NEW YORK—In its latest Quarterly Report on Household Debt and Credit, the Federal Reserve Bank of New York today announced that delinquency rates for mortgages (6.3 percent), credit cards (10.9 percent), and auto loans (4.2 percent) decreased from the previous quarter. However, rates for student loans (8.9 percent)1 and home equity lines of credit (HELOC) (4.9 percent) increased from March.
Household indebtedness declined to $11.38 trillion, a $53 billion decline from the first quarter of 2012. Outstanding household debt has decreased $1.3 trillion since its peak in Q3 2008. The reduction was led by a decline in real estate-related debt like mortgages and HELOC. More information about how Americans are paying down their debt is available in our corresponding blog post.
"The continuing decrease in delinquency rates suggests that consumers are managing their debts better," said Wilbert van Der Klaauw, vice president and economist at the New York Fed. "As they continue to pay down debt and take advantage of low interest rates, Americans are moving forward with rebalancing their household finances."
Approximately 256,000 consumers had a foreclosure notation added to their credit reports in the quarter, the lowest since mid-2007. Mortgage originations, which we measure as the appearance of new mortgages on consumer credit reports, rose to $463 billion.
The New York Fed’s Quarterly Report also includes data on student loans, credit cards, auto loans and delinquencies. Other highlights from the report include:
- Student loan debt rose $10 billion to $914 billion.
- Credit card balances ($672 billion) are at the lowest level since Q2 2002 and are down nearly a quarter (22.4 percent) from the peak in Q4 2008.
- Credit card delinquencies (10.9 percent) are at the lowest level since Q4 2008.
- Credit inquiries within six months—an indicator of credit demand—decreased for the second consecutive quarter, a 2 percent dip from Q1 2012.
- Auto loans stand at $750 billion, a quarterly increase of $13 billion.
About the New York Fed’s Quarterly Report
The New York Fed’s Quarterly Report on Household Debt and Credit provides unique data and insight into the credit conditions and activity of U.S. consumers. The report includes information on various aspects of consumer debt, including bankruptcies, per capita debt levels, total debt levels and composition of debt, new originations of installment loans, total balance by delinquency status, foreclosures and new delinquencies by loan type for the U.S. and select states. The report is aimed at helping community groups, small businesses, state and local government agencies and the public to better understand, monitor and respond to trends in borrowing and indebtedness at the household level. The report is based on data from the New York Fed’s Consumer Credit Panel, a nationally representative random sample drawn from Equifax credit report data. 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.
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1As explained in a recent blog post, these delinquency rates for student loans are likely to understate actual delinquency rates because almost 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.