The amount of household debt increased in the third quarter and is now greater than the level consumers held at the bottom of the post-financial crisis. Household debt increased by $219 billion (1.6%) to $13.51 trillion in the third quarter of 2018.
Furthermore, overall household debt is 21.2% above the post-financial-crisis trough reached during the second quarter of 2013, according to the Quarterly Report on Household Debt and Credit from the Federal Reserve.
“Older borrowers now hold a larger share of total outstanding debt balances, while the shares held by younger borrowers have contracted and shifted toward auto loans and student loans,” said Donghoon Lee, research officer at the Fed. It was the 17th consecutive quarter with an increase and the total is now $837 billion higher than the previous peak of $12.68 trillion in the third quarter of 2008.
Among other trends from the report are the following:
Housing Debt
- Mortgage originations increased to $445 billion from $437 billion in the second quarter.
- Mortgage delinquencies were roughly flat, with 1.1% of mortgage balances 90 or more days delinquent in the third quarter.
Non-Housing Debt
- Outstanding student loan debt increased by $37 billion and stood at $1.44 trillion as of September 30.
- Auto loan balances increased by $27 billion to $1.27 trillion in 2018Q3.
- Credit card balances rose by $15 billion to $844 billion.
Delinquencies, Collection Accounts, and Credit Inquiries
- Mortgage delinquency transition rates increased slightly with about 1.2% of current balances transitioning into delinquency.
- The number of credit inquiries within the past six months--an indicator of consumer credit demand--increased slightly--but remains among the lowest seen in the history of the data.