Consumers Choosing To Pay Credit Cards Over Mortgages, Report Finds

businessinsider.com:

Credit history company TransUnion has found that Americans are shifting their priorities when it comes to paying down debt.

Consumers are paying down their credit cards while ignoring their mortgage payments.

Read the whole story: businessinsider.com

Comments

[realitytrumpsbull]

12:54 AM on 03/02/2010

This is actually smart, because paying down your cards does two things: It honors the lending agreement that you signed, and it also gives you something for emergencies such as losing your job or your house and needing short-term cash to keep moving in life. It also enables you to get to a point where you don't have to make credit card payments anymore, because you don't owe the credit card companies any more money and can then close the account. If you can't afford the item the first time, how many times will you end up buying it through interest payments?

[dermguru]

06:17 PM on 02/08/2010

welcome to the new world.....the "fine upstanding" Tishman Speyer set the example....they CHOSE to default on their multi-billion dollar mortgage with Peter-Cooper Village....there is NOT one bank that should be surprised or complain when everyhomeowner that is in a negative-equity position follows the Tishman Speyer example.....and btw Hank...don't you EVER patronize the individual citizen saying they "should honor their responsibilities with their mortgages" when your corporate cronies take such an egregious act..... it was you and yours who created this entire worldwide disaster....do the world a favor and shut your mouth unless you're willing to take your share of personal responsibility!
THANKS FOR THE PRECEDENT Tishman Speyer.....we'll all follow your lead.

[Tom95134]

03:30 PM on 02/07/2010

Paying off credit cards instead of making a few mortgage payments is the smart thing to do.

Penalties and interest on credit cards, even though the monthly payments may be relatively small, clearly outweigh any penalties and accumulated interest you would get hit with by missing a mortgage payment. Besides, mortgage holders are the most likely to "look the other way" for at least a couple of months. They already have enough foreclosed properties they can't sell and don't want any more.

[Tiggy]

01:03 PM on 02/05/2010

That would be because credit cards can't be part of Bankruptcy thanks to our citizen friendly representatives in Washington....but like the thieves in the banking industry...people found a loop hole...it's called walk away from the mortgage.

[Patriot86]

01:23 PM on 02/05/2010

Not true...credit cards are wiped out in bankruptcy...it is in sane to pay credit cards instead of your mort gage....they can come after you.

[Tiggy]

02:03 PM on 02/05/2010

you can surrender the house and not impact your credit. you loose what you have in it...but you retain your credit. if they foreclose...well that is another matter.

The provisions on CC debt has changed...Credit card debt may be non dischargeable in bankruptcy under either of two legal theories:

The application submitted to get the card was fraudulent
The card was used without an intent to repay; this is far more common

It can be wiped if certain conditions are met...most of which are impossible to meet.

[stargazer13]

11:43 AM on 02/05/2010

I am one of these consumers who is choosing to do this because unemployment is not enough to pay house payment I get 300 a week house payment is 1500,00 a month ! so no help there in saving my house I can make the min payment on my CCards .
!

it,s not much ! but I do believe in paying my bills when I have money ! and am doing the best I can !!

with the unemployment checks I get ! My husband and I are in our fifty,s and this financially engineered crises has broke us in more ways then one !! and I do keep repeating to my self I am in good company
so as not to feel alone in all this mess !

I all so tell my husband regularly husband our happiness is not tied to this house ! to help him feel better about the things beyond our control ! we had enough saving to last nine months paying all our bills
it is now gone all of it ! we have now been out of work for 13 months just got approved for unemployment benefits this Nov went nine months on saving can not keep it together just can not !!

every one we know including family members our children we are all out of work ! I have never seen it this bad never !! some thing has to give !! it just has to !!

[demma]

01:27 PM on 02/05/2010

I am sorry for all you have been through. FYI- my mom who is 59 yrs old got laid off in 2009- took a $30,000 pay cut and had to take some remedial job that was quite beneath her. My mom was the primary breadwinner in my family. My dad makes alot less then her. Her job loss cost her most of her 401k and whatever else they had tucked aside.
She qualified for her mortgage payment to be modified. She was paying $1400/mo and now its only $800/mo. She will owe on the house though until she's in her eighties. But she saved her house. She went through Citifinancial and the used the "Obama Plan" that everyone loves to hate.Granted, I don't like the fact that she had to extend her mortgage but she saved her house and a really bad financial situation from happening