The number of individuals with a debt that had been placed with a third-party collection agency continued to decline in the first quarter, along with the average collection amount per person with a debt in collection, according to data released yesterday by the Federal Reserve Bank of New York.
About 9% of individuals had a debt that had been placed with a third-party agency during the first quarter of 2019, down from a high of more than 14% five years ago. After having risen for most of 2018, the average collection amount per person dipped below $1,400 in the first quarter.
Overall, there was $13.67 trillion of household debt at the end of the first quarter, an increase of $124 billion from the end of the fourth quarter of 2018. The increase marked the 19th consecutive quarter where the total amount of household debt had increased and is now $1 trillion higher than the previous high-water mark, which was set in 2008.
There was an uptick in the number of credit cards and auto loans that became “seriously” delinquent in the first quarter, where no payment has been made for at least 90 days. Despite the increase, researchers at the New York Fed do not appear to be too concerned, yet.
“The rate at which credit card balances become delinquent has been rising, and that has coincided with an increase in younger borrowers entering the credit card market,” said Andrew Haughwout, senior vice president at the New York Fed, in a statement
