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Household Debt Growth Hits Seven-Year High in Second Quarter

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Woman with bills and calculator.

Total household debt stood at $14.96 trillion in the second quarter of 2021, as mortgage balances continued to climb while new extensions hit a series high.

Source: New York Federal Reserve

Total household debt increased by 2.1%, the largest increase in aggregate balance in seven years since the fourth quarter of 2013. This is equivalent to an increase of $313 billion, the largest nominal increase in debt balances since the second quarter of 2007.

Mortgage balances, the biggest component of household debt, stood at $10.44 trillion. This is $282 billion higher than the previous quarter and $666 billion higher than the same quarter in 2020.

Student debt followed at $1.57 trillion, auto debt at $1.42 trillion, credit card debt at $0.79 trillion, home equity at $0.32 trillion, and other debt at $0.42 trillion.

New extensions of installment credit hit series highs in the quarter for both mortgages and auto loans, with originations hitting a robust pace over the last four quarters.

Credit inquiries increased to $121 million, while account openings hit 206 million.

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