Household debt jumped in first quarter of 2021 thanks to demand for cars and homes, according to the New York Fed’s Quarterly Report on Household Debt and Credit (NYFED)
- Mortgage debt jumped $117 billion, or about 1.2%, to $10.16 trillion.
- Auto loans increased by $8 billion to $1.38 trillion
Student debt contributed $29 billion which put total household debt at $14.64 trillion. This was an $85 billion jump, or 0.6% increase in Q1 2021.
An increase in household debt is not a bad thing, especially when looking at the type of debt. Yesterday, the Wall Street Journal reported that credit card debt was down 14.5% compared to the same time last year. Americans are paying down unsecured high-interest debt for securitized low-interest debt. This is a much better scenario for consumers and the economy.
