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Capital One credit card charge-offs increase | Business

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Capital One credit card charge-offs increase
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Local credit giant Capital One (based in McLean, VA) has stated that its rate of uncollectible credit card balances increased in the third quarter. Initially, it seemed that consumers were showing progress in paying credit card bills, but with the rate of unemployment continuing to climb, consumers are concentrating on major bill payments such as mortgage and automobile payments.

Charge offs for Capital One have increased from $366.8 million to 368 million continuing to show that consumers are still under stress and enduring financial hardships. It has been noted that while consumers are attempting to make payments on their credit card debt, they are still delinquent in their payments.

It has been found that consumers are using credit cards for basic needs such as groceries, gas and prescription drug purchases. In addition, most consumers are carrying at least $10,000 in credit card debt and have at least 5 credit cards.

Credit card companies typically write off loans after they are 180 days past due (6 months) the point at which it is assumed the balances won't be collected.

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