Consumer debt reached an all-time high of $16.9 trillion at the end of 2022, a 1.3 trillion dollar increase from 2021. Delinquency rates were also seen to be rising for many loan categories, according to the NY Federal Reserve.
Mortgage originations for new home loans and refinancings fell to $498 billion, a drop of $145 billion from Q3 of 2021, and an almost 50% drop from Q4 of 2021. Despite this, however, mortgage balances rose to $11.9 trillion, an almost $250 billion increase from Q3 of 2021, and an almost $1 trillion increase from a year ago.
Mortgages that are considered to be in serious delinquency (delinquency of 90 days or more) rose to a rate of 0.57%, nearly double compared to the rates at the same time last year. Automotive loan debt delinquencies rose by 0.6% to reach 2.2%, and credit card debt rose to 4%, a 0.8% increase. Student loan debt also increased for this month, after staying at a constant rate throughout most of the pandemic, with student loan balances hitting $1.6 trillion in Q4 of 2022.
This news comes in the wake of rising inflation and climbing interest rates, even as employment level remain robust, with the Federal Reserve following an aggressive rate-hiking campaign to combat 41-year high inflation rates, with the Federal Reserve increasing target rates seven times during 2022.
This increase in consumer debt arrives during this ongoing Federal government borrowing situation, with US Government debt standing at $31.5 trillion, up from 29.6 trillion at the end of 2022, according to data from the Treasury Department.
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