Chicago Relocation

Credit card v. mortgage payment – Some surprising information

February 14, 2010

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A recent report by TransUnion, the credit-scoring giant, has some stunning information that really helps crystalize the way many people look at their homes today.  According to TU, since the recession really got going, the old concept of “mortgage payment first, credit and other payments second” has gone tipsy turvey – People are paying the credit card payment and THEN, if there is anything left over, they are paying their mortgage.  A “hierarchy reversal” as they call it.

Does that mean that people no longer care if they lose their home; that their concern is more about keeping available credit open; or that they don’t see logic paying down an asset that is worth less than the balance?  Whatever the reason, TU predicts that this is a temporary change, and the world will go back to normal as we come out of this economic climate.  For the sake of Chicago real estate, we hope that happens soon!

Still…..interesting food for thought!



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