US households add $141bn in mortgage debt in Q3

Total household debt increased for the 17th straight quarter

US households add $141bn in mortgage debt in Q3

American households added about $141 billion in mortgage debt during the third quarter as overall household debt increased for the 17th consecutive quarter, according to the Quarterly Report on Household Debt and Credit released by the Federal Reserve Bank of New York.

The report found that year over year, mortgage debt increased by $397 billion from the third quarter of 2017 to total $9.14 trillion as of the third quarter of this year. Mortgage originations increased to $445 billion from $437 billion in the second quarter. Mortgage delinquency transition rates increased slightly with about 1.2% of current balances transitioning into delinquency.

Total household debt increased by $219 billion (1.6%) to $13.51 trillion in the third quarter. The report found that the total is now $837 billion higher than the previous peak of $12.68 trillion in the third quarter of 2008.

Outstanding student loan debt increased by $37 billion and stood at $1.44 trillion as of Sept. 30.

Auto loan balances increased by $27 billion to $1.27 trillion in the quarter. Credit card balances rose by $15 billion to $844 billion.

The number of credit inquiries within the past six months, which indicates consumer credit demand, increased slightly but remains among the lowest seen in the history of the data.

“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 New York Fed.

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