Delinquency Rate Soars

From the latest report that was obtained from Equifax Canada, the delinquency rate compared to last year has increased severely in the oil manufacturing areas of Saskatchewan, Alberta and Newfoundland and Labrador. The report added to the evidence that a large amount of dismissal in the oil patch is creating a huge problem, making it difficult for debts to be paid off by the consumers.

A discovery was made by the credit reporting agency that the percentage of the delinquency rate of the number of people who are yet to pay their overdue debts has gone up by 22.7 percent in Saskatchewan, 40.3 percent in Alberta and 19.4 percent in Newfoundland and Labrador. In the whole of Canada, the delinquency rate increased by 4.1 percent compared to the previous year. Nevertheless, most consumers are still trying their best to pay off their bills before they hit the delinquent phase.

Despite the rise in the delinquency rate to 1.4 percent in Alberta, it was still a bit lower than three other Maritime Provinces. The senior director working at Equifax Canada, Regina Malina said “(Delinquency rates) are still relatively low, and that has to be kept in perspective, but we are definitely seeing the impact of the prolonged situation in those regions. It looks like it is a fairly persistent situation so we’ll probably see these increases for a while until the region will adjust to the new economic situation.”

Even the amount of employment insurance beneficiaries has gone up to 48 percent in the last year in Alberta, Statistics Canada had this mentioned in their report. Having the delinquency rate highlighted according to age group, the delinquency rate for older people went down even though they added to the debt load than any other age group. They were, however, the only age group to experience a downturn. The younger age group had a different story, as the rate of delinquency soared by 11.7 percent, even though they were the age group with the least debt load. Regina mentioned that “for the most part, older Canadians have always demonstrated an ability to handle their spending and what they owe.”

There is an outstanding amount of $21,878 for the second quarter of the year up 3.4 percent from the same quarter of 2015, which consumers are yet to pay with mortgages not included.