt Rises

In a trend that was seen across the country, Arkansas residents reduced mortgage and credit card debts, but increased auto loan debts in the last quarter of 2013.

According to the Federal Reserve Bank of St. Louis’ "Burgundy Book" report, mortgage debts were down 3.5 percent and credit card debts dropped 4.5 percent during the fourth quarter in 2013. In the same period, auto loan debts increased 4.9 percent. 

In the Little Rock Zone, which covers all of Arkansas except the northeast region, mortgage debts declined 3.2 percent, while credit card debts were down 4.6 percent. Auto loan debts rose 5.1 percent. Nationally, mortgage debts were down 4.8 percent and credit card debts 4.9 percent. Auto loan debts creeped up 4.4 percent.

Business contacts said the increase in auto loan debts was blamed on "an environment of easy auto credit with aggressive subprime lending," according to the report. Also, car sales were "solid overall" in December and January. 

"We have a large group of lower income wage earners in our area," one Little Rock area auto dealer said in the report. "They are less likely to be able to purchase vehicles at today's prices."

In both Arkansas and the U.S., 90-plus day delinquency rates were up across the board.

In Arkansas, mortgage delinquency rates rose 2.2 percent, compared to 3.5 percent nationwide. Credit card delinquency was up 8.1 percent in the state, while it rose 9.1 percent across the country. Auto loan delinquency was up 2.3 percent in Arkansas, and 3.2 percent in the U.S.