The debt burden of U.S. households is the smallest it’s been in nearly 16 years.
Household debt — including mortgages, credit cards, auto loans, student loans and other credit — grew for the 16th consecutive quarter in the April-to-June period, rising by 0.6%, or $82 billion, to $13.29 trillion, the New York Fed reported Tuesday.
With personal disposable incomes at a $15.46 trillion annual rate in the quarter, the debt-to-income ratio dipped to 86%. That’s the lowest, by an admittedly small amount, since the fourth quarter of 2002. At the height of the credit bubble in 2008, debts topped at 116% of disposable income.
What’s also encouraging is that the flow into seriously delinquent debt stayed at 2.3% in the second quarter, according to the New York Fed report. Those numbers reached as high as 7.9% during the recession and have gradually drifted downward.
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Rex Nutting contributed to this report.
