Mortgage originations and mortgage balances expanded in tandem in the fourth quarter of 2016, reaching the highest level since the onset of the recession, with debt up 1.6 percent, according to the Federal Reserve Bank of New York’s recent Quarterly Report on Household Debt and Credit.
Household debt overall grew 1.8 percent quarter-over-quarter, 0.8 percent away from its 2008 peak. Mortgage debt, says Wilbert van der Klauuw, senior vice president at the Bank, is not a primary driver.
“Debt held by Americans is approaching its previous peak, yet its composition today is vastly different as the growth in balances has been driven by non-housing debt,” van der Klauuw says. “Since reaching a trough in mid-2013, the rebound in household debt has been led by student debt and auto debt, with only sluggish growth in mortgage debt.”
Non-housing debt, which includes auto loans, credit cards and student loans, all increased in the fourth quarter of 2016, with student loan debt continuing an 18-year trend.
Source: Federal Reserve Bank of New York
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