Household Debt Tops 2008 Peak

Outstanding household debt increased by a 1.2 percent in the first quarter, rising by $149 billion to a new record level of $12.73 trillion, the Federal Reserve Bank of New York said yesterday. The quarterly increase brought household debt above its 2008 peak and was driven by increases in nearly every debt category.

The first quarter saw growth in mortgage balances and auto loans, student loan balances rising by $34 billion and credit card balances declining by $15 billion. The composition of U.S. household debt has shifted since 2008, with mortgages now accounting for 68 percent of debt, student loans for 11 percent, auto loans for 9 percent, credit cards for 6 percent and home equity lines of credit for 4 percent.

Overall delinquency rates were steady in the first quarter at 4.8 percent of outstanding balances. Auto debt delinquencies continued to deteriorate and early delinquencies on credit cards saw a rise. Consistent with other data, lenders focused more on borrowers with higher credit scores for auto and mortgage loans.

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