New York Fed: Household Debt; Mortgage Balances Decrease Slightly

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Total household debt decreased by 0.1%, or $13 billion, in the second quarter to $18.8 trillion, the Federal Reserve Bank of New York reported last week. Mortgage balances declined by $74 billion.

The New York Fed’s Center for Microeconomic Data released its Quarterly Report on Household Debt and Credit Tuesday.

“Delinquency rates across most products have held steady over the past two years,” noted Joelle Scally, Economic Policy Advisor at the New York Fed. “Still, new delinquencies for auto loans and credit cards remain at elevated levels, a trend we’ll continue to monitor.”

Mortgage balances declined by $74 billion in the second quarter and totaled $13.1 trillion at the end of June. Home equity lines of credit balances rose by $13 billion totaling $459 billion, $142 billion above the low reached in first-quarter 2022.

“The pace of mortgage originations was largely steady with $505 billion newly originated in Q2 2026,” the report said. “HELOC limits rose by $19 billion, continuing an expansion in HELOCs that began in 2022.”

The report said aggregate delinquency rates improved slightly during the quarter, with 4.7% of outstanding debt (across sources) in some stage of delinquency. Transition into early delinquency rose slightly for auto loans and mortgages but was largely steady for credit cards and “other” debts. Delinquency transitions improved slightly for HELOCs.

“Transition rates into serious delinquency remained mostly unchanged,” the New York Fed said. “Student loan delinquencies were an exception, with the continued impact of the re-reporting of defaulted student debt causing some distortions.”