Delinquency rates are on the rise. The amount of debt being carried by consumers is on the rise. The number of accounts being placed with third-party collection agencies? That number is on the decline, according to data released yesterday by the Federal Reserve Bank of New York.
By the Numbers; Less than 5% of consumers had a debt in collection as of the end of 2023, a figure that remains at a historically low rate dating back over the last two decades. it has fallen steadily since the beginning of 2017, when it was at 12%.
- Also falling during the fourth quarter was the average collection amount. That stood at just under $1,600, which was down slightly from the third quarter of 2023, but still well above where it was during the last three months of 2022.
- Overall, the total amount of household debt rose by $212 billion during the fourth quarter and stood at $17.5 trillion.
- Consumers, though, are showing signs of financial stress, especially when it comes to their auto loans and credit cards. More than 6% of credit card holders were transitioning from just being delinquent on their payments to being seriously delinquent, meaning they had not made any payment for at least 90 days. That is up from 4% at the same point a year earlier.
- The average aggregate delinquency rate, which takes all different types of debt into consideration, was 3.1% at the end of December, which was up from 3% at the end of the third quarter.
