Consumer debt surged to $14.3T before worst of coronavirus crisis, Fed says
Mortgage balances, the largest component of household debt in the U.S., jumped by $156 billion in the first quarter
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Household debt surged by more than $150 billion to a new record high in the first three months of the year, just before the worst of the coronavirus pandemic began to batter Americans' finances, according to the New York Federal Reserve.
The results don't capture the full extent of the pandemic's impact because the data was collected through March 31, just two weeks into the virus-induced lockdown.
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The total debt balance is now $14.3 trillion, roughly $1.6 trillion higher than the previous peak of $12.68 trillion in the third quarter of 2008, in the midst of the Great Recession.
Mortgage balances, the largest component of household debt in the U.S., jumped by $156 billion in the first quarter to $9.71 trillion.
Non-housing balances were mostly flat in the first quarter, with increases of $27 billion in student loans and $15 billion in auto loans offset by a $34 billion seasonal decline in credit card balances.
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“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 news release.
The drop of card balances came as total credit limits increased by $34 billion, leaving more than $3 trillion in available credit.
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