Consumer debt hits new record of $14.3 trillion

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In this Friday, April 10, 2020, photo, Tahir Mehood displays the receipt he received after paying his Sacramento County property tax in Sacramento, Calif. The coronavirus outbreak has delayed income taxes, mortgage payments and even evictions in California. But Gov. Gavin Newsom did not delay the property tax deadline for the state’s homeowners to pay their property taxes without a penalty.

Rich Pedroncelli | AP

Consumer debt hit a fresh record high to start 2020, even as credit card balances declined while Americans adjusted to the coronavirus pandemic.

Household debt balances through March totaled $14.3 trillion, a 1.1% increase from the previous quarter and now $1.6 trillion clear of the previous nominal high of $12.7 trillion in the third quarter of 2008 during the financial crisis, according to New York Federal Reserve data released Tuesday.

However, one area posted a notable decline. 

Credit card balances fell $34 billion, a drop that helped offset non-housing balance increases of $27 billion in student loans and $15 billion in auto debt. Mortgage balances rose $156 billion to $9.71 trillion.

“The credit card balance decline was notably larger than the same period last year, which may reflect the early signs of decreased consumer spending due to COVID-19,” the New York Fed said in a release.

That decrease in card balances came even though total credit limits increased by $34 billion, leaving $3 trillion in available credit lines.

Consumers have retrenched of late has much of the $22.5 trillion U.S. economy has been shut down to try to halt the coronavirus spread. Retail sales numbers have dropped sharply amid a slide in consumer confidence.

After the modest uptick in the first quarter, student loan debt now totals $1.54 trillion. Some 10.8% of the debt was 90 days or more delinquent. Overall debt delinquency ticked down to a 4.6% rate.

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