Household debt surpasses 2008 peak

Mortgage Professional America - Anna Sobrevinas - 22 May 2017

Household debt has surpassed the 2008 recession peak during the first quarter of the year, according to the Federal Reserve Bank of New York.

Data from the bank’s Quarterly Report on Household Debt and Credit reported total household debt has increased for the 11th straight quarter, reaching $12.73 trillion in Q1 2017 and surpassing the $12.68 trillion Q3 2008 peak during the recession.

 “Almost nine years later, household debt has finally exceeded its 2008 peak but the debt and its borrowers look quite different today,” said Donghoon Lee, research officer at the New York Fed. “This record debt level is neither a reason to celebrate nor a cause for alarm. But it does provide an opportune moment to consider debt performance.”

Mortgage originations for the first quarter went down to $491 billion from $617 billion, while mortgage delinquencies (90+ days delinquent) slightly worsened to 1.7% in Q1 2017 from 1.6% in Q4 2016.