ISLANDIA, N.Y., May 7 /PRNewswire/ -- Only 8% of Americans plan to refinance their mortgage
in the next year, down 50% from the 16% who anticipated refinancing in October 2002, according
to the Cambridge Consumer Credit Index.  Of those surveyed, 35% have refinanced in the past
two years, up from 24% who had done so in 2002.  57% of Americans have not refinanced and
have no intentions to do so, down slightly from 60% in 2002.

The Cambridge Consumer Credit Index survey also asked respondents what they planned on doing
with the money saved from refinancing. The largest percentage, 30%, (up from 23% in October 2002)
planned to use the money to pay off non-credit card debt such as car and student loans. 23% (down
from 31%) of the respondents planned to increase their savings.  22% (up from 20%) planned to
spend the money on home improvements, cars or other major purchases. 10% (down from 15%)
expected to use the proceeds to pay off credit card debt. 15% (up from 11%) planned to use the
money in other ways.

"The results of the Cambridge Consumer Credit Index wildcard question show clearly that the
refinancing boom which gave consumers billions of dollars in additional spending power is rapidly
waning. Compared to a year and a half ago, fewer Americans are putting the proceeds from
refinancing into bank savings accounts and more of them plan to pay off credit card debt and other
loans. With fewer refinancings anticipated in coming months, fewer consumers will be able to pay
off their credit card and other debts or add to savings," says Jordan Goodman, spokesperson/
financial analyst for the Cambridge Consumer Credit Index.

These findings are the result of monthly nationwide telephone poll of 1000+ adults conducted by 
ICR/International Communications Research in the past week, sponsored by the Debt Relief
Clearinghouse.

The overall Cambridge Consumer Credit Index rose by 9 points in May to 68. The Index rose in all
three of its component questions.  The "Reality Gap," which is the difference between the amount of
debt consumers say they will pay off in the next month versus the amount of debt they actually paid
off a month later, increased by 8 percentage points from April to 16 points.  A month ago, 82% of
Americans planned to pay off debt, while a month later only 66% actually did so.

Wild Card Question:

Which statement regarding your mortgage best describes you?:

Source: Cambridge Consumer Credit Index

The Cambridge Consumer Credit Index is a forward looking economic indicator gauging consumer
spending and debt. It is released on the fifth business day of every month to coincide with the Federal
Reserve Board's G19 release of consumer credit outstanding data.

In conjunction with the Index, the Cambridge Credit Counseling Corp. is releasing its monthly survey
of people who have called in for credit counseling services over the past month. 

Cambridge representatives ask callers for the primary reason that they found it necessary to get help
with their debts now. Of the 532 people who answered, this was the order of their responses:

    1. I am frustrated with high bank rates and fees (31.4%)

    2. My income has been reduced from a lower salary, less overtime or layoff (21.4%)

    3. I want to improve my ability to achieve future financial goals like buying a house or saving for
retirement (15.6%)

    4. I got into too much debt by overspending (10%)

    5. Large medical expenses forced me to take on huge debts (7.7%)

    6. My lack of financial education caused me to take on too much debt (7.3%)

    7. Other (4.9%)

    8. Recently divorced or widowed (1.7%)

For more information on the survey see
http://www.cambridgeconsumerindex.com/index.asp?content=client_survey

The Cambridge Consumer Credit Index number is a composite of these three questions:

    1. In the past month, have you taken on more debt or paid off debt?

The Index reads 68 on this question, a jump of ten points from April.

In May, 35% of Americans say they have taken on more debt, with 20% taking on a little and 15%
taking on a lot more debt. Conversely, 66% of Americans have paid off debt, with 46% paying off a
little and 20% paying off a lot.

    2. In the next month, do you anticipate taking on more debt or paying off debt?

    The Index reads 52 on this question, up by sixteen points from April.

In May, 26% plan to take on more debt, with 9% planning to take on a lot and 16% planning to take
on a little debt. Conversely, 74% plan to pay off debt, with 58% paying off a little and 17% paying off
a lot. In April, 82% planned to take on debt and 18% planned to pay off debt.

    3. In the next six months, do you expect to take on debt because you are thinking of making a
major purchase such as a car, education, appliance, medical procedure, furniture or carpeting?

The Index reads 84 on this question, up by two points from April

In May, 42% of Americans plan to take on more debt to make such purchases, with 15% taking on
a lot of debt and 27% taking on a little more debt. In contrast, 58% of Americans plan to pay off debt
in the next six months, with 41% expecting to pay off a little and 17% expecting to pay off a lot. In
April, 41% of Americans planned to take on more debt, while 59% planned to pay off debt.

"The results of the Cambridge Consumer Credit Index indicate that consumers have been taking on
and plan on taking on even more debt at a rapid rate. All three questions remain well above their
long-term averages. The next six-month level of 84 hit an all-time high for the third straight month,
showing that consumers plan to make many major purchases with credit over the next few months.
On one hand, this surge in the Index shows growing consumer confidence in the ability to repay debt.
However, most of the increase in new debt is being taken on by lower-income Americans, who usually
borrow because they need to pay their existing bills, not because they are spending on major new
purchases," says Jordan Goodman, spokesperson for the index.

The Index survey is conducted by ICR (International Communications Research) of Media,
Pennsylvania over five days in the week before the Index is released. Over 1000 households are polled
based on random-digit dialing, with all demographic and regional groups in Americafairly represented.
The Index has a margin of error of plus or minus three percentage points.

For more information about the Cambridge Consumer Credit Index, contact media relations representative 
Paramjit Mahli at mailto:pmahli@cambridgeconsumerindex.com or 631-786-6450, or economist Allen
Grommet, who provides an economic analysis of Index results, at agrommet@cambridgeconsumerindex.com
or 800-804-0575, or the Index website at http://www.cambridgeconsumerindex.com/. Consumers wishing to
find out more about Debt Relief Clearinghouse placement services should call 1-888-4DEBTHELP or visit
http://www.debtreliefonline.com/.

For further information contact Paramjit Mahli at 631-786-6450

SOURCE Cambridge Consumer Credit Index Web Site: 
http://www.cambridgecredit.org
http://www.cambridgeconsumerindex.com
http://www.debtreliefonline.com