Yet another red flag about the financial crisis on the horizon.
"American household debt continues to climb to record levels, reaching $13.54 trillion in the fourth quarter of 2018.
According to the latest report from the Federal Reserve Bank of New York’s Center for Microeconomic Data, household debt is now $869 billion higher than 2008’s $12.68 trillion peak.
It is also 21.4% above the debt levels seen in the wake of the financial crisis in 2013."
Americans are more in debt now than they were after the financial crisis
American household debt continues to climb to record levels, reaching $13.54 trillion in the fourth quarter of 2018.
According to the latest report from the Federal Reserve Bank of New York’s Center for Microeconomic Data, household debt is now $869 billion higher than 2008’s $12.68 trillion peak.
It is also 21.4% above the debt levels seen in the wake of the financial crisis in 2013.
A large portion of this collective debt is a result of auto loans, which have been climbing steadily since 2011, increasing $9 billion in Q4.
Last year saw the highest level of auto loan debt in the 19 years that this data has been collected, with $584 billion in new auto loans and leases appearing on credit reports.
But a slowdown in mortgage originations has tempered debt growth in Q4, the New York Fed said.
Mortgage originations declined from $445 billion to $401 billion, reaching their lowest level in nearly four years. Mortgage balances totaled $9.1 trillion, mostly unchanged from the previous quarter.
Delinquencies were also flat, with 1.1% of mortgage balances late by 90 days or more.
HELOC balances also declined, falling $10 billion in Q4 to $412 billion – the lowest level in 14 years.
While mortgage debt declined, credit card and student debt rose. Outstanding student loan debt climbed to $1.46 trillion from $1.44 trillion, while credit card balances increased $26 billion to $870 billion, consistent with seasonal patterns.
On a positive note, bankruptcy notations were down in Q4. About 195,000 consumers had a bankruptcy notation added to their credit reports, down 5,000 from the same time last year.
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