Total household debt saw a precipitous climb in 2021, according to the New York Fed’s Quarterly Report on Household Credit and Debt…(NYFED)
- Aggregate household debt balances totaled $15.58 trillion in the fourth quarter of 2021, a $333 billion increase from Q3 (+2.2%).
- This was the largest increase since 2007 in both percentage and nominal terms.
NOTE: Outstanding debt is now $1 trillion higher (+6.9%) than 2020 and $1.4 trillion higher than 2019 (+9.9%).
HOUSING: The good news is a large portion of this new debt was housing debt…
- There were $1.03 trillion in newly originated mortgage debt in Q4 of 2021, with 67% of it going to borrowers with credit scores higher than 760.
- In total, mortgage originations hit an all-time higher of $4.5 trillion in 2021.
AUTOMOBILES: Skyrocketing automobile prices mean bigger loans for consumers to buy said cars…
- “The volume of newly originated auto loans, which includes leases, was $181 billion, primarily reflecting higher origination amount per loan rather than more loans originated.”
CREDIT CARDS: Credit card limit also ticked up in the 4th quarter of 2021…
- Aggregate limits on credit cards jumped $96 billion in the 4th quarter and now stand at $4.06 trillion, compared to $3.93 trillion in the first quarter of 2020.
Interestingly enough, consumer demand for credit actually fell in the 4th quarter with credit inquires at 115 million, a 6.1% decline when compared to the previous quarter.