from the New York Fed
In its Q4 2014 Household Debt and Credit Report, the Federal Reserve Bank of New York announced that outstanding household debt increased $117 billion from the third quarter. The one percent increase puts total household indebtedness at $11.83 trillion as of December 31, 2014. Total debt has gone up $326 billion since the fourth quarter of 2013. The report is based on data from the New York Fed’s Consumer Credit Panel, a nationally representative sample drawn from anonymized Equifax credit data.
Balances were largely up across the board, led by mortgages ($39 billion) and student loans ($31 billion). Auto loan debt and credit card debt increased by $21 billion and $20 billion, respectively. Outstanding student loan balances now stand at $1.16 trillion.
While overall delinquency rates were unchanged at 4.3 percent in the fourth quarter, delinquency rates for auto loans and student loans worsened. Our Liberty Street Economics blog post provides a further discussion of the delinquency picture. Said Donghoon Lee, research officer at the Federal Reserve Bank of New York:
Although we’ve seen an overall improvement in delinquency rates since the Great Recession, the increasing trend in student loan balances and delinquencies is concerning. Student loan delinquencies and repayment problems appear to be reducing borrowers’ ability to form their own households.
Other findings from the report include:
- Mortgage originations, which are measured as appearances of new mortgage balances and also include refinanced mortgages, increased to $355 billion, but remain low by historical standards.
- The number of credit inquiries within six months – an indicator of consumer credit demand – increased by 4 million from the previous quarter, to 175 million.
Household Debt and Credit Developments as of Q4 2014:
Category | Quarterly Change* | Annual Change** | Total as of Q4 2014 |
Mortgage Debt | (+) $39 billion | (+) $121 billion | $8.17 trillion |
Student Loan Debt | (+) $31 billion | (+) $77 billion | $1.16 trillion |
Auto Loan Debt | (+) $21 billion | (+) $92 billion | $955 billion |
Credit Card Debt | (+) $20 billion | (+) $17 billion | $700 billion |
HELOC | (-) $2 billion | (-) $19 billion | $510 billion |
Total Debt | (+) $117 billion | (+) $326 billion | $11.83 trillion |
*Change from Q3 2014 to Q4 2014
**Change from Q4 2013 to Q4 2014
90+ day delinquency rates:
Category | Q4 2014 | Q3 2014 |
Mortgages | 3.1 % | 3.2 % |
Student Loans | 11.3% | 11.1% |
Auto Loans | 3.5% | 3.1% |
Credit Cards | 7.3% | 7.5% |
HELOC | 3.2% | 3.3% |
All | 4.3% | 4.3% |
Visit interactive webpage: Household Debt and Credit Report »
1 Delinquency rates are computed as the proportion of the total debt balance that is at least 90 days past due.
2 As explained in a recent report, delinquency rates for student loans are likely to understate actual delinquency rates because about half of these loans are currently in deferment, in grace periods or in forbearance and therefore temporarily not in the repayment cycle. This implies that among loans in the repayment cycle delinquency rates are roughly twice as high.
About the report: The Federal Reserve Bank of New York’s Household Debt and Credit Report provides unique data and insight into the credit conditions and activity of U.S. consumers. Based on data from the New York Fed’s Consumer Credit Panel, a nationally representative sample drawn from anonymized Equifax credit data, the report provides a quarterly snapshot of household trends in borrowing and indebtedness, including data about mortgages, student loans, credit cards, auto loans and delinquencies. The report aims to help community groups, small businesses, state and local governments and the public to better understand, monitor and respond to trends in borrowing and indebtedness at the household level. Sections of the report are presented as interactive graphs on the New York Fed’s Household Credit web page and the full report is available for download.
