Q4 2025 Credit Card Charge-Offs Continue to Show Signs of Stabilizing at an Elevated Level
Joel Rosenthal, VP Credit Collections Business Development & Client Relations
ProVest
In the fourth quarter of 2025, credit card charge-offs and delinquency rates—often viewed as an early indicator of future charge-offs—declined very slightly. More significantly both metrics continue to show stabilization at an elevated level historically.
Newly released data from the Federal Reserve shows credit card charge-offs slipping from 4.07% to 4.03%. While the decline is minimal, it reinforces the view that charge-offs are stabilizing at an historically high level compared with the past 10 to 15 year period.
Charge-Off Rate on Credit Card Loans
Because legal placement activity typically follows charge-off trends with a lag of roughly nine to twelve months, volumes are expected to stay elevated far into 2026.
Delinquency Data — The Early Indicator (6–9 Month Lead Time)
Credit card delinquency rates—commonly the earliest indicator for upcoming charge-off movement—also edged down slightly, decreasing from 2.87% to 2.84%.
Over the past five quarters, delinquency levels have remained within a tight 15-basis point range. Although recent trend has been slightly downward, the broader picture reflects stabilization at historically high levels in the past 15 years.
Broader Consumer Credit Conditions Remain Pressured
Across all major credit categories, aggregate delinquency rates increased slightly in Q4 2025. By the end of December, 4.8% of outstanding household debt was in some stage of delinquency, up 30 basis points from the previous quarter. Early-stage delinquency transitions rose modestly for mortgages and more sharply for student loans, while remaining largely steady for auto loans, credit cards and home equity lines of credit.
Overall, while credit card metrics show signs of leveling off, broader household credit conditions suggest financial stress remains present across the consumer landscape.
By: Joel Rosenthal | ProVest
VP Credit Collections Business Development & Client Relations
Joel.Rosenthal@provest.us | (561) 312-7602
About ProVest
ProVest plays a critical role in the legal process by ensuring that defendants in a legal action have been properly served. The company specializes in managing service of process related to creditors’ rights and mortgage defaults, serving millions of documents annually for leading law firms, financial institutions, and insurers. Learn more at www.provest.com.