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  • Frank Tian

US Household Debt Q2 Update

Updated: Sep 23, 2022

Q2 saw the steepest interest rate hike.

How is the US household credit doing?

Here is the latest quarterly report from the Fed: ๐Ÿ‘‡

US household debt up $312 billion in Q2 โ€˜22.

The total debt reached $16.15 trillion.

$1.2 trillion increase or +8.0% over Q2 โ€˜21.

๐Ÿก Mortgage

Up $207 billion Q/Q, +9.0% Y/Y.

With the interest rate rising fast,

Origination volume slows down,

The median housing price is still up 13.4% Y/Y.

๐Ÿš— Auto loan

Up $33 billion Q/Q, +6.2% Y/Y.

Strong origination stays at peak level.

Itโ€™s mainly driven by high car price,

As the supply chain issue continues.

๐Ÿ’ณ Credit card

Up $46 billion Q/Q, 100 billion Y/Y.

That is a strong +13% Y/Y rebound.

With high inflation and cash in the bank,

Consumers actively pull out their cards.

๐Ÿ‘ฉโ€๐ŸŽ“ Student loan

Flat Q/Q, +1.2% Y/Y.

The total is $1.59 trillion.

๐ŸŸฉ Credit Quality

For all the major credit products, the late-stage delinquency rates remained low.

The underwriting continues to be robust: 65% of new mortgages originated from credit scores of 760+.

๐ŸŸจ Normalization

However, risk metrics are on the way to normalizing (increase).

๐Ÿ’  The flow rates to both 30+ and 90+ days delinquency began to go up.

๐Ÿ’  35,000 individuals had foreclosures in the quarter vs. 24,000 in Q1 โ€˜22 and 9,000 in Q4 โ€˜21.

Source: HOUSEHOLD DEBT AND CREDIT REPORT (Q2 2022) ๐Ÿ”นIf you enjoy this post, consider receiving content like this in your inbox.


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