Total household debt hit a record $17.94 trillion
of ConsumerAffairs
The Federal Reserve Bank of New York's Center for Microeconomic Data has released its latest Quarterly Report on Household Debt and Credit, revealing a significant increase in U.S. household debt.
In the third quarter of 2024, total household debt rose by $147 billion, or 0.8%, reaching a record $17.94 trillion. This data from the New York Feds Consumer Credit Panel highlights the ongoing financial dynamics affecting American households.
As many families struggle with inflation, the report shows credit card debt surged by $24 billion in the third quarter, rising to $1.17 trillion. Thats 8% higher than a year ago.
But the report found some good news about credit card debt. Despite the increase, the delinquency rate fell slightly, suggesting consumers have a better handle on their debt.
A key insight from the report is that while household debt continues to climb, income growth has outpaced this rise.
"Although household balances continue to rise in nominal terms, growth in income has outpaced debt," said Donghoon Lee, economic research advisor at the New York Fed.
How the debt breaks down
The report details various components of household debt. Mortgage balances saw a $75 billion increase, reaching $12.59 trillion by the end of September.
Home equity lines of credit (HELOC) also rose by $7 billion, marking the tenth consecutive quarterly increase, and now total $387 billion.
Auto loan balances increased by $18 billion, at $1.64 trillion. Other consumer loans, including retail cards, remained relatively stable with a $2 billion increase. Meanwhile, student loan balances grew by $21 billion, totaling $1.61 trillion.
The pace of mortgage originations showed a slight uptick, with $448 billion in newly originated mortgages during the quarter. Credit card account limits expanded modestly by $63 billion, a 1.3% increase from the previous quarter, while HELOC limits rose by $9 billion, continuing a ten-quarter growth streak.
Despite these increases, the report highlights mixed trends in delinquency rates. Overall, 3.5% of outstanding debt was in some stage of delinquency, a slight rise from the previous quarter, with credit card delinquency rates the outlier.
Photo Credit: Consumer Affairs News Department Images
Posted: 2024-11-15 14:01:31
