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NEW YORK – U.S. household debt rose $334 billion, or 1.8%, in the third quarter to $19.105 trillion, the Federal Reserve Bank of New York reported Tuesday. Mortgages accounted for most of the increase, while home-equity credit lines recorded their largest balance gain since 2005.
The November 10 report covers balances through the end of September. It is a quarterly snapshot of borrowing and repayment, not a real-time measure of consumer spending.
Mortgage debt rose $257 billion to $13.374 trillion. Home equity lines of credit, or HELOCs, increased $23 billion to $481 billion. Credit-card balances grew $22 billion to $1.285 trillion, while auto debt rose $21 billion to $1.734 trillion.
Student debt increased $5 billion to $1.656 trillion. Mortgage originations reached $595 billion during the quarter, and new auto loans appearing on credit reports totaled $208 billion. Credit-card limits increased $115 billion and HELOC limits rose $31 billion.
“Household debt levels rose moderately, led by increases in mortgage and home equity line of credit originations,” said Donghoon Lee, an economic research adviser at the New York Fed. “Although delinquency transition rates for housing debts have crept up, the overall credit quality of these loans remains strong.”
The share of outstanding debt in some stage of delinquency rose to 5.0%, up 0.3 percentage points from the previous quarter. That overall measure should not be confused with the rate at which previously current or less-overdue balances newly become seriously delinquent.
Transitions into early delinquency increased for auto loans and mortgages but improved slightly for credit cards. Transitions into serious delinquency improved slightly for credit cards and student loans, while auto loans and HELOCs were flat. Mortgage transitions worsened but remained low by historical standards, the New York Fed said.
Serious delinquency means a payment is at least 90 days late. The report’s transition rates are annualized shares of balances newly moving into that category, rather than the share of all borrowers who are behind on payments.
The figures come from the New York Fed’s Consumer Credit Panel, a nationally representative sample based on anonymized Equifax credit data. The report tracks mortgage, student, auto and credit-card debt, among other categories.
What it means: Household borrowing increased, led by housing credit, and a larger share of total debt was overdue. But the repayment picture was mixed across loan types. The report does not show that every delinquency measure worsened or establish a collapse in consumer spending.
JBizNews Desk | Economy & Business
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