Household debt rises to $17 trillion as delinquencies increase
Americans have more debt than ever, and more people are falling behind on their payments.
Total household debt rose to a record $17 trillion in the first quarter of 2023, up from $16.9 trillion in the previous quarter, according to the Federal Reserve Bank of New York’s Household Debt and Credit Report, published in Monday.
Also on the rise was the number of loans more than 90 days past due, with accounts increasingly delinquent for every type of loan other than student loans (which are still subject to a federal pandemic relief pause on payments and interest.)
The arrears rate is still well below pre-pandemic levels, but highlights the increasing pressures facing household budgets in recent months. Previous research has shown that high inflation — and higher interest rates on loans due to the Federal Reserve’s anti-inflationary rate hikes — has caused more people to fall behind on their bills.
The amount of new mortgage debt has slowed, highlighting the recent slowdown in the mortgage market. Mortgage debt grew half as fast in the first quarter of 2023 as in the previous quarter.
High interest rates, home prices and homeowners reluctant to sell because of the low mortgage rates they locked up during the pandemic are working against people taking out new home loans.