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Consumer debt falls again, led by credit cards

July 8, 2010 |  2:44 pm

Americans continue to pay down debt at a brisk pace, either by choice or because lenders are pulling their credit away.

Total consumer debt outstanding, excluding mortgages, sank $9.1 billion in May to a seasonally adjusted $2.41 trillion, the 15th drop in the last 17 months, the Federal Reserve reported Thursday.

That debt load now has fallen by a net $146 billion, or 5.7%, since the end of 2008.

The May decline was far larger than the $2.3-billion drop expected by economists surveyed by Bloomberg News. What's more, the Fed revised its data for April to show a credit plunge of $14.9 billion for that month. The Fed originally had estimated that consumer debt rose $1 billion in April.

Consumers are paying down their credit cards at a particularly fast pace: Card debt (so-called revolving credit) dropped at a 10.5% annualized rate in May, an acceleration from the 9% pay-down rate of the first quarter.

Non-card debt -- such as auto loans, student loans and other personal loans -- declined at a 1.4% annualized rate in May.

-- Tom Petruno