Debt levels, delinquent borrowers fall in second quarter

As a result of a declining rate of delinquent borrowers and lower debt levels, management agency TransUnion recently lowered its Credit Risk Index for the sixth consecutive quarter.

Between April and June, the CRI fell to 121.22, nearly a 2 percent decrease compared to the same three-month span in 2010.

Chet Wiermanski, global chief scientist for TransUnion, stated the falling rate has led to a loosening of lending restrictions.

"The lengthy, broad and steady decline in the Credit Risk Index, which reflects declines in consumer delinquency and debt levels, has placed the consumer credit market on a firmer footing," said Wiermanski. "This responsible use of credit has given some lenders confidence to ease lending standards and invest more in the acquisition of new credit customers."

The second quarter of 2011 marks the third straight quarter in which 48 states registered appreciable declines in their credit risk indices, according to the report. Massachusetts and Vermont were the only states that didn't experience a decline of at least 0.76 percentage points.

The CRI may have also fallen as a result of more people taking advantage of credit repair companies. These services can help consumers get back on their feet by identifying marks that drop a score, which makes borrowing a more costly endeavor.