NEW YORK (CNNMoney.com) -- The amount of credit card debt consumers are carrying dropped to an eight-year low and delinquencies continued to decline in the second quarter as consumers looked to shore up their savings.
Credit card debt fell 4.1% to an average $4,591 during the quarter, according to credit bureau TransUnion. That marks the fifth straight quarter of declines and the first time credit card debt has dipped below $5,000 since the first quarter of 2002, according to TransUnion.
"Consumers continue to pay down their credit cards in response to economic uncertainty and high unemployment," said Ezra Becker, director of consulting and strategy at TransUnion's financial services unit.
Credit card delinquencies, which measure the percentage of debtors who are at least 90 days late in making payments, also continued to slide, to a mere 0.92% . That's down a whopping 21.3% from the prior year and 17.1% from the prior quarter. Both are the biggest decreases since the recession began at the end of 2007, said Becker.
State by state: The state with the highest average credit card debt was Alaska, at $7,148, followed by Tennessee, at $5,654, and Hawaii, at $5,594.
Alaska was one of the few places where credit card debt increased quarter over quarter, along with Washington, D.C., and Oklahoma.
Alaska was also the only state to show an increase in credit card delinquency, with a gain of 7.4%. But Nevada had the highest incidence of credit card delinquency, at 1.5%.
Iowa and Alabama fared the best, with Iowa logging the lowest credit card debt in the nation, at $3,792. But Alabama took the prize for the biggest decrease in quarter-over-quarter credit card debt, with a decline of 22.4%.
While the nation's capital saw an increase in credit card debt, it also saw the largest quarter-over-quarter drop in delinquency rates, with a decline of 28.2%.
In another sign of consumers' distaste for credit card debt, fewer people are signing up for new cards. The number of new credit cards declined 6.5% year-to-year, according to TransUnion.
TransUnion's report comes just days after Synovate, the market research arm of Aegis Group, announced that credit card interest rates are on the rise.
The average interest rate on existing cards jumped to 14.7% last quarter, up from 13.1% a year earlier, said Synovate.
The increase in rates has been partly attributed to the Credit Card Accountability, Responsibility and Disclosure (CARD) Act of 2009. The legislation, which placed new restrictions on credit card interest rates and fees, gave credit card companies a limited time to hike rates.
For-profit Corinthian College network is shutting its remaining 28 ground campuses effective today. More
A major earthquake was the last thing Nepal needed. Even before one of the country's major fault lines rumbled to life, the country was beset by challenges. More
A Girl Scouts Cookie Oven rolling out to Wal-Mart, Target, Kmart stores this summer will let you bake those iconic thin mints right at home. More
Imagine having a three-day weekend every week and being paid the same full-time salary. It can be done if your employer offers you the option of a compressed workweek. More