Consumer loan delinquencies on the rise in Utah, U.S.

If consumer loan delinquencies are any indication, Utahns increasingly are feeling the ill effects of the nation's continuing recession.

Consumer loan delinquencies in Utah hit 3 percent during the first quarter of 2009, a marked deterioration over the 1 percent delinquency rate experienced in the same quarter a year ago, according to the Utah League of Credit Unions.

"We're now seeing consumer loan delinquency rates similar to the levels being reported nationally, although for a time we were lagging those numbers," said Scott Simpson, president of the Utah League, which represents 99 of the 102 credit unions operating in the state.

Consumer loan delinquencies reported by the nation's banks also edged up to another record high in the first quarter, according to data released Tuesday by the American Bankers Association.

In its latest consumer credit delinquency bulletin, the ABA reported the composite delinquency rate among eight types of closed-end installment loans rose to 3.23 percent in the January-March period.

And that was the highest recorded delinquency rate since the ABA began tracking the number in the mid-1970s and topped the previous record of 3.22 percent set in the last quarter of 2008.

The ABA defines a delinquent loan as one where a payment is more than 30 days past due, while the Utah League of Credit Unions uses 60 days.

Preston Cochrane, president of AAA Fair Credit Foundation in Salt Lake

City, said the continuing rise in unemployment in Utah and nationally is one of the main drivers of rising consumer loan delinquencies.

The Utah Department of Workforce Services reported there were 74,800 Utahns unemployed in May, the last month for which data is available. And that pushed the state's unemployment rate to 5.4 percent from 5.2 percent.

Nationally, the unemployment rate now stands at 9.5 percent, a 26-year high.

"When people lose their jobs or have their hours cut back it gets harder for them to pay their bills," Cochrane said, nothing that AAA is seeing a record number of Utahns coming for credit counseling who are behind on every category of consumer loans.

The ABA's composite delinquency rate incorporates payments data on auto, personal, home equity, home improvement, recreational vehicle, mobile home and marine loans. It excludes credit card delinquencies because they are considered open-end revolving credit lines.

Still, the ABA said credit card delinquencies also moved higher, rising to 4.75 percent in the latest quarter from 4.52 percent in the fourth quarter last year. The credit card delinquency rate nearly reached the record high of 4.81 percent set in the second quarter of 2005.

steve@sltrib.com