First housing, next credit cards?

The credit crunch has the possibility to expand, so suggests Reuters:

The problem with using credit cards — with their high interest rates — to stave off default brought on by “reset” adjustable mortgage interest is that it merely postpones an inevitable crisis, said Gregary Brown, social policy director at Metropolitan Family Services in Chicago.

“Our biggest concern right now is that there are lot of people who will face a choice between bankruptcy or foreclosure,” he said. “Either way, it’s going to suck.”

There’s no doubt that the general population has a tendency to offset problems to a later date. I just worry we might see an implosion in the credit card market with increasing delinquency rates. This may lead to credit lenders tightening the reins, and the profit margin, which could mean less discounts and award schemes for consumers.   I hope not, because wise credit card use is a great way to recover losses in fees from financial institutions.